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Showing posts from August 22, 2017

FMCG dealers seek to recover GST cost from companies

FMCG dealers seek to recover GST cost from companies  Companies in FMCG and consumer durable space are facing a surprise bouncer from their dealers experiencing goods and services tax (GST) transition blues.  Dealers have sought compensation from companies as they are unable to claim credit on the past stock and therefore, have to shell out extra tax from their pocket for now. This has raised their working capital costs.  “There is a minor working capital cash shock for the dealers in the month,” said a source, adding that industry is still grappling with the fine print of this major tax reform.  “There is a lot of fine print within the GST that is yet to be clarified. There is confusion in the trade on issues such as input credit which are still persisting. We are awaiting clarity on the same,” said an official with a leading FMCG company.  Trade partners of most consumer goods and durables firms had destocked in the two weeks just ahead of the GST rollout to ensure they were not saddled …

Around 100 brokers under lens for helping shell companies

Around 100 brokers under lens for helping shell companies Sebi, tax department investigation brokers who may have helped shell companies launder Rs 16,000 crore by compromising KYC norms The Securities and Exchange Board of India (Sebi) and the income-tax department are investigating the role of about 100 brokerages which they believe may have helped shell companies launder as much as Rs16,000 crore by compromising so-called know-your-customer (KYC) norms, said two people with direct knowledge of the matter.This is part of an ongoing probe into shell companies by the ministry of corporate affairs, which has identified some 16,000 potentially bogus firms after drawing inputs from the Serious Fraud Investigation Office, Central Bureau of Investigation and Enforcement Directorate, these people said. The 331 firms that Sebi branded as suspected shell companies on 8 August were part of this list. Out of the 16,000 firms, some 10,000 were flagged by the income-tax department. Sebi did not resp…

BSE brings provision to stem expiry day losses on options

BSE brings provision to stem expiry day losses on options The BSE will introduce a facility on index and stock options contracts wherein trading members can opt for a `do not exercise' instruction on certain in-the-money contracts on expiry day.  The facility will be a relief for brokers and traders as the letting the profit-making options positions expire could potentially lead to enormous losses for options traders.  In the case of options trading, the securities transaction tax (STT) is around 0.05 per cent on the premium and STT on exercising an option is 0.125 per cent. When an option is exercised, STT is paid on the entire value of the option and would imply massive liability for an unsuspecting trader.  NSE, which is the market leader in equity derivatives, is yet to announce this facility, but brokers say they expect the exchange to announce a similar system soon.  Currently, all open long positions across in-the-money options contracts are automatically exercised and cash sett…

First filing under GST yields Rs 42,000 crore

First filing under GST yields Rs 42,000 crore As much as Rs 42,000 crore has as taxes so far in the under the new services tax (GST) regime, are expected to swell further cycle closes later this week. Asenior official said that crore has come in as Integrated is levied on interstate movement and another Rs 5,000 crore demerit goods like cars and The remaining Rs 22,000 in as Central GST and State would be split equally between and state governments. "Tax deposited till this Rs 42,000 crore," the official far, one million taxpayers filed returns and another two have logged in and return forms. "We are seeing good compliance and estimation is that 9095 cent of the assesses will returns and pay taxes," he Under the GST regime, which was implemented from July 1, businesses are expected to file the monthly tax return. Tax for the first month is to be filed by an extended deadline of August 25. The deadline was extended as the tax return filing website snapped justaday before…

Banks to pay 3% IGST on gold imports: CBEC

Banks to pay 3% IGST on gold imports: CBEC Banks importing gold and precious metals will have to pay 3 percent tax under the goods and services tax (GST), which can be claimed as input tax credit. Clarifying issues on the GST on gems and jewellery through frequently asked questions, the Central Board of Excise and  Customs said banks did not pay any value added taxon import of precious metals previously. They only paid Customs duty.  However, under the GST, “3 percent Integrated GST, or IGST, is payable on all imports of precious metals in addition to the basic Customs duty. IGST paid can be taken as input tax credit by the banks.” It also said banks would be liable to pay IGST on such imports and not any over seas supplier in which ownership is vested during movement of gold or silver. The Business Standard, New Delhi, 22th August 2017