Buyers to pay 1% tax on vehicles costing over ₹10 lakh
This is part of the amendments moved by Finance Minister Arun Jaitley to the Finance Bill 2016 and approved by the Lok Sabha on Thursday which makes it clear about who will be liable for tax collection which was unclear in the budget.
Every person, being a seller, who receives any amount as consideration for the sale of a motor vehicle of the value exceeding Rs 10 lakh, shall at the time of receipt of such amount, collect from the buyer a sum equal to 1% of the sale consideration as income tax, said the amendment.
Tweaking the provision relating to additional Dividend Tax, one of the amendments provides for 10 per cent levy becoming payable if the aggregate amount of receipt exceeds Rs 10 lakh.
This essentially means taxpayers whose dividend income crosses Rs 10 lakh would now have to pay an additional dividend tax besides the dividend distribution tax being paid by the company/companies declaring such dividends.
"The amount of income-tax calculated on the income by way of such dividends in aggregate exceeding Rs 10 lakh, will be at the rate of 10%," it said.
On the issue of tax payable in respect of under-reported income, the House approved an amendment that said the tax would be calculated on the "maximum amount" of under-reported income.
"Where no return of income has been furnished and the income has been assessed for the first time, the amount of tax calculated on the under-reported income as increased by the maximum amount not chargeable to tax as if it were the total income, the amendment said.
Previously, the Finance Bill had stated that the tax payable in respect of the under-reported income will be on total income in case of a company, firm or local authority; and at the rate of 30 per cent of the amount of under-reported income, in any other case.