tax

About Angel Tax

• Angel Tax is a tax levied on the capital raised via the issue of shares by unlisted companies if the share price 

of issued shares is seen in excess of the fair market value of the company.

• The excess funds raised at prices above fair value is treated as income, on which tax is levied.                                                2.About Gift Tax

• The Parliament of India introduced the Gift Tax Act in 1958, and gift tax is essentially the tax charged on the 

receipt of gifts.

• The Income Tax Act states that gift whose value exceeds Rs.50,000 are subject to gift tax in the hands of the 

recipient.

• The gift tax is also applicable on certain transfers that are not considered a gift.

• The transfer of existing movable or immovable property in money or money's worth qualifies for gift tax.

• The gift is exempted from tax if it was given by a relative.

• Gifts can be exempted from tax in various situations, including wedding gifts, inheritance gifts, and cash or 

rewards received by local authorities or educational institutions based on merit.

• Rate: It is levied at a rate of 30.9% on net investments in excess of the fair market value.

• Objective: To deter the generation and use of unaccounted money through subscription of shares of a closely 

held company, at a value which is higher than fair market value.                                  3.Off-Budget Borrowings

The Centre for Social and Economic Progress (CSEP) has recently published a comprehensive report shedding light

on 'Off-Budget Borrowings (OBB)' by Indian Governments.

• Definition of OBB: Off-budget borrowings by a government refer to loans taken by its entities, special

purpose vehicles, that are expected to be repaid by the government's own budget rather than the borrowing

entity's cash flows or income.