Parliament passes Finance Bill 2021

The Parliament on March 23, 2021 passed the Finance Bill 2021, which seeks to bring to effect the financial proposals of the central government for financial year 2021-22.

The bill was first passed by the Lok Sabha then it was presented in the Rajya Sabha, which returned the bill without consideration. This effective means the bill was cleared by the Parliament. The bill's passage in the Parliament marks the completion of the budgetary process. 

The bill was cleared by the lower house of the Parliament with several amendments. Finance Minister Nirmala Sitharaman said that the bill has some changes in the proposals made in the union budget, which were made to boost ease of doing business and easing compliance burden.

The Minister added saying that there will be no change in the rate of income tax. Several opposition members had pointed out to the high prices of petrol and diesel during the debate on the bill and said petroleum products should be brought under the Goods and Services Tax (GST) Council.

The Minister said that the Centre is open to discussing the idea in the GST Council meeting. She said that if there is this concern about fuel tax then she will be glad to have it on the agenda during the next GST Council meeting. 

She also noted that Maharashtra has the highest tax on petrol and diesel. She added saying that states also tax fuel, not just Centre.

Other Details 

Finance Bill 2021 provides 10-year income-tax exemption to the National Bank for Financing Infrastructure and Development and 5-year tax exemption to private sector development finance institutions, which can be extended by another five years.

What is a Finance Bill?

The Finance Bill is a bill that relates to revenue or expenditure. Under Article 110 of the Indian Constitution, the Finance Bill is a part of the Union Budget and it encompasses all amendments required in various tax laws, in accordance with the tax proposals made in the Union Budget. 

Objective of Finance Bill

The Union Budget document proposes many tax changes for the upcoming financial year, which pertain to several existing laws. The Finance Bill seeks to insert amendments into all the concerned laws, leaving no need for bringing separate amendments for each of the Acts.