S. Jaykishan

Chartered Accountants

Analysis of Provisions of Finance Bill, 2021

Analysis of Provisions of Finance Bill, 2021

– By Team S. Jaykishan

India’s Union Budget 2021, the first digital budget, touted as the most important budget in the decades, came at a time when India is reeling under the COVID-19 crisis. It reflects the government’s commitment on digital economy, technology, innovation, and R&D alongside adoption of new-age technologies, such as AI and ML, in administration of companies, taxation, digital payments and focus on fin-tech.

The Union Budget clearly enumerates measures to kick-start economic recovery and growth by ushering reforms that boost private investment and enable job creation while prioritising expenditure in healthcare, infrastructure, and sustainability. The Budget focuses on the development agenda, keeping diverse interests of the nation and its citizens. The six-part budget has stressed significantly on ‘self-reliance’ by boosting infrastructure and domestic trade. In addition to budgetary outlay for the MSMEs, revision in custom tariffs is also aimed at increasing economic activity. In line with recognising human capital as one of the main pillars of the economy, the government has reiterated universal social security coverage to all workers. The benefits would extend to gig workers, platform workers, inter-state migrant workers, building and construction workers, etc., who have now been covered under the Code on Social Security.

The Finance Bill 2021 which was tabled has proposed more than 80 amendments to the Income-tax Act and other related Acts. Some of the major points covered in this Article is the proposal of a Faceless Income Tax Appellate Tribunal Centre, where all communication on tax cases shall be digital, including virtual hearings, if needed. A Dispute Resolution Committee is also proposed for small tax-payers with less than INR 50 Lakhs of annual income and disputes of upto INR 10 Lakhs; monetisation of assets, cleaning up of banks, setting up of an ARC for bad bank debts, privatisation of 2 PSU banks, IPO of LIC in current fiscal – all these are excellent moves in the right direction, hope these do get off from paper and get implemented. If all these proposed changes do get implemented, it would prove to be a truly generation shift – Budget of the decade.

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