At present, the Union Budget is eagerly awaited by Indians, as the announcements so made by the Finance Minister on various front specifically on the Income-tax for Individual tax payers. Many relief awaited since long, whether be announced and to what extent. Industrial announcement is also worthy for individuals at many stages to know the impact of new tax structures and policies. The decision on the following issues is expected from the new budget
Discrepancy to be sorted out in “Transfer” of property
The major problem is facing by the individual having immovable property in possession but do not have means or resources to develop and sell for derive more value of such property or not having such strength, time or knowledge to jump into the business of property development. In such a case, the owners enter into the joint development agreement with business houses or people into the business of Real Estate to solve their purpose. The current position as per the Income-tax is that the transfer of the property is happened, when the owner enter into the agreement for joint development and required to pay capital gain tax on the same transaction, while the owner of the property gets its benefit after development and onward sale of such property, normally, it takes 2-3 years of time. Also, sometimes due to various unforeseen reason or reasons, the development is delayed beyond the period fixed or agreement is cancelled in between. The owner of the property is not at all protected in this case and no remedy is available to the owner of the property. The section 2(47) need to be properly amended so that the Transfer of the property is deemed to be completed, in case of joint venture agreement, as and when owner receive the consideration of their property.
Time Extension for reconstruction of property from Long Term Capital Gain
Similarly, if long term capital gain invested in a property under construction, exemption is available on the completion of construction within three years of its sale, the delay in construction by the contractor or otherwise due to unforeseen reasons is happened here too, in such a case, no remedy is available to the tax payer. These provisions should be at par and the construction time should be extended from 3 years to 5 years of time.Abolished tax on Interest income from Bank
At present, Interest income from Saving Bank account is taxed beyond Rs. 10,000.00 annualy. Now a days, saving Bank account is used for all the digital payment purposes through ATMs, Debit Cards and available heavy discounts through online portal on E-commerce and balance stipulation by the Bank cause the individual to maintain higher balance in their saving accounts. Hence, interest accrual is naturally higher today. Hence, the tax should be higher or abolished.
It is also requested from the FM’s that the interest income from Bank Deposits should be abolished at least for the senior citizens as the deposits in the Bank either in SB accounts or in shape of FDs is basically for the need for evening hours after retirement. It is contradictory that until the retirement the PF money and interest thereon are not taxed but when the PF received after retirement and the same is deposited in Bank for the needy time, the interest is taxed after a certain limit. This is hence required the abolition of tax on interest income for senior citizen.