Cen­tral govt may ex­empt some busi­nesses from new TDS rules

Hindustan Times ST (Jaipur) - - Front Page - Ra­jeev Jayaswal ra­[email protected]

NEW DELHI: The govern­ment may ex­empt cer­tain busi­nesses, par­tic­u­larly those deal­ing with farm­ers, from the 2% tax de­ducted at source (TDS) levied on cash with­drawal of over ₹1 crore an­nu­ally, two of­fi­cials aware of the de­vel­op­ment said.

The levy, in­tro­duced in this year’s bud­get to dis­cour­age cash trans­ac­tions, be­came ap­pli­ca­ble from Septem­ber 1. The 2% TDS will be ap­pli­ca­ble from day one on all such with­drawals in case of t h o s e who h a v e a l r e a d y ex­hausted the ₹1 crore limit for the fi­nan­cial year 2019-20, the of­fi­cials cited above said, re­quest­ing anonymity.

The of­fi­cials said the govern­ment is con­sid­er­ing pro­vid­ing relief to some sec­tors, which mostly deal in cash. “Such cases are be­ing re­viewed based on the sec­toral rep­re­sen­ta­tions. A con­sid­ered view will be taken on these mat­ters and some ex­emp­tion could be pro­vided to busi­nesses, where large amounts of cash pay­ments are in­evitable,” said one of the of­fi­cials.

As per the law, the Union govern­ment has the power to ex­empt cer­tain in­di­vid­u­als or cer­tain sec­tors from TDS in con­sul­ta­tion with the Re­serve Bank of In­dia (RBI), a sec­ond of­fi­cial said.

Spokesper­sons for the fi­nance

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