The government may cut tax deducted at source (TDS) on some essential commodities in a bid to mitigate the working capital crunch among the businesspeople in the context of the fallout of the coronavirus pandemic.
In his budget speech on Thursday, the finance minister proposed a cut in the existing rate of taxes deducted at source to 2.0 per cent from existing 5.0 per cent for the commodities.
The reduced rate would be applicable at the stage of local supply of essential commodities such as rice, atta, potato, garlic, onion etc. irrespective of the base price, he proposed.
He also proposed reducing TDS on the import of garlic and sugar to 2.0 per cent from 5.0 per cent.
For promoting the steel manufacturing industry, he proposed lowering the TDS rate of locally sourced M.S. scrap supply, irrespective of its base price, at 0.5 per cent from existing 5.0 per cent.
For the poultry sector, he proposed reducing the rate of TDS on the import of raw materials for poultry feed to 2.0 per cent from the existing rate of 5.0 per cent.
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