Govt has not renewed angel tax for startups: Central Board of Direct Taxes chairman Nitin Gupta
Board of Direct Taxes chief talks about future of old tax regime, carve-outs made for start-ups in angel tax in Budget
Published: 05th February 2023 10:32 AM | Last Updated: 05th February 2023 10:32 AM | A+A A-
Nitin Gupta, Chairman of the Central Board of Direct Taxes (CBDT) in interaction with TNIE explains some of the major changes in tax laws introduced in the India Budget 2023.
What is the future of the old tax regime now with the new tax system being made the default option?
The old tax system is intact. There is no change in the old tax regime. Through the new tax system, we are offering taxpayers something very unique which will help them in tax savings. The ball is in the court of taxpayers to choose from both options. Also, the new tax scheme proposed in the budget is beneficial for everyone, including those earning `5-7 lakh, as they will get tax exemption.
Experts are of the view that the old tax regime is still better for those who have home loans and other investments like insurance, EPF etc? What would you like to say on that?
Those who are taking exemptions on house property, it could be different (for them) but those who are taking exemptions only under 80C and 80D, then the new regime would be more beneficial.
What was the rationale behind taxing life insurance policies with premiums more than Rs 5 lakh per annum?
We wanted to plug the loopholes in the taxation system. Life insurance products are quite popular, so we kept the threshold of `5 lakh unlike ULIPs in which the minimum threshold for taxability is `2.5 lakh per annum.
Can we say TCS and TDS have become tools for collecting advance taxes rather than a mechanism to track transactions as it as the case earlier?
Yes, you can say so. Also, it is not pinching the taxpayers this way. Whatever you are paying later, we are asking to pay upfront. They can adjust their tax liability for the remaining part of the year.
The budget has amended the law to make the share premium received over fair value from non-residents taxable in the hands of the company. Start-ups have been complaining that the government has re-introduced angel tax in the Budget?
Let them read the law properly. The amendment does not change anything for exempted start-ups. Some carve-outs have been made under the law which exempts start-ups from the said tax. But if they have any genuine concern, we will look at it.
The government has also amended the law to make three trusts named after members of the Gandhi family ineligible for income tax benefits. What was the reason for this move?
How does a trust get 80G benefit? They get themselves registered under section 12A, seek the benefit of 80G registration and 80G is granted. Those three trusts are already registered under section 12A, so they will have to come under the regular regime of 80G in the normal course with the approval of the commissioner. They are already under 12A, so they have to come to a regular regime of 80G. That automatic thing goes away for three.