UNION Budget 2021

By Krupa Venkatesh, Partner & Chief Catalyst, Tax & Technology, Consark Advisory Services LLP

This budget has been presented under truly unprecedented circumstances, global and domestic, and the focus on healthcare is a sufficient reflection of the same. Big announcements such as the LIC IPO, FDI limit hike for the insurance industry, and the creation of the ARC-equivalent of a bad bank have dominated post budget discussions. It is commendable that, even under this tough situation, there is no extra burden cast on the citizens via taxes or levies/cess to augment the Government’s finances. Equally, mention-worthy is the commitment to make tax compliance easier through measures like:

• Limiting re-opening of assessments to three years,

• Faceless Tribunals,

• Impetus to Dispute Settlements,

• Faster processing of returns and completion of assessments

• Assurance to streamline GST further, with special mention on an inverted tax structure

• Putting together a new customs structure with no distortions

• Reliance on self-certification in GST returns, to name a few

Such changes in the tax administration and implementation of the tax laws often do not get the attention they deserve though their impact is sometimes more far-reaching and sustainable than the actual changes in tax rates.

As with every budget, there are fine details in the tax proposals. In our presentation, we have tried to focus on those aspects which may not necessarily be widely discussed, but which have wide application. We have refrained from covering in detail changes that are very specific such as changes in customs duties. We would be more than happy to discuss any specific provisions with the readers who may reach us using this form.