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Interim Budget 2024 – Tax and Policy detailed alert
On Thursday, February 1, 2024, the Hon'ble Finance Minister, Nirmala Sitharaman, unveiled Interim Budget 2024 in the Indian Parliament.
We are pleased to provide you with a consolidated tax and policy alert, summarizing the crucial amendments announced.
Macro-fiscal developments
- 10.5% nominal GDP growth rate estimated for FY25.
- 7% real growth in MoF's estimate (in the review of Indian economy released on 29 January 2024).
- 11.5% growth in gross tax revenues with an assumed buoyancy of 1.09 for FY25.
- 16.9% growth in capital expenditure in FY25.
- 5.1% fiscal deficit budgeted for FY25 with target of 4.5% by FY26.
Corporate tax
- No changes in tax rates.
- Sunset date for certain provisions extended from 31 March 2024 to 31 March 2025 notably for start-ups, IFSC aircraft/ ship leasing units, investment division of non-resident IFSC banking units, sovereign wealth funds and pension funds.
- Codification of changes announced earlier to tax collection at source on LRS remittances and purchase of overseas tour package.
- Withdrawal of small outstanding tax demands pertaining to past tax years up to 2014-15.
Indirect tax
- Goods and Services Tax
- No change in tax rates.
- Input Service Distributor provisions made mandatory.
- Penalty introduced for non-registration of packing machines by manufacturers of tobacco and tobacco-related products.