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Section - 115BBG - Income from transfer of Carbon credits -

 

This is a new provision which deals with the assessment of Carbon credits. So far such credits are being treated as business income subject to tax at 30%. Divergent decisions have been given by the courts as to whether such credit is a revenue receipt or capital receipt. The provision seeks to clarify that where the total income of the assessee includes income by way of transfer of carbon credits, such income shall be taxable at the concessional rate of 10% on the gross amount of such income.

 

The amendment takes effect from 1st April 2018 relevant to assessment year 2018-19


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