The Hindu Business Line : Realistic restructuring

The Budget 2009 has been a realistic attempt at restructuring a few structural anomalies. It simplified procedures in respect of small businesses with turnover up to Rs 40 lakh. They could declare their income at the rate of 8 per cent of their turnover and, what is more, neither need to pay advance tax nor maintain books of accounts. This new scheme will be effective from financial year 2010-11.

In respect of anonymous donations to charitable organisations, the Finance Minister has granted relief by not taxing them to the extent of 5 per cent of their total income, or Rs 1 lakh, whichever is higher.

The proposal to merge the two authorities for advance rulings on direct and indirect taxes by making suitable amendments in the Act will be an added convenience, and a time-saver, for all concerned.

The Budget plans to centralise the transfer price dispute resolution. This would reduce reference to courts, minimise unwanted expenditure and save time and resources.

The reintroduction of simplified ‘saral’ form is a good move.

And, lastly, the statement that the Central government will facilitate the introduction of GST by April 1, 2010 is welcome.

Hopefully, the simplification of these procedures should go some way towards better compliance. In India, cultivation of tax-paying attitude is very important; simplification should enable this.

K. U. Mada Mumbai