Contents: 

  • Economic Survey 2018-2019
  • Non-Tax Proposals
  • Tax Proposals

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2019 indian budget guide Ashok Maheshwary

The window for non-U.S., or foreign, investors to claim they are not subject to U.S. tax on gains stemming from the disposition of an interest in a U.S. partnership remains open. On June 11, 2019, the D.C. Court of Appeals ruled in favor of the taxpayer in Grecian Magnesite Mining Industrial & Shipping Co. SA v. Commissioner, upholding a July 13, 2017, decision by the Tax Court. The Court of Appeals decision could be significant for foreign investors in U.S. partnerships who took a position contrary to Revenue Ruling 91-32 prior to the enactment of the Tax Cuts and Jobs Act (TCJA).

Read more: Courts Confirm Foreign Partner Gain from Disposition of a U.S. Partnership Doesn’t Mean U.S. Tax...

On June 5, 2019, Governor Pritzker signed into law a $40 billion state spending plan following the conclusion of the state legislative session. One key state and local change resulting from the recent legislative session was the expansion of the manufacturing sales and use tax exemption. Intended to ameliorate the effects of the now repealed Illinois Manufacturer's Purchase Credit, the expansion builds on the current Illinois law which gives manufacturers a sales tax exemption for purchases of machinery and equipment used in manufacturing or assembling.

Read more: Illinois Manufacturing Sales & Use Tax Exemption Expanded

E-invoicing is a common B2B practice involving exchange of an invoice between a supplier and a buyer in an integrated electronic format. Businesses may have a number of reasons to use e-invoicing. Commercial considerations are likely to drive a company’s decision to adopt e-invoicing, as the administrative costs and processing times for issuing and processing electronic documents are typically far lower than those for traditional paper documents. The savings come not only from reducing printing and postage costs, but also from adopting integrated processes for all invoice-related tasks. Since the introduction of GST (Goods and Service Tax) in the Indian taxation system, GST officials have been diligent to work out a mechanism to stop tax evasion in India. There have been instances wherein tax fraudsters have been caught using fake invoices to evade taxes or claim additional ITC. And such occurrence was only possible in the absence of a proper mechanism to tackle such a situation on a nationwide level. From now onwards, businesses will be generating full electronic- tax invoice (e- invoice) recording entire sales value. If the country adopts the system, businesses will likely have to issue invoices, or bills, directly via the GST network, and the data will be available to the authorities right away.

Read more: GST e-invoicing module- Curbing tax evasion

In 2017 it was reported that the construction industry contributed £113bn to the UK economy. As one of the large drivers behind the UK economy, it is surprising how little is claimed back by construction businesses through Research and Development (“R&D”) tax relief.

Although Innovative activities are taking place every day in this industry, recent statistics show that less than 2.5% of all R&D tax credit claims are made from construction companies: in 2016-17, a total of 39,700 R&D tax relief claims were made with only 1,365 claims from the construction sector.

Read more: R&D Tax Relief in the Construction Industry