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Today, every state government, including all the Congress ones, is in favour of the Goods and Services Tax. You have every political party in Parliament which has said they will vote in favour. ARUN JAITLEY, Union finance minister The government remained hopeful on Thursday about the prospects of a nationwide Goods and Services Tax (GST), but maintained its unwillingness to specify the tax rate in the proposed law, arguing that it could distort the system. Once adopted, the GST can dramatically alter India’s indirect tax system by replacing a string of central and state levies such as excise, value added tax and octroi into a single unified levy and stitch together a common national market. “Today, every state government, including all Congress ones, is in favour of Goods and Services Tax (GST),” finance minister Arun Jaitley said at a media event. “You have every political party in Parliament which has said they will vote in favour,” he said. The Lok Sabha passed the landmar...

While the jewellery trade continues its stir for withdrawal of the one per cent excise duty announced in the Union Budget, the finance ministry does not indicate a compromise. "There is no question of a rollback," said a ministry official, on condition of anonymity, adding: "Our internal calculations show the government will get only about Rs 1,000 crore (a year) from the levy." The strike entered the 17th day on Thursday, also marked by a big rally at Delhi's Ramlila Maidan. "What are they scared of? We have given them all the assurance that they want. The taxman will not visit their premises," said the official. The ministry has instructed field formations against interfering with the business functions of manufacturers. Instructions to tax officials say no stock declaration will be required to be made to the excise tax authorities by jewellery makers. And, tax officials have been told not visit the premises of these assessees for routine purp...

The finance ministry is preparing a model Centre-State Investment Agreement (CSIA), for effective implementation of the Bilateral Investment Treaty it is set to sign with other countries. The draft could be presented to the Cabinet for approval in two or three months, Business Standard has learnt. Union Budget 2016-17, presented by Finance Minister Arun Jaitley on February 29, had proposed the CSIA, to be signed between the central and state governments. “This will ensure fulfilment of the obligations of state governments under these treaties. States which opt to sign these will be seen as more attractive destinations by foreign investors,” the annexure to the Budget speech had stated. “There can be instances where a problem with a foreign investor might be due to a particular state. Signing a CSIA will ensure states stick to the commitments as well,” said an official. Some of the features include an enterprise-based definition of investment, non-discriminatory treatment, prote...

The move comes after amendment was made under the Securities Contracts Regulation Act to include commodity derivatives as securities Markets regulator Securities and Exchange Board of India (Sebi) has allowed trading in commodity derivatives at stock exchanges operating in International Financial Services Centre ( IFSC). The move comes after amendment was made under the Securities Contracts Regulation Act to include commodity derivatives as securities. Sebi last year began regulating the commodity derivatives market as well. In a circular on Thursday, Sebi said, " Commodity derivatives shall be eligible as securities for trading and the stock exchanges operating in IFSC may permit dealing in commodity derivatives". Under the IFSC regime, any recognised domestic or foreign stock exchange can set up a subsidiary, in the financial services centre, provided they hold at least 51 per cent stake in the venture. Gujarat International Finance Tec- City ( GIFT City) is the fir...

Currently, it has to obtain a court warrant for search and seizure operations The Securities and Exchange Board of India ( Sebi) wants the power to conduct search and seizure operations without needing to first get a court warrant. It has begun informal discussion with the finance ministry to amend the law in this regard, said a person with knowledge of the matter. The markets regulator also wants a single special court in Mumbai for issue of warrants, instead of going to local courts of respective states or different jurisdictions. Sebi feels its operations in this regard are hampered by companies or individuals easily managing to get a stay on a search warrant issued by local courts. The regulator feels that the system needs reform, particularly on addressing the problem of illegal collective investment schemes. “An ordinary or local court is not equipped with ( the knowledge of) Sebi laws and procedures. This ( move) will give more room to the regulator,” said R S Loona, m...

Former finance minister and current President Pranab Mukherjee’s decision to amend the Income Tax Act with retrospective effect to negate a Supreme Court verdict was regrettable, said former Planning Commission Deputy Chairman Montek Singh Ahluwalia on Thursday. Business Standard, New Delhi, 18th March 2016

Non- banking financial companies ( NBFCs) are likely to see an uptick in bad loans as they migrate towards tighter non- performing asset (NPA) recognition norms, said Icra, a credit rating agency. "The gross NPA percentage of retail focused NBFCs ( excluding captive financiers) have stabilised at 4.3 per cent in December 2015 as compared to 4.1 per cent in June 2015. This however is higher than 3.4 per cent in March 2015 largely on account of migration of NBFCs to tighter NPA recognition norms, as the regulatory minimum NPA recognition moves to 150+ day by March 31, 2016. Based on Icras estimates, gross NPA percentage could increase to 4.2- 4.4 per cent by the end of the year as all NBFCs align their NPA reporting based on the 150 + day norm," said a report by the rating agency. According to current regulations, for an NBFC, an asset is classified as non- performing when it remains overdue for six months or more for loans and overdue for 12 months or more in case of lea...

The Reserve Bank of India on Thursday revised rules pertaining to revival of advances to small businesses and asked lenders to form districtlevel committees to resolve stressed loans to micro, small and medium enterprises ( MSMEs). “In order to enable faster resolution of stress in an MSME account, every bank shall form Committees for Stressed MSME,” RBI said in a notification. The rules have been revised for “ revival and rehabilitation of MSMEs having loan limits up to Rs.25 crore”. “Restructuring of loan accounts with exposure of above Rs.25 crore will continue to be governed by the extant guidelines on corporate debt restructuring ( CDR) or Joint Lenders’ Forum ( JLF) mechanism,” the notification said. The notification follows a May 2015 government decision to provide a simple and fast mechanism to address stress in accounts of MSMEs and also help in the promotion of such businesses, it said. A board- approved policy to operationalise the revised framework will have to ...