Budget 2020: Key Takeaways of Indirect Tax Proposals

In a Union Budget 2020 presented today, the Union Finance Minister Smt. Nirmala Sitharaman has proposed the various Indirect Tax Proposals.
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GST:

1. Cash reward system envisaged incentivizing customers to seek invoices.
2. Simplified return with features like SMS based filing for nil return and improved input tax credit (ITC) flow to be implemented from 1st April 2020 as a pilot run.
3. Dynamic QR-code capturing GST parameters proposed for consumer invoices.
4. Electronic invoices to capture critical information in a centralized system to be implemented in a phased manner.
5. Aadhaar based verification of taxpayers being introduced to weed out a dummy or non-existent units.
6. GST rate structure being deliberated to address inverted duty structure.

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Customs Duties:

1. Customs duty raised on footwear to 35% from 25% and on furniture goods to 25% from 20%.
2. Basic customs duty on imports of newsprint and light-weight coated paper reduced from 10% to 5%.
3. Customs duty rates revised on electric vehicles and parts of mobiles.
4. 5% health cess to be imposed on the imports of medical devices, except those exempt from BCD.
5. Lower customs duty on certain inputs and raw materials like a fuse, chemicals, and plastics.
6. Higher customs duty on certain goods like auto-parts, chemicals, etc. which are also being made domestically.
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Trade Policy Measures

1. Customs Act is amended to enable proper checks of imports under FTAs.
2. Rules of Origin requirements to be reviewed for certain sensitive items.
3. Provisions relating to safeguarding duties to be strengthened to enable regulating such a surge in imports in a systematic way of indirect tax proposals.
4. Provisions for checking to dump of goods and imports of subsidized goods being strengthened.
5. Suggestions for reviews of exemptions from customs duty to be crowd-sourced.
6. Excise duty proposed to be raised on Cigarettes and other tobacco products, no change made in the duty rates of bidis.
7. Anti-dumping duty on PTA abolished to benefit the textile sector.

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Unprecedented Milestones and Achievements of Indian Economy

1. India now the fifth largest economy in the world.
2. 4% average growth clocked during 2014-19 with inflation averaging around 4.5%.
3. 271 million people raised out of poverty during the 2006-16.
4. India‟s Foreign Direct Investment (FDI) elevated to US$ 284 billion during 2014-19 from US$ 190 billion during 2009-14.
5. Central Government debt reduced to 48.7% of GDP (March 2019) from 52.2% (March 2014).
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   Two cross-cutting developments: Proliferation of technologies (Analytics, Machine Learning, robotics, Bioinformatics, and Artificial Intelligence).

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1. 1. BUDGET SPEECH
   2. FINANCE BILL 2020
   3. MEMORANDUM
   4. PPT ON BUDGET
   5. HIGHLIGHTS-BUDGET 2020
   6. PPT ON BUDGET 2020