Bye, Bye Tax Deductions?

Looks like it's time to say bye bye deductions? This is a move to simplify tax policy and in the long term that's an excellent thing to do. In the short term some industries will feel the pain more than others. To do that sector-wise analysis Menaka Doshi of CNBC-TV18 is joined by Manish Shah of SKP.BYE, BYE DEDUCTIONS?Section 32 – Depreciation           1 Apr 2017: Rate of depreciation on assets to be reduced to 60%MOST IMPACTEDInfrastructure companies in water supply/treatment system  Industries manufacturing of air/water pollution control equipments Mining Silk industry Flour mill industry Iron & Steel industry Sugar industry Clean & Renewable energy Professionals    BYE, BYE DEDUCTIONS?Section 35AD – Deduction of capital expenditure for specified business1 Apr 2017: Weighted deduction of 150% of capital expenditure to be reduced to 100% MOST IMPACTEDCold chain facilityWarehouse for storage of agricultural produce Hospitals with at least 100 beds for patients Affordable Housing projects as notified Production of fertilisersBYE, BYE DEDUCTIONS?Section 35AC – Deduction for payment towards certain schemes / projects1 Apr 2017: 100% deduction for expenditure towards certain schemes / projects to be discontinuedMOST IMPACTEDNGOs running such schemes / projectsCompanies claiming backdoor deduction for CSR activities BYE, BYE DEDUCTIONS?Section 35 – Expenditure on Scientific Research             1 Apr 2017: Weighted deductions in the range of 125% - 200% to be reduced to 100% MOST IMPACTED           Universities, Colleges, Institutions (including IITs) Pharmaceutical companies expending heavily on in-house scientific researchOverall scientific research activitiesBYE, BYE DEDUCTIONS?Section 80-IA(4)(i) – Deduction for profits from infrastructure facility              1 Apr 2017: 100% deduction for profits from developing, operating and maintaining any specified infrastructure facility for 10 consecutive years to be discontinued MOST IMPACTEDInfrastructure companies involved in following:Road, toll road, bridge or rail systemHighway projectWater supply/treatment, irrigation, sanitation/sewerage/solid waste management  Port, airport, inland waterway, inland port…BYE, BYE DEDUCTIONS?Section 80–IAB – Deduction for profits from development of Specific Economic Zone (SEZ)1 Apr 2017: 100% deduction for profits from developing a SEZ  to be discontinuedMOST IMPACTEDCompanies involved in SEZ developmentSEZ sector as a wholeBYE, BYE DEDUCTIONS?Section 10AA – Deduction for profits from export of articles / things by SEZ units1 Apr 2017: Deduction for profits from exports by SEZ units to be discontinued MOST IMPACTEDSEZ sector as a wholeSoftware and IT enabled services Pharmaceutical companiesGem and JewelleryApparel BYE, BYE DEDUCTIONS?Section 80-IB(9)(ii)/(iv)/(v) – Deduction for profits from commercial production of mineral oils / natural gas1 Apr 2017: 100% deduction for profits from commercial production to be discontinued Most impactedNatural Gas industry players not starting commercial production before 1 April 2017BYE, BYE DEDUCTIONS?Section 35CCC – Deduction for expenditure on agricultural extension project&Section 35CCD – Deduction for expenditure towards notified skill development project1 Apr 2017: Weighted deduction of 150% available for expenditure on such projects to be reduced to 100%