Tax sops for small traders on digital transactions: Govt

Currently, upon having a turnover of Rs 2 crore or less, profit is 8% of total turnover for taxation

The government announced tax incentives for small traders and businesses with a turnover of up to Rs 2 crore. The legislative amendments will be part of Finance Bill, 2017, Central Board of Direct Taxes (CBDT) said.

“…it has been decided to reduce the existing rate of deemed profit of 8 per cent under section 44AD of the Income-Tax Act to 6 per cent in respect of the amount of total turnover or gross receipts received through banking channel/digital means for the financial year 2016-17,” the CBDT release said.

Under the existing Section 44AD of the Income-Tax Act, 1961, in case of certain assesses (an individual, Hindu Undivided Family or a partnership firm other than LLP) carrying on any business having a turnover of Rs 2 crore or less, the profit is deemed to be 8 per cent of the total turnover for taxation, reported The Indian Express.