In a relief to the farm sector, the government has decided not to levy 2 percent tax deduction at source on cash payments of over Rs 1 crore made through Agriculture Produce Market Committees.
The government had made the provision of levying 2 percent TDS on cash withdrawals exceeding Rs 1 crore in the Union Budget with an aim to discourage cash transactions and move towards a less-cash economy.
The provision is set to come into force from Oct. 1.
“Addressing the concerns raised by Agriculture Produce Market Committees, it has been decided not to levy the 2 percent TDS on cash payments above Rs 1 crore made through APMCs, in order to make immediate payments to farmers for their produce,” Finance Minister Nirmala Sitharaman said in a tweet.
Meanwhile, in another tweet, the minister said an additional 15 percent depreciation will be allowed on motor vehicles purchased between Aug. 23, 2019, and March 31, 2020.
She had made this announcement on Aug. 23 as part of measures to boost the economy.
“The move is expected to give a boost to the automobile sector by driving sales,” she added.
The depreciation on cars purchased during the period will be 30 per cent as against the normal rate of 15 percent.
While in the case of buses, lorries and taxis, the depreciation rate has been enhanced to 45 percent from 30 percent. Depreciation helps companies reduce tax liabilities.
Farm expert Vijay Sardana commented that the exemption to APMCs will benefit traders but not farmers.
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