Lok Sabha passes Finance Bill with Amendments

The Lok Sabha has passed the Finance Bill, 2023 without any discussion after the same was tabled by the Union Minister of Finance and Corporate Affairs, Nirmala Sitharaman today, i.e., March 24, 2023.

Earlier, on Thursday (i.e., March 23, 2023), the Demands for Grants for Budget 2023-24 was passed by the Lower House by way of a voice vote authorising the expenditure of about Rs. 45 lakh crores. Further, the Appropriation Bill, 2023 was also passed by the House on the same day.

The Union Budget was unveiled and the Finance Bill, 2023 was introduced on February 1, 2023, recommending several tax proposals. To bring these financial proposals put forth by the Central Government into effect, the Bill was moved in the Lok Sabha for its consideration and passage today. Certain additions have been made to the Finance Bill and the following amendments have been incorporated: –

• The securities transaction tax (STT) applicable on futures and options contracts would be increased. A tax of 0.0125% shall be levied for futures contracts as opposed to 0.01% and the STT leviable for options contracts has been increased from 0.017% to 0.021%.
• Debt mutual funds with an investment of less than 35% in equity shares of domestic companies would be taxable as short-term capital gains and accordingly taxed as per the investor’s income tax slab rate. Previously, if such funds were held for more than three years, they were taxed as long-term capital gains with indexation benefits.
• Offshore banking units functioning in the Gujarat International Finance Tec-City would be eligible for a 100% deduction on the units’ income for a period of 10 years.
• The tax levied on royalties or fees for technical services paid to non-residents would be increased from 10% to 20%.
• Income from Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) to be taxed as income from other sources (instead of capital gains).