The new buyers of the automobiles will have to provide 1 per cent tax extra to the seller himself if the cost of the vehicle is over ten lakh rupees. This was part of Finance Bill 2016 as the Finance Minister Arun Jaitley moved to get approval from the Lok Sabha on Thursday. As the amendment was sanctioned, it’s now clear that who will be responsible for the collection of the tax which was in doubt when the budget came into light.
A main amendment for providing 10 per cent charge becoming payable if the cumulative amount surges beyond 10 lakh is a revision regarding the additional Dividend Tax. What it actually implies is that the tax payers with dividend income exceeding Rs. 10 lakh would now have to make do with paying an extra dividend tax along with the dividend distribution tax paid by the declaring company.
With regards to the under reported income, it’s been approved that the tax will only be calculated on the maximum amount of that particular income. The Finance Bill has previously stated that the payable tax with respect to the under-reported income will depend on the total income of the related local authority or company or firm. It will at a rate of 30 per cent of the under-reported income’s amount in cases otherwise.
The Union Budget 2016 regarding the automotive industry came as a hammer blow for the sales of passenger vehicles across all segments in the Indian market. The one per cent of infrastructure cess has been implied on vehicles powered by petrol, CNG (Compressed Natural Gas) and LPG (Liquefied Petroleum Gas).
The cars with diesel powerplants will have to bear 2.5 per cent tax regardless of the displacement and the price range. Lastly, there’s one per cent additional tax levied on the premium and luxury sedans costing over 10 lakh rupees while the luxury SUVs will have to bite the extra four per cent ‘high capacity’ tax enforced.