Skip to main content

Mixed results so far on Budget announcements

By
With five months of financial year 2015- 16 left, the time is right to assess the progress of announcements made by Finance Minister Arun Jaitley in the Budget for 2015- 16.
The government cleared confusions relating to tax matters.
However, most of these relate to Jaitleys maiden Budget for 2014- 15.
The finance ministry also did away with minimum alternate tax ( MAT), not only on foreign portfolio investors (FPIs), but also on businesses without permanent establishment in India. However, this was not a Budget announcement, but a fallout of the proposal that did away with MAT on FPIs prospectively.
The most important of these measures was to be the introduction of the Goods and Services Tax ( GST) from the next financial year. The Constitution Amendment Bill in this regard is stuck in the Rajya Sabha. The Congress, All India Anna Dravida Munnetra Kazhagam and left parties are opposed to it in the present form, despite a Rajya Sabha select panel altering the contentious one per cent tax on inter- state sale of goods. If the Bill is not passed in the winter session of Parliament, it would be difficult for the government to introduce it from April 1, 2016, since state legislatures will also have to pass the bills.
The government has already reached an agreement with the Reserve Bank of India on the monetary policy committee (MPC), which will fix policy rate. Though RBI governor Raghuram Rajan is not likely to be given a veto, the central bank will have a majority in the committee, unlike previous proposals.
The finance ministry has described the Bankruptcy Law as the next big reform. A committee, headed by T K Viswanathan, is expected to submit its report on the issue to the government shortly. After this the draft Bill will go to the Cabinet and finally Parliament. The Law is expected to make important changes to processes for liquidation and revival of companies.
On Public Debt Management Agency ( PDMA), the plan is to constitute a shell PDMA first to set up infrastructure required to issue government securities. This will require Parliament’s assent as well.
Business Standard, New Delhi, 2nd Nov. 2015

Comments

Post a Comment

Popular posts from this blog

RBI deputy governor cautions fintech platform lenders on privacy concerns during loan recovery

By
  India's digital lending infrastructure has made the loan sanctioning system online. Yet, loan recovery still needs a “feet on the street” approach, Swaminathan J, deputy governor of the Reserve Bank of India, said at a media event on Tuesday, September 2, according to news agency ANI.According to the ANI report, the deputy governor flagged that fintech operators in the digital lending segment are giving out loans to customers with poor credit profiles and later using aggressive recovery tactics.“While loan sanctioning and disbursement have become increasingly digital, effective collection and recovery still require a 'feet on the street' and empathetic approach. Many fintech platforms operate on a business model that involves extending small-value loans to customers often with poor credit profiles,” Swaminathan J said.   Fintech platforms' business models The central bank deputy governor highlighted that many fintech platforms' business models involve providing sm
Post a Comment
Read more

Credit card spending growth declines on RBI gaze, stress build-up

By
  Credit card spends have further slowed down to 16.6 per cent in the current financial year (FY25), following the Reserve Bank of India’s tightening of unsecured lending norms and rising delinquencies, and increased stress in the portfolio.Typically, during the festival season (September–December), credit card spends peak as several credit card-issuing banks offer discounts and cashbacks on e-commerce and other platforms. This is a reversal of trend in the past three financial years stretching to FY21 due to RBI’s restrictions.In the previous financial year (FY24), credit card spends rose by 27.8 per cent, but were low compared to FY23 which surged by 47.5 per cent. In FY22, the spending increased 54.1 per cent, according to data compiled by Macquarie Research.ICICI Bank recorded 4.4 per cent gross credit losses in its FY24 credit card portfolio as against 3.2 per cent year-on-year. SBI Cards’ credit losses in the segment stood at 7.4 per cent in FY24 and 6.2 per cent in FY23, the rep
Post a Comment
Read more

India can't rely on wealthy to drive growth: Ex-RBI Dy Guv Viral Acharya

By
  India can’t rely on wealthy individuals to drive growth and expect the overall economy to improve, Viral Acharya, former deputy governor of the Reserve Bank of India (RBI) said on Monday.Acharya, who is the C V Starr Professor of Economics in the Department of Finance at New York University’s Stern School of Business (NYU-Stern), said after the Covid-19 pandemic, rural consumption and investments have weakened.We can’t be pumping our growth through the rich and expect that the economy as a whole will do better,” he said while speaking at an event organised by Elara Capital here.f there has to be a trickle-down, it should have actually happened by now,” Acharya said, adding that when the rich keep getting wealthier and wealthier, they have a savings problem.   “The bank account keeps getting bigger, hence they look for financial assets to invest in. India is closed, so our money can't go outside India that easily. So, it has to chase the limited financial assets in the country and
Post a Comment
Read more