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Showing posts from February 22, 2017

RBI for December Deadline to Recast Top 50 Bad Loans

Acharya proposes 2 AMCs and 2 rating agencies for valuation of stressed assets The Reserve Bank of India is proposing its toughest measures yet to recover loans from defaulters by prescribing December deadline for the loan restructuring of top 50 defaulters in a way that the assets turn viable and also in an environment where vigilance departments do not stifle the right economic outcome.
Picking up from where former governor Raghuram Rajan left, deputy governor Viral Acharya proposed setting up two asset management companies, one private and the other quasi with government stakeholding, and two rating agencies backing for valuation of stressed assets. The rate of bad loans has come to such an alarming level that banks should be shown some `tough love' by barring those non-performers from taking deposits and lending.In some cases, merger of banks should also be considered to reduce dependence on government capital. “This situation should be a cause for concern to all of us,“ Deputy Go…

Govt May Roll Back 10% LTCG Tax Plan on Esops

Sachin Dave & Reena Zachariah Govt proposed in budget that anyone who bought shares in unlisted cos before Oct 1, 2004, and not paid STT will have to pay LTCG tax The government may be looking to roll back or tweak a budget announcement, imposing long-term capital gains (LTCG) tax on holders of ESOPs and private equity investors, people close to the development said. In the budget, the government had introduced a provision whereby anyone who acquired shares in unlisted companies before October 1, 2004, and had not paid securities transaction tax (STT) will be liable to pay 10% LTCG tax.

“Several representations were made by stake holders, and the government may look into this.While the demand is for a complete rollback, the government may come out with a clarification so that genuine investors are exempted,“ a person close to the development said.

The government had brought the provision to plug a loophole being used to evade taxes.

“Several representations were made by the industry to …

No amnesty for bank deposits linked to money laundering: CBDT

Any bank account suspected to have been ´misused´ for money laundering or shell company operations won´t be exempted from probe under ´Operation Clean Money´ despite having low deposits, the CBDT said on Tuesday. The Central Board of Direct Taxes (CBDT), the policymaking body of the department, issued specific guidelines to ascertain ifaparticular cash deposit is genuine or not and withaview to "maintain consistent approach during verification" under ´Operation Clean Money´ where 1.8 million people were contacted by the taxman. "In case, there is information or apprehension/ suspicion thataparticular bank account(s) has been misused for money laundering, tax evasion, entry operations in shell companies, the monetary cutoff or cash balance based cut off prescribed in clauses above requiring noverification, shall not be applicable," it said.

The instructions earlier made it clear that in case of an individual (other than minors) not having any business income, "no …

Control over territorial waters, inter state transfers key to GST Bills reaching Parliament

Settling two contentious issues —definition of territorial waters and administration of interstate transfers —appears key to the passage of the Goods and Services Tax (GST) Bill in the second half of the Budget session, beginning in the second week of March. Issues over compensation law were cleared by the GST Council last week. It will take up the remaining Bills —Central GST, State GST and Integrated IGST —on March 4 and 5. Resolving these issues would make way for the July 1 rollout of the uniform indirect tax legislation.

The Council has sought the views ofalaw committee on the matter.

"All GST laws are being vetted.

There are areas of concern.

Constitutional conflicts that will have to be carefully negotiated," saidasenior government official.

On the issue of territorial waters, the Centre has agreed to give states the power to collect taxes on economic activities within 12 nautical miles.

But it did not agree to treat these areas as part of the relevant state´s territory.

The s…