Concessional Tax, Rs 3 Crore TDS Limit In Tax Relief For Cooperative Sector

To promote the cooperative sector, the government on Wednesday announced a slew of measures, including a concessional tax of 15 per cent to promote new societies focusing on manufacturing and a higher limit of Rs 3 crore for TDS on cash withdrawal..For the cooperation ministry, the government made a total budget outlay of Rs 1,150.38 crore for 2023-24, lower than the revised estimate of Rs 1,624.74 crore for 2022-23..In her budget speech, Finance Minister Nirmala Sitharaman announced a higher limit of Rs 2 lakh per member for cash deposits and loans in cash by Primary Agricultural Co-operative Societies (PACS) and Primary Co-operative Agriculture and Rural Development Banks (PCARDBs)..The government also provided an opportunity to sugar cooperatives to claim payments made to cane growers for the period prior to the assessment year 2016-17 as expenditure. This is expected to provide them with a relief of almost Rs 10,000 crore..These measures come amid the government promoting a cooperative-based economic development model, especially for small and marginal farmers, and other marginalised sections..To realise the vision of 'Sahakar Se Samriddhi', Sitharaman said the government has already initiated computerisation of 63,000 Primary Agricultural Credit Societies (PACS) with an investment of Rs 2,516 crore..In consultation with all stakeholders and states, model bye-laws for PACS were formulated enabling them to become multipurpose PACS. A national cooperative database is being prepared for country-wide mapping of cooperative societies.."With this backdrop, we will implement a plan to set up massive decentralised storage capacity," Sitharaman said, adding that this will help farmers store their produce and realize remunerative prices through sale at appropriate times..The government will also facilitate setting up of a large number of multipurpose cooperative societies, primary fishery societies and dairy cooperative societies in uncovered panchayats and villages in the next five years, she said..In order to promote the growth of manufacturing in cooperative sector, the finance minister said a new cooperative society formed on or after April 2023, which commences manufacturing or production by March 2024 and do not avail of any specified incentive or deduction, is proposed to be allowed an option to pay tax at a concessional rate of 15 per cent similar to what is available to new manufacturing companies..Another major relief is that the government will amend section 269SS and 269T of the Companies Act to ensure there is no penalty for cash loan/transactions against primary co-operatives in cash less than Rs 2 lakh..The government has also increased the threshold limit for cooperatives to withdraw cash without TDS. "It is proposed to enable co-operatives to withdraw cash up to Rs 3 crore in a year without being subjected to TDS on such withdrawal," the FM said..Giving relief to sugar co-operatives from past demand, the FM said the government provided an opportunity to sugar co-operatives to claim payments made to cane growers for the period prior to the assessment year 2016-17 as expenditure.."....for years prior to 2016-17, if any deduction claimed for expenditure made on the purchase of sugar has been disallowed, an application may be made to the Assessing Officer, who shall recompute the income of the relevant previous year after allowing such deduction up to the price fixed or approved by the government for such previous year," she added.

Concessional Tax, Rs 3 Crore TDS Limit In Tax Relief For Cooperative Sector

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