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Showing posts from September 5, 2016

Treading cautiously on GST roll-out

An analysis carried in this newspaper about the states that have already ratified the Constitution Amendment Bill on Goods and Services Tax (GST) provides revealing insights into the political possibilities that can arise out of the proposed indirect taxes regime. It also brings out with great clarity the nature of the tough political resistance the new law and its enforcement could face. Of the 18 states that have endorsed the GST Bill, 10 are ruled by the Bharatiya Janata Party (BJP) and its allies. This is not a surprise. After all, the GST proposal in its current form has been spearheaded by the BJP-led government at the Centre. What, however, is a surprise is the fact that so far the expected ratification has not come from quite a few of the states, ruled either by aBJP-led alliance or those parties that had supported the Constitution Amendment Bill in Parliament. For instance, the Trinamool Congress-led West Bengal had initially planned to ratify the GST Bill at a special Assembly…

We want capping of GST rate in law

More than half the states have already passed the Constitution amendment Bill on GST. Do you think the GST could now be rolled out on April 1, 2017, as targeted by the government? Since the Bill has been passed and ratified by the required number of states, it is for the government to take it forward. It needs to ensure there is strong and broad consensus on the nature of CGST (central GST) and IGST (integrated GST) Bills. The central government also needs to work with the states on an acceptable GST rate. The rate has to be capped since it is going to subsume all present duties and taxes of the Centre and states. The government should keep it at a globally acceptable threshold. Which is what?
Anything below 20 per cent. Above 20 per cent would be meaningless. And, don’t forget that they (government) have not been able to persuade some states to allow taxing of petroleum goods. These are there in the Bill but zero rated. Alcohol has been completely kept out; electricity is out. If you c…

Townhall meet to explain GST

In a first of its kind townhall meet on(GST)goods and services tax Bill,Revenue Secretary Has mukhAdhia and tax officials will address traders and industry on September 17to clear doubts and create awareness on the landmark indirect tax regime set to kick in from April 1 next year. The meeting is part of an out reach programme planned by the Revenue Department in the Finance Ministry. Business Standrard New Delhi,05th September 2016

New date for Budget only after Acharya panel inputs

The National Democratic Alliance government at the Centre wants to change the date of the Union Budget,in sync with the suggestions of an expert panel examining the feasibility of a new financial yearfor the country. At present,the Budget is usually presented on the last day of February.A committee headed by for merchief economic advisor Shankar Acharya was setup to examine whether the April-to-March financial year could be replaced with anewone. With the possibility of an earlier Budget date,the Budget season has already begun this year.Sources said senior officer shavestarted to brain stormonthethemes of the annual exercise. Specifics are yet tobe worked out,but the broad theme would be“development”,according to a highly placed source.The focus will be on achieving eight percent yearly growth and government expenditure with an eye on that goal,he said. Several state elections,including that of Uttar Pradesh,are scheduled nextyear. Prime Minister Narendra Modi,it is learnt, has discussed …

Start maintaining a personal balance sheet

After making the Permanent Account Number (PAN) mandatory for high-value transactions, the government is now considering banning all-cash transactions of more than ~3 lakh. The Supreme Court-appointed Special Investigations Team (SIT) on black money has recommended this to the Centre. It has also proposed that holding more than ~15 lakh in cash be made illegal for individuals and for companies. “Domestic black money is a bigger menace than the illegal cash stash abroad. This will allow the tax department to track all high-value transactions and reduce cash in the economy,” says Neha Malhotra, executive director, Nangia & Co. Rise in income-tax (I-T) notices? Once these guidelines are in place, the I-T department will get a better handle on your financial transactions. And, any unexplained highvalue transaction could lead to notices seeking explanation about the source of funds. At present, some transactions where individuals pay cash of more than Rs.3 lakh include property purchases, …