Skip to main content

Exemption list to be pruned for GST

By
Excise relief for around 200 items may go, zero rate being debated
Tea, coffee, biscuits and some medicines, currently exempted from excise duty, may come under the proposed goods and services tax ( GST) as the finance ministry and empowered committee of state finance ministers draw up a common list of exempted items.
The Centre’s excise duty exemption list of around 300 items will be reduced to the states’ value- added tax ( VAT) list of close to 90.
“We are finalising the exemption list. Excise exemptions will be pruned to around 90 items,” said a government official. “ The idea is to keep exemptions to a minimum.” States exempt unprocessed goods and those consumed by the poor like fruit, vegetables, salt, grain and coarse fabric. The Centre provides excise exemption to processed food and pharmaceuticals and a concessional rate to fruit- based items. Common items between Centre and states include bread, eggs, milk, vegetables, cereals, books and salt, which will continue to be exempted.
Items of importance in certain states could also be exempted. “Coconut oil in Kerala and sattu in Bihar are of local importance and state- level exemption could be provided,” the official said.
The negative list of services, exempted from the levy, will be reduced to include only essential services like health and education. “We will have a very small number of essential services out of the GST net,” the official added. The negative list of services has 18 heads, which include health care, education, goods transport agency and non- air conditioned restaurants, among others.
Chief Economic Advisor Arvind Subramanian, in his recommendation on a revenue- neutral rate for the GST, has argued eliminating the exemptions on health and education will make tax policy more consistent with social objectives. He has also recommended bringing electricity and petroleum within the scope of the GST.
“The government has been pruning the excise exemption list for quite some time. From 542 items in 2011, it has come down 300 items,” said Rajeev Dimri, leader of indirect tax at BMR & Associates LLP.
“It will be difficult to have local items in certain states on the exemption list. The technology system has been designed in a way that there cannot be different lists for different states,” pointed out Satya Poddar, senior tax advisor, EY.
Business Standard, New Delhi, 8th Dec. 2015 

Comments

Post a Comment

Popular posts from this blog

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...
Post a Comment
Read more

SFBs should be vigilant, proactive to mitigate risks: RBI deputy guv

By
  The Reserve Bank of India’s Deputy Governor Swaminathan J on Friday instructed the directors of small finance banks (SFBs) to be vigilant and proactive in identifying emerging risks in the sector.Speaking at a conference for directors on the boards of SFBs, Swaminathan highlighted the role of governance in guiding SFBs towards sustainable growth with stability. He also emphasised the importance of sustainable business models.Additionally, he highlighted the need for strengthening cybersecurity to protect the entities against digital threats and urged for a stronger focus on financial inclusion, customer service, and grievance redressal to ensure a broader reach of banking services.Executive Directors S C Murmu, Rohit Jain, and R L K Rao, along with other senior officials representing the Supervision, Regulation, and Enforcement Departments of the RBI, also participated in the conference.   -  Business Standard  30 th  September, 2024
Post a Comment
Read more

Brigade Hotel Ventures files draft papers with Sebi for Rs 900 crore IPO

By
  Brigade Hotel Ventures Ltd, owner and developer of hotels in South India, has filed draft papers with capital markets regulator Sebi to raise Rs 900 crore through an initial public offering (IPO).The proposed IPO is entirely a fresh issue of equity shares with no Offer-for-Sale (OFS) component, according to the draft red herring prospectus (DRHP).Proceeds from the issue to the tune of Rs 481 crore will go towards payment of debt, Rs 412 crore will be allocated to the company and Rs 69 crore to its material subsidiary, SRP Prosperita Hotel Ventures Ltd.Additionally, Rs 107.52 crore will be used to purchase an undivided share of land from the Promoter, BEL, and the remaining funds will support acquisitions, other strategic initiatives, and general corporate purposes.The company may raise up to Rs 180 crore through a Pre-IPO Placement.   If the placement is undertaken, the issue size will be reduced.Brigade Hotel Ventures Ltd is a wholly-owned subsidiary of Brigade Enterprises ...
Post a Comment
Read more