Union Finance Minister Arun Jaitley on Monday said small businesses and workshop owners with turnover of less than Rs 2 crore will have to pay less tax if they accept digital payments, ANI reported. He said a new notification had been issued amending the order which was earlier announced during the 2016-2017 Budget session.
Under the Presumptive Taxation Scheme under 44AD of the Income Tax Act, 1961, small businesses with turnover of Rs 2 crore or less are taxed on 8% of the total turnover. The government has now proposed to reduce this to 6% for those who would accept digital modes of payment, Jaitley said.
Jaitley also said the scrapped Rs 500 and Rs 1,000 notes will no longer be allowed to trade, however, they can still be deposited in banks till December 30. “The Rs 5,000 limit does not apply to anyone who goes and deposits the amount once. But if the same person is going everyday, that may give rise to suspicion,” he said. He requested everyone to deposit old currency notes soon as all the exemptions have been waived.
On Monday morning, the Ministry of Finance had announced that deposits above Rs 5,000 in scrapped currency notes would be restricted to once per account until December 30. Minister of State for Finance and Corporate Affairs Arjun Ram Meghwal said the withdrawal cap will be lifted from December 30.
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