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Showing posts from August 3, 2017

This is how I-T department is using data analytics to catch tax evaders

It’s not unusual to form an investment company for buying an expensive residential apartment. But in the case of a city Golf Link Road apartment, the ultimate beneficiary was found to be director in an investment company —living in a modest house in Seelampur, earning less than Rs 1 lakh a year and not owning a car or a credit card. Income-tax officials suspected it to be a benami transaction, a property bought by a businessman in his driver’s name.  Uncovering the culprit would take them through a confounding maze of data — phone records, credit card and PAN details, tax returns and even social media platforms. Here’s where data analysts and number crunchers come into play. “It’s virtually impossible to go through various structured and unstructured data sources and make sense of them,” said an official. “But data collected via various sources leaves a pattern and analytics can raise red flags that tax officers can investigate further.”  Rise of number crunchers Amit Maheshwari, partner,…

Arun Jaitley indicates scope for rationalisation of rates under GST

Finance minister Arun Jaitley on Wednesday said there is scope to rationalise goods and services tax (GST) and rolling 12 per cent and 18 per cent slabs into one as implementation of the country’s most comprehensive indirect tax reforms progresses.  “I do concede that as it (GST) moves forward, there will be scope for rationalising the rates.  There, probably, will be scope that the two standard rates of 12% and 18 per cent, after some time, could be clubbed into one. That is a fair possibility and a suggestion,” Jaitley said replying to debate on the two bills related to GST in J&K.  Central Goods and Services Tax (Extension to Jammu and Kashmir) Bill, 2017 and the Integrated Goods and Services Tax (Extension to Jammu and Kashmir) Bill, 2017 were later passed by a voice vote.  The current GST has 5 per cent, 12 per cent, 18 per cent and 28 per cent rates, plus one for luxury and sin goods. There are some that are zero rated, or nil rate.  Jaitley said if the two rates had been merged …

2.7 mn assessees yet to fully migrate to GST portal

Failure to do so will lead to cancellation of the provisional ID after the statutory three months As many as 2.7 million of the 7.1 million who were assessed under the pre-goods and services tax (GST) system and have activated their accounts on the latter portal, are yet to complete the entire enrollment process. As a result, they are yet to file returns, said GST Network, the body handling the system's information technology backbone. "If you have activated your provisional ID for migrating to GST but not completed all the enrolment formalities, you might be heading for a dead end at the time of filing GST returns," GSTN said. After the initial process of activation of the provisional ID, a taxpayer has to fill Part-B of the enrolment form at the GST portal, providing relevant information regarding the business, including the authorised signatory. Submission of the completed form with digital signature certificate or electronic verification code entitles the taxpayer to the…

Insolvency Board to pull up firms acting as resolution professionals to banks

The Insolvency and Bankruptcy Board of India (IBBI) is looking into a complaint that some professional service firms were acting as insolvency resolution professionals (IRPs) to help banks manage and restructure insolvent companies.  Under law, professional entities can't enrol themselves as an insolvency professional or become a member of another agency registered with the IBBI to do the job. According to an official aware of the matter, an independent IRP had written to the board accusing some firms of breaking this rule.  The complainant alleged that invoices were raised by these firms and not the insolvency professionals, who in most cases were employees of the firms, the official said.  There are about 800 individuals who are registered as IRPs. While professional service firms are barred from becoming an IRP, their executives can do so in their individual capacity. Most banks stay away from appointing people with no firm to back them as IRPs.  "The letter also states that t…

IGST to be levied only when goods are brought for customs clearance

The integrated goods and services tax (IGST) would not be levied on sale of goods on high seas but would be charged when they are brought for customs clearance, authorities have clarified, much to the relief of oil and gas, power and telecom companies.  The Central Board of Excise and Customs (CBEC) has issued a circular to this effect after receiving references on the issue as all inter-state transactions are subject to IGST.  'High sea sale' is a common trade practice where in original importer sells goods to a third person before they are customs cleared. Final customs clearance is filed by the final owner. CBEC has said IGST would be required to be levied only once at the time of importation of goods, which is when goods are cleared by customs.  It also clarified that value addition accruing in each high sea sale transaction shall form part of the value on which IGST would be levied at the time of clearance.  This means that IGST would be payable on the value for the last buye…

Scope to Club 12% & 18% GST Slabs Into One Later: Jaitley

Finance minister said if the two rates had been merged into one, its inflationary effect would have been high & thus govt didn’t get into this exercise Finance minister Arun Jaitley on Wednesday said there is scope to rationalise goods and services tax (GST) and rolling 12% and 18% slabs into one as implementation of the country’s most comprehensive indirect tax reforms progresses. “I do concede that as it (GST) moves forward, there will be scope for rationalising the rates.  There, probably, will be scope that the two standard rates of 12% and 18%, after some time, could be clubbed into one. That is a fair possibility and a suggestion,” Jaitley said replying to debate on the two bills related to GST in J&K. Central Goods and Services Tax (Extension to Jammu and Kashmir) Bill, 2017 and the Integrated Goods and Services Tax (Extension to Jammu and Kashmir) Bill, 2017 were later passed by a voice vote. The current GST has 5%, 12%, 18% and 28% rates, plus one for luxury and sin good…

RBI Cuts, but cautiously

The Reserve Bank of India (RBI) lowered its policy interest rate by 25 basis points (bps) and said the future course of inflation would depend uponacombination of factors, including states implementing farm debt waivers. The sixmember Monetary Policy Committee (MPC) observed the inflation rate had fallen toahistoric low but “aconclusive segregation of transitory and structural factors driving the disinflation is still elusive”. After the latest policy review, the repo rate, at which the central bank lends to banks, stands at 6 per cent. The RBI maintained its neutral monetary stance. The rate cut was part of its calibrated approach based on the data available, RBI Governor Urjit Patel said inapostpolicy conference. “We could have stronger growth by removing infrastructure bottlenecks, finding measures to reinvigorate private investments and providingathrust to government´s affordable housing initiative, which hasapotential for very strong multiplier effects,” Patel said. “Addressing the tw…