As always, the devil is in the fine print and budget 2015 is no exception. Here are some of the key examples:
> The FM has announced additional surcharge of 2 per cent for individuals and other non-corporates having income exceeding Rs 1 crore. As education cess is payable on total tax and surcharge, the effective surcharge has gone up by 2.06 per cent. Thus, there is an increase in maximum marginal rate to 34.6 per cent from 33.99 per cent.
> Section 192 is proposed to be amended to make employer responsible for obtaining evidence of deductions/exemptions/set-off of certain losses of employees for computing the TDS amount. Specific rules prescribing the form and manner in which such evidence may be collected are likely to be announced.
> Currently, interest from recurring deposits is not subject to tax deduction at source. However, it has been proposed that such interest will also be subject to tax deduction at source in case the total interest exceeds Rs 10,000 at the rate of 10 per cent. The proposed amendment is effective from June 1, 2015.
> Many of us were excited when the PM Modi launched the Swachh Bharat Abhiyan on October 2, 2014 and nominated nine people to participate and asked them to further nominate nine people. The nomination does not end here. Now, finance minister Arun Jaitley has nominated almost all of us to contribute and participate in the campaign as he has proposed to levy a 2 per cent Swachh Bharat Cess on all or any service in addition to 14 per cent service tax (resulting in a 16 per cent service tax).
> While Pranabda hit the 'super rich' with a surcharge of 10 per cent, Jaitley didn't seem to be in any considerate mood either, levying an additional surcharge of 2 per cent thereby increasing the surcharge to 12 per cent where the total income exceeds Rs 1 crore.
> India Inc celebrated the reduction of the corporate tax rate to 25 per cent from 30 per cent but the cheer died down almost immediately as the FM said "over the next 4 years" and this phasing in fact begins from fiscal 2016-17. Corporate tax rate continues to be the same at 30 per cent for the current year. In fact, the increase in surcharge for the 2015-16 fiscal actually results in an increase in the effective tax rate, albeit marginally. For instance, the effective corporate tax rate for domestic companies having income exceeding Rs 10 crore would increase from 33.99 per cent to 34.60 per cent.
> Jaitely seems to have taken 'Atithi Devo Bhava' too seriously. The surcharge on corporate tax rate for non-residents has remained constant while domestic taxpayers have been hit with an increase in surcharge from 5 per cent to 7 per cent (where income is less than Rs 10 crore) and 10 per cent to 12 per cent (where income exceeds Rs 10 crore).
> For claiming foreign tax credit and for making a payment to non- residents without deduction of tax, the Indian taxpayer has to furnish details 'to be prescribed' and if she does not do so, the sword of 'penalty' is on her head.
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> The FM has announced additional surcharge of 2 per cent for individuals and other non-corporates having income exceeding Rs 1 crore. As education cess is payable on total tax and surcharge, the effective surcharge has gone up by 2.06 per cent. Thus, there is an increase in maximum marginal rate to 34.6 per cent from 33.99 per cent.
> Section 192 is proposed to be amended to make employer responsible for obtaining evidence of deductions/exemptions/set-off of certain losses of employees for computing the TDS amount. Specific rules prescribing the form and manner in which such evidence may be collected are likely to be announced.
> Currently, interest from recurring deposits is not subject to tax deduction at source. However, it has been proposed that such interest will also be subject to tax deduction at source in case the total interest exceeds Rs 10,000 at the rate of 10 per cent. The proposed amendment is effective from June 1, 2015.
> Many of us were excited when the PM Modi launched the Swachh Bharat Abhiyan on October 2, 2014 and nominated nine people to participate and asked them to further nominate nine people. The nomination does not end here. Now, finance minister Arun Jaitley has nominated almost all of us to contribute and participate in the campaign as he has proposed to levy a 2 per cent Swachh Bharat Cess on all or any service in addition to 14 per cent service tax (resulting in a 16 per cent service tax).
> While Pranabda hit the 'super rich' with a surcharge of 10 per cent, Jaitley didn't seem to be in any considerate mood either, levying an additional surcharge of 2 per cent thereby increasing the surcharge to 12 per cent where the total income exceeds Rs 1 crore.
> India Inc celebrated the reduction of the corporate tax rate to 25 per cent from 30 per cent but the cheer died down almost immediately as the FM said "over the next 4 years" and this phasing in fact begins from fiscal 2016-17. Corporate tax rate continues to be the same at 30 per cent for the current year. In fact, the increase in surcharge for the 2015-16 fiscal actually results in an increase in the effective tax rate, albeit marginally. For instance, the effective corporate tax rate for domestic companies having income exceeding Rs 10 crore would increase from 33.99 per cent to 34.60 per cent.
> Jaitely seems to have taken 'Atithi Devo Bhava' too seriously. The surcharge on corporate tax rate for non-residents has remained constant while domestic taxpayers have been hit with an increase in surcharge from 5 per cent to 7 per cent (where income is less than Rs 10 crore) and 10 per cent to 12 per cent (where income exceeds Rs 10 crore).
> For claiming foreign tax credit and for making a payment to non- residents without deduction of tax, the Indian taxpayer has to furnish details 'to be prescribed' and if she does not do so, the sword of 'penalty' is on her head.
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