The Hindu Business Line : Taking Count

For those who made merry making quick bucks in the market, the taxman is ready to extract more from you. Short-term capital gains, both on the transfer of shares and equity oriented mutual funds will now be taxed at 15 per cent, up from the current 10 per cent. So, the next time you get tempted by market gyrations, remember, it is best to stay invested for at least a year.

PAN needed for all transactions

Is the equity market giving you sleepless nights? If you decide to play it safe and invest in debt market instruments, you may now need to flash your PAN card to do so. Ditto when paying insurance premiums or taking personal loans. By making PAN mandatory for all financial transactions, this budget has taken a step further towards not only making PAN the sole ID for these transactions, but also casting the IT department’s net wider.

No check on the ‘big’ withdrawals

From April 1, 2009, the 0.1 per cent tax on withdrawals over

Rs 50,000 on a single day (from an account other than a savings account) and the receipt of cash exceeding the same amount on encashment of one or more term deposits will be done away with. Introduced to keep track of ‘big-ticket’ transact ions and curb black money, the withdrawal implies that the government’s objectives have been met.

FBT on ESOPs

If you are working abroad, but for a company based in India, your employer might have recovered FBT from your ESOPs. Had you been paying taxes, in the foreign country, you might not have been able to claim credit for FBT suffered by you, as it is a corporate level tax. This anomaly now stands corrected.

The Finance Minister has proposed that such recovery of FBT from employees will be deemed to be personal income tax paid by the employee. This amendment is retrospective and will apply to any FBT recovered after 1 April 2007. So, hurry! Check with your employer right away!

Bye-bye service tax

Caught in the service tax net just because you were raking in a little more than Rs 8 lakh , the threshold limit? There’s some good news in the budget. The annual limit has now been raised to Rs 10 lakh. You will now join over 50,000 other small service providers like you in your way out. Lucky you!

And now, commodities transaction tax

Any purchase or sale of an option in goods, an option in commodity derivative or any other commodity derivative will now attract a commodities transaction tax of 0.017 per cent of the option premium or the cost of commodity derivative for the seller and 0.125 per cent of the settlement price for the buyer. So, those trading in commodities may now have to put up with higher transaction costs.

BL RESEARCH BUREAU

More Stories on : Budget | Stock Markets | Taxation

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page