The Finance Bill, 2023 was approved by the Lok Sabha on Friday, March 24, with a few changes. In the midst of protests by opposition lawmakers calling for a JPC investigation into the Adani Group issue, Union Finance Minister Nirmala Sitharaman introduced “The Finance Bill, 2023” in the lower house.
The Finance Bill, which she officially amended 64 times, was presented to Parliament on February 1 along with the Budget plans.
According to the news agency ANI, FM Sitharaman stated that a committee on the pension system will be established under the Finance Secretary to address the demands of employees and uphold budgetary responsibility.
The minister further stated that the RBI will look into the concerns relating to credit card payments for international visits not being captured under the Liberalized Remittances Scheme while introducing the Finance Bill 2023 in the Lok Sabha for consideration and passage (LRS).
The national pension system for public employees needs to be changed, according on representations made, Sitharaman stated.
The minister added that it has been discovered that payments made for international travel using credit cards are not recorded under LRS and that such payments avoid tax collection at the source.
She said, “RBI is being asked to look into this with a view to putting credit card payments for international tours within the ambit of LRS and tax collection at source from now on.”
See below for changes made to The Finance Bill 2023:
1) Indexation benefits for mutual funds with less than 35% of AUM in domestic equities will be lost, and they will be subject to short-term capital gains tax.
2) Expansion of tax incentives for offshore banking entities working in GIFT city, including a 100% income tax deduction for ten years.
3) A 20% tax was added to foreign (non-resident) corporations’ royalties and technical fees, up from 10%.
4) The tax rate on non-par savings insurance products remains the same at 5 lakh.
5) Despite claims to the contrary, there is no change in the taxation of REITS/InviTs (REITs’ income will be taxed as “income from other sources,” not as capital gains).
6) The securities transaction tax (STT) on the selling of options has increased to $2,100 on a turnover of $1 crore from $1,700 previously, a 23.5% increase, while the STT on the sale of futures contracts has climbed to $12,500 on a turnover of $1 crore from $10,000 previously, a 25% increase.
