Skip to main content

Firms might get more time to comply with 30% sourcing

By
The clause on mandatory sourcing from India, part of the single- brand retail policy, might be tweaked again. About three years after 100 per cent foreign direct investment ( FDI) was permitted in single- brand retail by the United Progressive Alliance ( UPA) government, there are indications that the sector might get more time to implement the contentious sourcing norm.
Currently, a company with more than 51 per cent FDI and seeking to operate under asingle- brand banner has to start complying with the 30 per cent sourcing norm within five years of the entity getting incorporated in the country.
The sector wants the sourcing clause to kick in five years after a company sets up its first store. It is learnt the government is considering relaxing the rulebook in a bid to implement “ease of doing business”.
If the clause is changed, major foreign brands such as Ikea, H& M, Adidas, Nike and even Apple would benefit. Ikea, the biggest FDI proposal so far in single- brand retail, is expected to set up its first store around 2017, while H& M made its debut on October 2. Adidas’ and Nike’s proposals are pending with the government. Apple, which currently has franchisee outlets, is keen on opening fullyowned stores.
So, a company like Ikea, which plans to invest about ? 10,000 crore in India, will have to source 30 per cent of its total sales from India by 2022 if the rule is changed. According to the current norm, it would have to start complying from 2018, as the firm was incorporated as a single- brand player in 2013.
Companies are looking to have good business in India before mandatory sourcing kicks in, it is learnt. Earlier, the UPA government had changed the sourcing rules under pressure from the sector.
The policy mandated 30 percent sourcing from Indian small and medium enterprises. Later, it was changed to mandatory sourcing from India, preferably from small and medium enterprises. Another change that may bein the offing is allowing foreign brands to set up singlebrand retail stores even if they have franchisee operations.
Business Standard, New Delhi, 12th Oct. 2015

Comments

Post a Comment

Popular posts from this blog

New income tax slab and rates for new tax regime FY 2023-24 (AY 2024-25) announced in Budget 2023

By
  Basic exemption limit has been hiked to Rs.3 lakh from Rs 2.5 currently under the new income tax regime in Budget 2023. Further, the income tax slabs in the new tax regime has been changed. According to the announcement, 5 income tax slabs will be there in FY 2023-24, from 6 income tax slabs currently. A rebate under Section 87A has been enhanced under the new tax regime; from the current income level of Rs.5 lakh to Rs.7 lakh. Thus, individuals opting for the new income tax regime and having an income up to Rs.7 lakh will not pay any taxes   The income tax slabs under the new income tax regime will now be as follows: Rs 0 to Rs 3 lakh - 0% tax rate Rs 3 lakh to 6 lakh - 5% Rs 6 lakh to 9 lakh - 10% Rs 9 lakh to Rs 12 lakh - 15% Rs 12 lakh to Rs 15 lakh - 20% Above Rs 15 lakh - 30%   The revised Income tax slabs under new tax regime for FY 2023-24 (AY 2024-25)   Income tax slabs under new tax regime Income tax rates under new tax regime O to Rs 3 lakh 0 Rs 3 lakh to Rs 6 lakh 5% Rs 6
Post a Comment
Read more

Jaitley plans to cut MSME tax rate to 25%

By
Income tax for companies with annual turnover up to ?50 crore has been reduced to 25% from 30% in order to make Micro, Small and Medium Enterprises (MSME) companies more viable and also to encourage firms to migrate to a company format. This move will benefit 96% or 6.67 lakh of the 6.94 lakh companies filing returns of lower taxation and make MSME sector more competitive as compared with large companies. However, bigger firms have shown their disappointment since the proposal for reducing tax rates was to make Indian firms competitive globally and it is the large firms that are competing globally. The Finance Minister foregone revenue estimate of Rs 7,200 crore per annum for this for this measure. Besides, the Finance Minister refrained from removing or reducing Minimum Alternate Tax (MAT), a popular demand from India Inc., but provided a higher period of 15 years for carry forward of future credit claims, instead of the existing 10-year period. “It is not practical to rem
1 comment
Read more

Don't forget to verify your income tax return in August: Here's the process

By
  An ITR return needs to be verified within 120 days of filing of tax return. Now that you have filed your income tax return, remember to verify it because your return filing process is not complete unless you do so. The CBDT has reduced the time limit of ITR verification to 30 days (from 120 days) from the date of return submission. The new rule is applicable for the returns filed online on or after 1st August 2022. E-verification is the most convenient and instant method for verifying your ITR. However, if you prefer not to e-verify, you have the option to verify it by sending a physical copy of the ITR-V. Taxpayers who filed returns by July 31, 2023 but forget to verify their tax returns, will get the following email from the tax department, as per ClearTax. If your ITR is not verified within 30 days of e-filing, it will be considered invalid, and may be liable to pay a Late Fee. Aadhaar OTP | EVC through bank account | EVC through Demat account | Sending duly signed ITR-V through s
Post a Comment
Read more