HIGHLIGHTS OF FINANCE ACT 2007

After the reply to debate on Finance Bill 2007 by Hon’able Finance Minister, the Lok Sabha passed the Finance Bill, 2007, including the amendments introduced by the Government. Major reliefs proposed by the Hon’ble Finance Minister while moving Government amendments are as under:

• Infrastructure incentive : The business of developing or operating and maintaining or developing, operating and maintaining any infrastructure facility has been included in the definition of clause (23FB) of section 10. 
• House Rent Perks : The new valuation of rent free or concessional rent accommodation owned and provided by the Non Governmental employer is reduced to 7.5% of salary (for cities having population of 10 lakhs and below), 10% of salary (for cities having population of more than 10 lakhs, but not more than 25 lakhs) and 15% of salary (for cities having population of more than 25 lakhs). The amount paid or recovered from employee for the rent of the accommodation will get reduced from this valuation. 
• ESOPs valuation date : In the case of ESOPs, the fringe benefit arising from ESOPs will now be valued on fair market value, on the date of vesting of option, as reduced by the amount paid by the employee for acquiring the specified security. The period of holding for the purpose of capital gain tax will be reckoned from the date of allotment or transfer of specified security.
• Investment in rural bonds of NABARD, as notified by the Central Government, is to be included in the list of permissible investment under section 80C.