Super-rich tax withdrawn; home, auto loans to be cheaper: FM Sitharaman

New Delhi: Finance Minister Nirmala Sitharaman broke her silence today and made a number of announcements to revive economic growth as the country faces a slowdown. At a press brief, she said India's growth rate is "higher than everybody else" and "more than US and China". 

Sitharaman passed the onus of the slowing economy on ''US-China trade war'' and ''currency devaluation''. ''Very volatile situation has developed in global trade,'' Sitharaman said.

The finance ministry had increased the effective tax rate on individuals with taxable annual income of above Rs 2 crore rupees by about 3 pc, and for those earning above Rs 5 crore by 7 pc.

Foreign Portfolio Investors had become the unintended target of the higher surcharge on the super rich and was widely seek to have contributed to foreigners withdrawing more than USD 3 billion from Indian stocks, reported Hindustan Times.

The enhanced surcharge on foreign portfolio investors levied in the Budget has also been withdrawn. Surcharge on long and short term capital gains made from transfer of equity shared has also been withdrawn. "Pre-budget position is restored," Nirmala Sitharaman said.

She also said, "All pending GST refund due to Ministry of Micro, Small and Medium Enterprises (MSME) will be paid in 30 days from today. In future every refund will be done in 60 days."

In a press conference, Sitharaman emphasized the needs of wealth creators. She mentioned that respect for wealth creators was the spirit of the budget for FY20 and consultations with different sectors was done to understand their needs.

Showing optimism, Sitharaman shared the government's plan for reviving the economy. ''Reform is on top of government's agenda. The reform process will continue, we haven't lost momentum,'' she said.

She informed that government will infuse upfront Rs 70,000 crore into public sector banks which will enable the release of Rs 5 lakh crore liquidity in the market.

Finance Minister proposed the government's plan on bringing tax reform to end harassment of taxpayers. ''All tax notices to be issued from a centralised system,'' she said. ''All old tax notices will be decided by Oct 1 or will be uploaded again through the centralised system,'' she added.

In a relief to loan seekers, she said, "Banks will make home, auto loans cheaper.''

Angel Tax for startups have been dropped - "Section 56(2) (viib) shall not be applicable to startups registered under DPIIT. To mitigate genuine difficulties of startups, the Centre will set up cell led by member of CBDT for addressing problems of startups. Startups with an I-T issue can approach this panel," reported NDTV.

Her comments came as Moody’s Investors Service lowered India’s GDP growth forecast for the calendar year 2019 to 6.2 per cent from its previous estimate of 6.8 per cent.