A Finance Act is the fiscal legislation enacted by the

Indian Parliament The Parliament of India (IAST: ) is the supreme legislative body of the Republic of India. It is a bicameral legislature composed of the president of India and two houses: the Rajya Sabha (Council of States) and the Lok Sabha (House of t ...

to give effect to the financial proposals of the

Central Government A central government is the government that is a controlling power over a unitary state. Another distinct but sovereign political entity is a federal government, which may have distinct powers at various levels of government, authorized or del ...

. It is enacted once a year and contains provisions relating to income taxes, customs, excise, Central and Integrated GST and other cess, exemptions, and reliefs. It may also contain provisions to amend other acts as the Government to effect its fiscal policy. The bill is usually termed the budget and it is introduced in Parliament by the

Finance Minister A finance minister is an executive or cabinet position in charge of one or more of government finances, economic policy and financial regulation. A finance minister's portfolio has a large variety of names around the world, such as "treasury", ...

Important elements of Finance Act

All the elements included in the Finance Act associated with a particular

Financial Year A fiscal year (or financial year, or sometimes budget year) is used in government accounting, which varies between countries, and for budget purposes. It is also used for financial reporting by businesses and other organizations. Laws in many ...

are of course important. Even so, there are particular elements that take precedence over the others. The most important element is the rules laid down in the Act with respect to Income Tax Rates. Every year, the Act lays down in detail all the associated provisions related to Income Tax in the country. Since this applies to a large number of taxpayers, it is considered one of the most important elements. The Finance Act is responsible for laying down the tax slabs that applies to taxpayers. The Act includes various details related to: * Income through Salary * Agricultural Income * Tax slabs for

Senior Citizens Old age refers to ages nearing or surpassing the life expectancy of human beings, and is thus the end of the human life cycle. Terms and euphemisms for people at this age include old people, the elderly (worldwide usage), OAPs (British usage ...

* Tax slabs for Very Senior Citizens * Income Tax Surcharges * Taxes chargeable to companies * Advance tax These are a few important elements included and elaborated upon in detail in the

Finance Act A Finance Act is the headline fiscal (budgetary) legislation enacted by the UK Parliament, containing multiple provisions as to taxes, duties, exemptions and reliefs at least once per year, and in particular setting out the principal tax rates f ...

for a particular year.

Direct Taxes

The Finance Act for a particular financial year also includes the amendments that have been made with respect to Direct Taxes. The Amendments made under various sections are noted down in this section of the Finance Act and each amendment of every section is noted down separately. Also included in the Finance Act is the details of the insertion of new sections, if any.

The Schedule

The Schedule in any Finance Act is a systematic depiction of all the rules and regulations laid down by the Act for that Financial Year. The Schedule gives details on * Rates of

Income Tax An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them (commonly called taxable income). Income tax generally is computed as the product of a tax rate times the taxable income. Ta ...

* Surcharge on Income Tax * Rates for Deduction of Tax at Source * Details of Advance Tax * Details for computation of Net Agricultural Income among other details.

Acts

The Taxation Laws (Second Amendment) Act, 2016 inserted the new Chapter IX A, as "Pradhan Mantri Garib Kalyan Yojana, 2016" in The Finance Act, 2016.

References

{{Taxation in India Indian tax legislation Union budgets of India