Finance Minister Nirmala Sitharaman introduced a Bill in the Lok Sabha on Wednesday to repeal the Provisional Collection of Taxes Act of 1931 and replace it with a new law, that would enable the government to give immediate effect to impositions or hikes in customs and excise duties on some goods without changing their tariff classifications.
“Assume, if in the Finance Bill, we bring in some kind of a tax proposal and it gets announced in the Budget. But the financial year by which it gets passed, if there are critical announcements made on customs or any other tax, it can lead to a lot of speculation,” the minister explained as the rationale for The Provisional Collection of Taxes Bill, 2023.
“Thus, by invoking this particular Act, we’re able to temporarily ensure, till the time the Finance Bill gets passed, that no speculative activities are happening because it’s part of the Bill,” she added.
