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After having fixed the rates of the goods and services tax (GST) on almost all commodities and services, the GST Council is trying to ensure that businesses pass on any tax reduction benefit to consumers when the new indirect tax regime comes into force on July 1. The most important issue related to the implementation of GST is whether the tax cuts will be passed on to consumers, Kerala finance minister Thomas Isaac said, adding that the council, which debated it prior to bringing in the anti-profiteering clause in the GST law, will discuss this matter further. “Union finance minister Arun Jaitley has assured that we may even have a special session (of the council) on this. It is noteworthy that no industry has come forward and said maximum retail prices will be reduced in line with tax reduction,” Isaac said in an interview. For the government, which insists that GST rates are not inflationary, it is essential for consumers to feel a cooling of prices to make the mo...

Experts say the Aid for Trade meeting in July may be a back door attempt by other nations to push e-commerce The World Trade Organisation has called a review meeting to promote connectivity through digital trade in developing countries, particularly least developed countries, amid strong opposition by India owing to apprehensions among experts that this may be a back door attempt to push e-commerce. The aim of the evaluation, which will take place, in July is development of e-commerce, infrastructure investment, services markets and investment in climate reforms.   Moreover, the global review of Aid for Trade is influential in galvanising support and directing strategies to help developing countries derive the maximum development benefit from trade.   “The strategy is to sell e-commerce to the African nations and get their critical support. If Africa comes in support, then the ecommerce deal is done. It will be pushed as being development frie...

The government has initiated the spadework for shifting the financial year to January, from April, to align it with the agriculture production cycle. Prime Minister Narendra Modi had backed the idea of January-December financial year last month while addressing chief ministers at the Governing Council of NITI Aayog.Preliminary work has started and it will gather momentum as year progresses, sources said.   The GST implementation from July 1 is also an indication in that direction, sources said, adding that it is being implemented beginning second half of the calender year.   The government had last year set-up a high-level committee to study the feasibility of shifting financial year to January 1 from the current practice of starting it from April 1.   The committee submitted its report in December, reasoning for the change and its effect on the different agricultural crop periods and its impact on businesses, taxation system and proc...

Tax on financial services transactions will rise from the current 15% to 18% as the goods and services tax (GST) kicks in on 1 July, making them marginally costlier. The new GST rates will apply to some banking transactions, mutual funds, insurance and stock market which were earlier taxed at 15% including Krishi Kalyan cess and  Swachh Bharat cess.   “GST applies to all services where this a supply for consideration. So, in banking transactions such as credit card payments, fund transfer, ATM transactions, processing fees on loans etc., where the banks are levying charges, increased tax rates would apply. This would have a slight inflationary impact,” said Saloni Roy, partner at Deloitte Haskins and Sells.   The Central Board of Excise and Customs (CBEC), the nodal body for indirect taxes, would issue notifications clarifying exemptions from the flat 18% tax rate. Interest on fixed deposits, bank account deposits etc., which do not attract a ...

Inflation will fall by 2% on implementation of the goods and services tax (GST) and will create buoyancy in the economy, Revenue Secretary Hasmukh Adhia has said. With the stage set for the biggest overhaul of India's tax system since Independence, the government will launch a massive awareness campaign to educate consumers about GST so that they are not fleeced by traders in the name of new tax.   In an interview to PTI, he said the all-powerful GST Council will meet next week to decide on tax rates of contentious items like gold, bidi and biscuits, just in time for its roll-out from July 1.   The Council over the two days last week assigned tax rates to more than 500 services and 1,200 goods by setting them in five broad rates of 5, 12, 18 and 28%.   Adhia and his team visited this pictures que hill station near Srinagar for a short break before heading back to Delhi.   The Economic Times  New Delhi, 22nd May 2017

Captains of Indian industry across sectors say they are ready for a July 1 rolloutof the “game changing” goods and services tax (GST). The GST would help the economy pick up pace, bring down the inflation rate, and boost the fortunes of corporate India,a nation wide poll of top chief executive officers (CEOs) revealed.   A survey of 34 CEOs conducted across India on Saturday, after the GST Council agreed on the rates for various goods and services in Srinagar last week, found that 88 per cent of corporate executives were prepared for a July 1 roll-out.   Ninety four per cent of the CEOs surveyed said the GST would have a positive impact on the economy and 62 per cent said that the tax would have a positive impact on inflation.   The GST rates have exempted several food products from the tax and keptamajority of essential items in the lower tax bracket of 5 per cent.   However, the anti-profiteering clause, which requires firms to p...