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The first week of June saw a 13 day reduction in the drug inventory at the stockist level, raising fears of possible shortages with the implementation of the goods and services tax (GST) on July 1. As of June 7, stockists were carrying 27 days of inventory, while at the end of May they had 40 days´ stocks. “Compared to May 31, there is a reduction of almost 13 days´ inventory. An average of 27 days´ inventory is more than adequate to service the market and there is not even a remote likelihood of a shortage of medicines at the retail level,” said Ameesh Masurekar, director of AIOCD-AWACS, the market research wing of the All India Organisation of Chemists and Druggists. The government has set July 1 as the deadline for roll-out of the GST. With the exception of life saving drugs and a few other products, medicines have been included in 12 per cent tax rate, which is higher than the current tax level. There is anxiety within trade channels on margins and this is leading to lower off ...

The Union government is seeking industry feedback on how to readjust the duty drawbacks in the new goods and services tax (GST) regime. “It will change. Sought views of the industry as state levies are subsumed in GST,“ Union textiles additional secretary Subrata Gupta said when asked whether the ROSL (rebate of state levies on export of garments) scheme will continue in the present form during GST regime. He was in the city in a CII supported road show -Textiles India 2017. ROSL, a remission scheme to offset state levies is an import additional duty draw back scheme announced by the textile ministry for exporters in late 2016. “We are surviving on drawbacks. ROSL is very important benefit with great positive impact on exports. Monthly exports of apparel in April, 2017 grew by almost 32% to $174 billion over the same month last year. The benefit of ROSL is to the tune of 4% to our cost,“ chairman of Apparel Export Promotion Council, Anil Buchasia said. Exporters remained wary about...

The government has ruled out centralised registration for banks under the goods and services tax (GST) and has mandated separate registration for each state they operate in.Banks have been demanding a single centralised registration system, like at present, arguing that multiple registrations would create procedural and compliance problems. “They have no choice. They have some issues relating to registration, which will be resolved in due course,“ said a top finance ministry official. At a meeting of finance ministry with the heads of public sector banks here on Monday, a separate session was held on issues related to GST. “We have eased some of their problems.GST will be rolled out as per schedule from July 1,“ the official said. Currently, banks as well as non-banking finance companies (NBFCs) with pan-India operations can discharge their service tax compliances through a single 'centralised' registration. But under GST, they would need to obtain a separate registration f...

CBEC sends field officers action points including helping businesses migrate to new regime With the roll-out of the goods and services tax (GST) about two weeks away, the government machinery is stepping up preparatory efforts. The Central Board of Excise and Customs (CBEC) has written to field officials to be GST ready and ensure a smooth transition to the game-changing tax reform when it's rolled out on July 1. In a communication to field formations sent on June 12, CBEC chairman Vanaja Sarna has listed a number of action points that include assisting businesses to migrate to the new regime.The note follows a detailed stocktaking meeting on GST preparedness by Prime Minister Narendra Modi last week. “GSK (GST Suvidha Kendras) should be a one-stop solution for taxpayers seeking advice information on GST, including assistance in real-time registration, payment,“ Sarna said in the letter. As many as 25 states have passed SGST (state GST) legislation and some more are expected to...

The finance ministry on Monday said subscribers of the Atal Pension Yojna (APY) will have to link their Aadhaar to their ac counts for availing up to Rs 1,000 government's co-contribution. Any individual who is eligible to receive benefits under the APY will have to furnish proof of possession of Aadhaar number or undergo enrolment under Aadhaar authentication, the ministry said in a statement. PFRDA has identified nearly 12.35 lakh subscribers who are eligible for government co-contribution for an amount up to Rs 1,000 for the financial year 2016-17. The Economic Times New Delhi, 13th June 2017

Industry anticipates fares may rise to offset higher cost of ops under new levy The Goods and Services Tax (GST) may not provide a tailwind to India's aviation industry, which anticipates fares could increase to help offset the rising cost of operations under the new levy. “Under GST, airlines will be taxed for importing spares for their use and on aircraft lease rentals, and these are not being taxed in the current regime. Any new tax on the aviation industry, which operates under thin margins, may drive fares higher,“ said a senior airline executive, who did not want to be identified. Carriers are concerned that not only the potential increase in tax incidence, but also likely reductions in input tax credits on revenues earned through economy class seats could reduce operating flexibility. “Regarding input tax credits (ITC), the lower rate of 5% on economy class travel comes with restrictions, whereby ITCs can be claimed on input services. ITCs are not claimable on the purcha...

Unique Identification Authority of India (UIDAI) has advised all its enrolment agencies to accord priority to taxpayers who want to update their mobile numbers in the system for the goods and services tax (GST) regime.The move comes weeks before the roll-out of the GST from July 1. UIDAI Chief Executive Officer Ajay Bhushan Pandey said the mobile update will necessitate physical presence of the tax payer. Business Standard New Delhi, 13th June 2017

Lower price hikes, coupled with market share gains from unorganised entities, would be key positives The Goods and Services Tax (GST) Council’s decision to lower rates on 66 items brought cheer to a host of companies in the jewellery, cinema and pharmaceutical sectors. Take jewellery companies. While a lower-than-expected rate of three per cent on gold was a positive, the earlier decision was to have 18 per cent (from two three per cent) on making jewellery from plain gold. This would have meant price increases by jewellery makers, which could have impacted their volume. Importantly, this would have further widened the price differential between jewellery sold by organised entities like Titan, PC Jeweller and TBZ, and their counterparts in the unorganised sector. With this rate now down to five per cent, the organised sector entities can take calibrated price hikes and still gain market share from the others, who will see elevated compliance-related costs with GST implementation. M...

Days ahead of the July 1 goods and services tax (GST) rollout, rumours of a postponement of the uniform indirect tax have started doing the rounds.However, the government has denied any such move at the moment.Government officials as well as those with GST Network (GSTN) were inundated by phone calls from the industry and traders, all wanting to confirm the speculation."Since morning I have received at least 10 calls asking if the GST is being deferred.There is absolutely no such thought process in the government as of today.July 1 is the rollout date" said a government official involved with the GST´s implementation.Apparently, it all started with a Whats App forward that suggested an internal study of the government had found preparations for the GST rollout were still incomplete.Representatives of a few GST Suvidha Providers were seen calling up officials to know the authenticity of these rumours. Suvidha Providers are the ones which help businesses comply with the GST...

Jaitley also says states offering farm loan waivers will have to generate funds from their own resources Union Finance Minister Arun Jaitley said on Monday that the Reserve Bank of India (RBI) was at “a fairly advanced stage” of preparing a list of borrowers from whom non-performing assets (NPAs) of public sector banks could be recovered under the Insolvency and Bankruptcy Code. The move, he said, would help be leaguered public sector banks (PSBs) recover part of their NPAs, estimated at over Rs 6 lakh crore. Jaitley´s remarks came after he,along with RBI and finance ministry officials, held a meeting with the heads of PSBs and took stock of problems affecting the lenders. “Under the new Ordinance issued, the RBI is atafairly advanced stage of preparing a list of those debtors where a resolution is required through the Insolvency and Bankruptcy Code (IBC) process.You will be shortly hearing about it,” he said. The Centre issued an Ordinance last month by amending the Banking Regula...