CA Online

Two of the government’s high-profile schemes launched with the aim to reduce demand for physical gold and rein in the current account deficit have so far yielded modest results, signaling lack of clarity and volatile prices of the yellow metal. According to traders and experts, while the schemes fare better than existing options for gold, wider involvement of jewelers and a clear communication on the tax structure could improve response as days go by. T he Gold Monetisation Scheme (GMS) launched by Prime Minister Narendra Modi two weeks ago, to monetise part of the estimated 20,000 tonnes of gold lying idle with households, has been able to bring in only around 400 grams of gold. The gold bond scheme, the first tranche of which closed on Friday, has raised about Rs.150 crore, according to people familiar with the development. Through sovereign gold bonds, an investor gets an annual interest of 2.75%, apart from the benefits of the market price of gold on maturity. “Currently

Chairman to be selected at next meet The proposed national goods and services tax ( GST) continues to face obstacles, as seen on Friday, barely a week before Parliament is to begin its winter session where the constitutional amendment to enable it is to come up. At a meeting of the empowered committee of state finance ministers ( EC) on the tax, there were clear divisions on the threshold above which a GST should apply. A committee chaired by the governments chief economic advisor, Arvind Subramanian, is to soon give its recommendation on the GST rate. The finance ministry has said a high rate would be counter- productive. At the EC meeting, many felt the rate could be fixed at 18 per cent. Some such as Punjab, Chhattisgarh and Delhi were agreeable to the Union government proposal for the threshold at Rs.25 lakh annual turnover of a company; others wanted Rs.10 lakh. " There was divided opinion," Delhis deputy chief minister and finance minister, Manish Sisodia, told

Draft schedule released by CBDT says sunset clause may not be extended The finance ministry has proposed a road map on making tax rates more competitive and proposed phase- out of most of the exemptions from the 2017- 18 financial year. This is in tune with this year’s Budget announcement that the corporate tax rates would be reduced to 25 per cent over the next four years from 30 per cent at present but would be accompanied by a corresponding phase- out of exemptions and deductions. The draft schedule for phasing out these exemptions was put in the public domain by the Central Board of Direct Taxes on Friday. It has invited comments within the next 15 days. The road map says profit- linked, investmentlinked and area- based deductions would be done away with for corporate and non- corporate tax payers. Provisions with a sunset date would not be extended or advanced. For incentives with no terminal date, a sunset date of March 31, 2017, would be provided for commencement of th