CA Online

The government has notified the implementation of the central goods and services tax (C-GST) from July 1, making it clear that the roll out of the new indirect tax regime is on course. “I don’t see much of a problem. Small issues will always arise whenever you make a change of any kind. But I’m sure the system is fully geared up and the system will eventually smoothen itself out,” finance minister Arun Jaitley said after a Cabinet meeting on Wednesday. Asked about West Bengal chief minister Mamata Banerjee’s statement against the implementation of GST from July 1, Jaitley said the date had been decided by consensus by the GST Council, which meant by the Centre as well as all the states. “It [the date] has not been decided by the Centre. And more importantly, there is a constitutional mandate and that mandate is that on 16th of September, you will lose the right to collect existing taxes. So the alternate system has to come into pl ..“We have spent so much time in building consensus...

Intangibles such as trademarks and goodwill will face a goods and services tax (GST) of 18% according to the final rate schedule notified by the government on Wednesday. The proposed tax is to be rolled out from July 1. Anything not mentioned in the harmonised system nomenclature will face 18% tax says the schedule notified by the government. These are called residual entries in technical parlance and the same principle is already in place for GST on services. Since intangibles such as trademarks and goodwill do not find a mention in the schedule they would fall in the category of residual entry, according to tax experts. The detailed chapter-wise rate schedule has been notified in line with the impending rollout of the new tax from July 1. The GST Council, the apex body comprising the Centre and the states set up to decide on GST issues, has finalised a four-tier tax structure of 5% (2.5+2.5), 12% (6+6), 18% ( 9+9) and 28% (14+14) for GST (Central GST+ State GST), but the highest ...

The Securities and Exchange Board of India (Sebi) has proposed to ease the compliance burden on foreign portfolio investors (FPI) by reducing documentation and doing away with approvals for merger of schemes. In a consultation paper, Sebi has proposed to exempt FPIs, which have multiple investment managers, from taking its approval for free of cost transfers. Designated depository participants (DPPs) would clear such applications. Foreign funds will also not need approval to change their DPPs, which act as brokers and first-level regulators for FPIs. Further, Sebi proposes to do away with a majority of the conditions prescribed under the ‘fit & proper’ criteria for category-I and II investors. It says as these are well-regulated in their home jurisdiction, there is no need for additional paperwork. “Category I and II FPIs are essentially government and regulated entities,”explains the discussion paper. Sebi has also met a longstanding demand of category-II FPIs by tweaking the ...

With two days left for rollout of goods and services tax (GST), the finance ministry has started notifying various provisions of law relating to interest calculation, input tax credit and valuation. Provisions in the Central GST Act (CGST), Integrated GST (IGST) Act and Union Territory GST Act and rules under them are being notified.These include those relating to tax invoice, credit and debit notes, accounts and records, returns, payment of tax, refund, assessment and audit, advance ruling. Also, appeals and revisions, transitional provisions, anti-profiteering and eway rules have been notified which shall come into effect from July 1.According to the notification, interest at 18 per cent is to be paid for delayed payment of tax, 24 per cent in the case of excess claim of input credit or undue/excess reduction in output liability. Besides, interest at the rate of 6 per cent would accrue in case refund is with held. With regard to IGST, provision prescribing refund of 50 per cent o...

The Insurance Regulatory and Development Authority of India (Irdai) has deferred the implementation of Indian Accounting Standards (IndAS) by a period of two years and it will now be implemented by 2020-21. The board of authority, after its meeting on May 31, noted the peculiarities of the insurance sector, particularly the fact that India does not have a standard equivalent to IAS39 on Financial Instruments: Recognition and Measurement. They came to the conclusion that the implementation of the IndAS in the present form will lead to the valuation of assets at fair value or market value, however, liabilities will continue to be valued as per the existing formula based approach. Hence, a mismatch would occur in the asset and liability valuation causing volatility in the financial statements of the insurance companies. Furthermore, this will lead to counting of compliance cost twice. It will be counted for the first time on the implementation of IndAS and secondly, when IFRS 17 is im...

Individuals having permanent account number (PAN) will have to link it to their existing 12digit biometric Aadhaar number from July 1,a government notification said. Aadhaar number or Aadhaar enrolment ID will also have to be mandatorily quoted while applying for PAN, which is a must for filing tax returns, opening of bank accounts and financial transactions beyond a threshold. Finance Minister Arun Jaitley, through an amendment to tax proposals in the Finance Bill for 2017-18, had made Aadhaar mandatory for filing income tax returns (ITR) and provided for linking of PAN with Aadhaar to check tax evasion through the use of multiple PAN cards. The Supreme Court had earlier this month upheld the validity of an Income Tax Act provision making Aadhaar mandatory for allotment of PAN cards and ITR filing, but had putapartial stay on its implementation till a Constitution Bench addressed the issue of right to privacy. Following the Supreme Court ruling, the revenue department has notified...