Union Budget 2014-15 Reactions: Daksha Baxi, Executive Director, Khaitan & Co
Provision of Pass Through Tax Status to Business Trusts
This is a major change in tax policy. Deferring the capital gains tax in the hands of the sponsor upon transfer of assets to REITS, according the same tax treatment to sale of REITS units as given to equity shares traded on stock exchanges and providing pass through tax status to the REITS and Business Trusts will provide the needed clarity to bring success to the much needed REITS regime which is awaiting notification by the SEBI”.
Real Estate Sector: "Another good boost to the real estate sector is reduction of the minimum built up area from 50,000 square meters to 20,000 square meters and reducing the minimum capitalisation from UD 10 million to 5 million for eligibility of FDI."
Manufacturing Sector: "To boost the manufacturing sector, especially the SME sector, the 15% investment allowance has been extended to investment in plant and machinery of Rs. 25 crore if made within the next 3 years. This, along with certain other changes to labour laws, should provide a boost to the manufacturing sector. Doing away with MAT to SEZ units and SEZ developers would have boosted manufacturing sector further.