Circular explaining the provisions of the Finance Act, 2023
Circular explaining the provisions of the Finance Act, 2023 – Circular No. 1/2024
- Introduction
1.1 The Finance Act, 2023 (hereafter referred to as ‘the FA 2023’) as passed by the Parliament, received the assent of the President on 31st March, 2023 and has been enacted as Act No. 8 of 2023.
1.2 This circular explains substance of the provisions of the FA 2023 relating to direct taxes. - Changes made by the FA 2023
2.1 The FA 2023 has,-
(i) specified the existing rates of income-tax for the assessment year 2023-24 and the rates of income-tax on the basis of which tax has to be deducted at source and advance tax has to be paid during financial year 2023-24; and
(ii) amended certain sections of the Income-tax Act, 1961 (‘the Act’). - Rate structure
3.1 Rates of income-tax in respect of incomes liable to tax for the assessment year 2023-24.
3.1.1 Part I of First Schedule to the FA 2023 specifies the rates of income-tax in respect of incomes of all categories of assessees liable to tax for the assessment year 2023-24. These rates are the same as those laid down in Part III of the First Schedule to the Finance Act, 2022 for the purposes of computation of “advance tax”, deduction of tax at source from “Salaries” and charging of tax payable in certain cases during the financial year 2022-23. Main features of the rates specified in the said Part I are as follows:
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