Lok Sabha Adopts FY 2019-20 Finance Bill by “Voice Vote with 07 amendments

Sarkaritel
By Sarkaritel July 19, 2019 06:07


By TN Ashok

New Delhi , July 18 : Finance Minister Ms Nirmala Sitharaman today told the Lok Sabha that the finance bill giving effect to budget FY 2019-20 recommendation primarily aimed at a “ease of living for the tax payers and  easing their pain ““by simplifying the taxation structur,  even as she assured the house the “Direct Taxes Code” will  be taken a serious look  by the government by the month end.

The New Direct Taxes Code is to come up before the government by July 31st this year and “We will definitely take a call on this “, she said while replying to Ms Supriya Sule and others after a 17 hours 37 minute debate on the finance bil, considered one of the longest in the house. The lok sabha adopted the bill by a voice vote after rejecting two major amendments moved by RSP’s NK Premachandran to reduce the levy on petrol and diesel which was making the live of the common man difficult. The house also rejected BJD Bahtruhari Mahtab’s amendment to withdraw the 10% import duty slapped on imported newsprint as it would wipe out the small and medium newspapers as domestic supply of newsprint had dried up.

Now the Rajya Sabha has to return the money bill before it gets presidential assent to become law.

The finance minister also laid on the table of the house seven major amendments to legislations relating to laws governing indirect taxation to ensure greater simplicity. She told the Lower House that amendments to Income Tax laws were being made through the Finance Bill in five major categories, mostly relating to the Goods and Services Tax (GST).

Apart from seven Acts related to indirect taxation being amended, the government also be bringing changes to seven laws related to direct taxation. The changes would ensure that indirect taxation-related matter would have greater simplicity and be effective, she said. About proposed amendments to direct taxation-related laws, Sitharaman said those are being done for furthering the agenda of Make in India, adding the country needs a lot more manufacturing activities.

The GST alone has five different amendments that would also make compliance easier for the MSME (Micro, Small and Medium Enterprises) sector, she said adding eight Acts pertaining to financial markets, including SEBI  Act, are being amended. RSP member N K Premachandran objected to the Finance Bill having the provisions to amend a number of laws, including Benami Act, Sebi Act and PMLA Act, and urged Speaker Om Birla to disallow it. He accused the government of bypassing Parliament to avoid discussion and scrutiny for amending existing laws by including them in the bill.

The Finance Minister rebutted Premachandran’s observation saying they came under the purview of the financial system and had to be included because it needed the approval of the house and hence became a part of the Finance Bill. used the government of bypassing Parliament to avoid discussion and scrutiny for amending existing laws by including them in the bill.

Sitharaman said rules and constitutional provisions cited by Premchandran do not rule out non-taxation proposals for inclusion in the Finance Bill but only say that it should be done only when imperative. The government considers it very imperative,” she asserted.

Birla, in his ruling, disallowed Premachandran’s objections and said there have been occasions earlier as well when non-taxation proposals were included in the Finance Bill.

Government has been taking several steps to bring more people under the tax net and the IT department gathers data from a wide variety of sources, including on investments and high-value transactions, analysing them to assess if a person should pay tax, and he is paying his due of taxes in compliance with the legal provisions under the IT act.  whether he is paying the right amount of tax.

In this Budget, too, there were a number of measures aimed at plugging tax leakages and ensuring greater compliance. Four conditions for filing of returns: If a person’s income exceeds the basic exemption limit, he must file tax return.

The Finance Minister said the tax proposals in the Finance Bill 2019 were aimed at improving the ease of living and reducing pain of the citizens and the budget proposals will will promote Make in India and digital payment.

Ms Nirmala Sitharama  declined to yield on the demand for relaxation of tax proposals regarding Foreign Portfolio Investors (FPIs) , TDS on cash withdrawal above Rs 1 crore from banks and hike in customs duty on newsprint as demanded by opposition. The tax on withdrawal of cash over rs one crore in a year is on high net worth individuals, she clarified.

FPI’s will not be affected by this taxation and there is fear of “flight of capital “from portfolio investors , she said clarifying that FPIs are cos and the tax is on HNIs who own trusts who become liable.

The finance minister also revisited the 2002 Prevention of Money Laundering ACT (PMLA) and proposed eight amendments and said six of them were in the nature of explanatory memorandum to the 2002 law so that no undue advantage was taken by anybody due to any prevailing confusion in the applicability of the law and there was any leakage of taxes.

Referring to imposition of 2 per cent TDS on cash withdrawal beyond Rs 1 crore, she said the tax could be adjusted against the liability of the assesses and hence there will be no additional burden on them. On the proposal to hike tax liability on individuals earning more than Rs 2 crore, she said it will not impact FPIs provided they organised themselves as company.

With regard to simplification of tax laws, the Ministry has already set up a task force to finalise a new Direct Tax Code (DTC), she said.

She also referred to amendments in the finance bill to give more teeth to federal bank, namely the RBI, to arm itself with more regulatory powers to check the conduct of non banking financial banks (NBFCs). Primary among the powers are that RBI can supersede the NBFC in the event of any financial improprietary, or even split the NBFC.

With the passage of the finance bills, the lower house of parliament has concluded a major exercise of the budget session , which for the first time went without a recess , during which standing committees of parliament examined in depth the provisions and the demand of grants for various departments, before returning them to the finance ministry for adoption in the house. As a new government is in place , most of the standing committees are being recon stituted leading to an extraordinary situation of skipping the recess when such an exercise used to take place.

feedback@ashoktnex@gmail.com

Sarkaritel
By Sarkaritel July 19, 2019 06:07