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what are the controversial terms in the finance bill 2024?
Controversial Terms in the Finance Bill 2024
1. Taxation of Virtual Digital Assets (VDAs)
Imposition of 30% tax on income from the transfer of VDAs, including cryptocurrencies.
Concerns raised about the lack of clarity in defining VDAs and the potential impact on innovation in the crypto industry.
2. Increase in Minimum Alternate Tax (MAT)
Increase in MAT rate from 15% to 18.5% for companies with book profits exceeding ₹10 crore.
Criticism that it will increase the tax burden on profitable companies and discourage investment.
3. Tax on Employee Stock Options (ESOPs)
Taxation of ESOPs at the time of exercise, instead of the time of sale.
Concerns that it will discourage startups from offering ESOPs as a form of employee compensation.
4. Surcharge on Income from Professions
Imposition of a 10% surcharge on income from professions exceeding ₹50 lakh.
Criticism that it unfairly targets professionals and may discourage entrepreneurship.
5. Tax on Foreign Remittances
Imposition of a 20% tax on remittances exceeding ₹7 lakh per year.
Concerns that it will discourage remittances from overseas Indians and impact the foreign exchange market.
6. Tax on Online Gaming
Imposition of 28% GST on online gaming services.
Concerns that it will stifle the growth of the online gaming industry and lead to job losses.
7. Tax on Non-Resident Indians (NRIs)
Removal of the exemption on interest income earned by NRIs on deposits in Indian banks.
Criticism that it will discourage NRIs from investing in India and impact the flow of foreign capital.
8. Tax on Capital Gains from Sale of Immovable Property
Increase in the holding period for claiming exemption from capital gains tax on the sale of immovable property from 2 years to 3 years.
Concerns that it will discourage real estate investment and impact the housing market.
9. Tax on Dividend Income
Removal of the dividend distribution tax (DDT) and imposition of tax on dividends in the hands of shareholders.
Criticism that it will increase the tax burden on individual investors and reduce the attractiveness of dividend-paying stocks.
10. Tax on Agricultural Income
Proposal to tax agricultural income above a certain threshold.
Concerns that it will discourage agricultural investment and impact the livelihoods of farmers.
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