Lok Sabha passes Finance Bill without debate amid Opposition's ruckus
What's the story
The Lok Sabha passed the Finance Bill 2023 on Friday without debate as Opposition MPs raised slogans demanding a Joint Parliamentary Committee (JPC) to probe the allegations of fraud against the Adani Group. The Bill, which gives effect to the government's financial proposals for the fiscal year 2023-24, was passed with over 45 amendments and the addition of 20 new sections.
Context
Why does this story matter?
The second phase of the Budget Session is underway and will go on until April 6. On Thursday, the Lok Sabha passed the demand for grants amounting to Rs. 45 lakh crore for the financial year 2023-24. The demand for grants was cleared after the assessment by the department-related Parliamentary Standing Committees and their subsequent reports to the corresponding ministries and departments.
Amendments
No tax benefit for debt mutual funds below 35% investment
Debt mutual funds will not receive the long-term tax benefit and attract short-term capital gains tax if their investment in equities is less than 35% of their assets. Meanwhile, pension fund investments will be exempt from taxation under infrastructure investment trusts (InvITs). InvIRs are investment instruments that function like mutual funds and are regulated by the Securities and Exchange Board of India (SEBI).
Taxes
Securities Transaction Tax hiked
The Securities Transaction Tax (STT) on the sale of options on a turnover of Rs. 1 crore has been raised by 23.5% from Rs. 1,700 to Rs. 2,100. Additionally, the STT on the sale of futures contracts on a turnover of Rs. 1 crore has been increased by 25% from Rs. 10,000 to Rs. 12,500.
Startups
No relief for startups regarding angel tax provision
No respite was provided to startups regarding the proposed changes in the angel tax regime announced in the Union Budget last month. This is likely to hamper foreign funding for entrepreneurs and nascent firms. According to the amendments made in the Finance Bill, the proposed changes will come into effect from Financial Year 2023-24 and Assessment Year 2024-25.
Ruckus
Lok Sabha approved Rs. 45 lakh-crore budget in 12 minutes
Notably, the Lok Sabha approved the budget of Rs. 45 lakh crore for the fiscal year beginning April 1 without debate on Thursday as well. After two adjournments, the Lower House of Parliament resumed debate on the Demands for Grants and Appropriation Bills, as the ruling and opposition MPs clashed over Rahul Gandhi's apology and the Adani issue. The entire exercise took 12 minutes.