Government should streamline TDS for purchase of immovable property for NRIs: CII

Budget Expectations: As the anticipation builds for the upcoming budget, businesses and taxpayers are eagerly awaiting potential reforms and provisions that could shape the fiscal landscape. Among the expectations are several key tax proposals aimed at simplifying procedures and promoting specific sectors.

Simplified TDS procedures for immovable property transactions

One of the anticipated reforms involves the streamlining of Tax Deducted at Source (TDS) procedures related to the purchase or rental of immovable property from non-residents. 

Taxpayers hope for the introduction of a unified challan cum return form, similar to existing forms 26QB and 26QC, to ease compliance burdens. This could eliminate the need for separate Tax Deduction and Collection Account Numbers (TAN) and simplify withholding tax obligations, industry body Confederation of Indian Industry (CII) said.

Clarification on perquisite tax for electric cars

With a growing emphasis on sustainable transportation, there's an expectation for clearer guidelines regarding the taxation of electric vehicles provided by employers to employees. Businesses are eager for amendments to the Income Tax Rules to define the criteria for perquisite taxation in this regard, potentially incentivising the adoption of electric vehicles in corporate fleets, CII noted

Rationalisation of capital gains tax structure

Another area of focus is the rationalisation of the capital gains tax structure. Taxpayers seek consistency and simplicity across different asset classes, with proposed reforms including uniform tax rates and holding periods for various financial instruments and assets such as equity, mutual funds, bonds, and immovable property, CII said.

Facilitation of business restructuring

In the realm of business restructuring, expectations centre around extending benefits such as carry forward and set-off of losses and unabsorbed depreciation under Section 72A to service and trading organisations. Additionally, there's a call to expand the definition of demerger to cover shares of operating subsidiaries, ensuring tax-neutral restructuring and protecting the continuity of business operations, the industry body said.