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Top India Union Budget 2021-22 expectations

1. Relief for the salaried class: Relief in the form of an increased standard deduction or exemptions for allowances / benefits to facilitate work from home may be considered

2. Covid treatment relief: Given the substantial cost involved in Covid-19 treatment in Government or private hospitals, a separate deduction of up to INR 1,00,000 for Covid-19 treatment expenses incurred for the taxpayer or his family may be considered

3. Boosting liquidity through lower TDS Rates: The Government may consider maintaining TDS at 75 percent of the applicable rates for the coming fiscal year also

4. Incentivising R&D: The Government should consider reinstating the weighted deduction for R&D expenses to incentivise innovation

5. Boosting lending by NBFCs: NBFCs can be exempted from thin capitalization norms in order to provide a level playing field with Banks

6. Changes in the Equalisation Levy Regime: The Government could consider changes in the expanded equalisation levy regime to provide greater clarity, avoid double-taxation and enable access to dispute resolution mechanisms

7. Clarifications in Tax Collection at Source provisions: All transactions in shares, securities and other financial instruments can be kept outside the purview of TCS provisions

8. Relaxations in Transfer Pricing norms: The Government could consider rationalizing safe harbour norms and simplifying taxpayer compliances

9. Roll out of Customs amnesty scheme to resolve the legacy disputes under customs & trade law – considering the urgent need for bolstering the revenue, in the spirit of trade facilitation and to align with amnesty scheme under other central taxes (Vivad se Vishwas tak), government may come up with customs amnesty scheme also

10. Reduction in interest rate on delayed payment of customs duty -  The last interest rate revision to 15% was made effective in 2016 and RBI has dramatically reduced the repo rates over past five years. The interest rate reduction has been passed on by the banks and hence it is expected that interest rate reduction is passed on through change in tax & trade law. 

11. Petroleum under GST: Policy announcement on bringing Petroleum products under GST

12. The Government could introduce tariff and non-tariff barriers to protect / promote local Industries / manufacturing

13. Withdrawal / rationalization of criminal provisions under various acts