2. 1.Five year tax holiday for :
Power projects
Firms engaged in exports
New industries in notified states & for new industrial
units established
In electronic/ software parks
Export oriented units and in free trade zones
3. 2. Tax deduction of 100% of export profits
3.Deduction of 30% of net income for 10 yrs for new industrial
undertakings
4.Deduction of 50% on foreign exchange earnings by construction
companies,hotels and on royalty,commission etc
5.Deduction in respect of certain inter corporate dividend to the
extend of dividend declared
6.Deduction of an additional amount of Rs.20000 allowed,over and
above the existing limit of Rs.100000 on tax saving,for investment
in long term infrastructure bonds as notified by the central
government
4. 7. Besides contributions to health insurance schemes which is
currently allowed as deduction under the Income tax Act,
8. Current surcharge of 10% on domestic companies reduced to 7.5%
to 18%
9. Rate of minimum alternate increased from the current rate of 15%
to 18% of book profits.
10. To further encourage R&D across all sectors of the
economy,weighted deduction on expenditure incurred on in house R&D
enhanced from 150% to 200% .
11. Payment made to an approved association engaged in research
association ,colleges,universities and other institutions ,for scientific
research enhanced from 125% to 175%.
5. 12. Benefit of investment linked deduction under the Act
extended to new hotels of two star category and above anywhere
in India to boost investment in the tourism sector
13.Allow pending projects to be completed within a period of 5 yrs
instead of 4 yrs for claiming a deduction of their profits,as a one
time interim relief to the housing & real estate sector.
14.Limits for turnover which accounts needs to be audited
enhanced to Rs.60 lakh for business & to Rs.15 lakh for
professions.
15. Limits for turnover for the purpose of presumptive taxation
of small b/s enhanced to Rs.60 lakh
6. 16.If tax has been deducted on payment by way of any expense & is
paid before the due date of filing the return,such expenditure to
be allowed for deduction.
17.To facilitate the conversion of small companies into limited
liability partnerships,transfer of assets as a result of such
conversion not to be subject to capital gains tax
18. the advancement of any other object of general utility to be
considered as charitable purpose even if it involves carrying on of
any activity in the nature of trade,commerce or b/s provided that
the reciept from such activities do not exceed Rs.10 lakh in the yr
19.Proposals on direct taxes estimated to result in a revenue loss of
Rs.26000 cr for the yr.
