A slew of budgetary proposals, including 0.5 per cent agriculture cess on all services and a 4-month disclosure scheme for domestic black money holders to come clean, will kick in on Wednesday.
The Equalisation levy of 6 per cent on cross border digital transactions and a one time settlement tax scheme for resolving disputes emanating from retrospective amendments to the Income Tax Act will also come into effect on Wednesday. With the imposition of Krishi Kalyan Cess (KKC), the total incidence of service tax will increase to 15 per cent, thus making eating out, phone usage, air and rail travel, expensive. The 4-month Income Declaration Scheme provides one time opportunity to domestic black money holders to come clean by paying tax and penalty of 45 per cent on such assets will open tomorrow.
However, the scheme is not meant for those who have earned money through corruption. last year the government had launched a similar scheme giving opportunity to people having unaccounted assets abroad to come clean by paying taxes and penalty.