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The Model GST Law makes it clear that the proposed Goods and Services Tax (GST) regime would have imperfections and anomalies to begin with.For instance, input tax credit on capital goods would not be available for most sectors like transportation, construction and infrastructure. It follows that there would be no `seamless and efficient' crediting of taxes paid, to avoid tax-on-tax and cascading rates, as called for by the Arvind Subramanian Committee last year.   But no matter. The GST regime now in the works would be better designed and `clean' than is usually the case abroad. Now, over 160 nations have some form of value-added tax (VAT), which is what GST is. The idea, of course, is to reform the indirect tax structure, with tax payable only on the value-added at each stage of output or delivery , and input tax credits available for taxes already paid.   But as the Subramanian panel report noted, the tax regimes abroad tend to be either overly...

The tug-of-war between the BJP and the Congress over the GST (Goods and Services Tax) contin ues, delaying a nod to the much awaited tax reforms. If implemented, GST will have a far-reaching effect on India Inc and the broader economy. But it might take at least two years for it to show results, says Raamdeo Agrawal, co-founder, Motilal Oswal Financial Services. In an interview with Kshitij Anand, he said there was a 65-70% possibility that the legislation will go through in monsoon session. Edited excerpts:   How important is the GST Bill for the market? What kind of impact do you expect on the economy and on specific sectors? The probability may be significantly higher than the 50% right now. There is 6570% chance that it (GST) will go through this session. The environment is conducive and that is why the market has started performing. The market is thinking that there is a good chance of it going through. There is no obstruction and the market has not...

The Rajya Sabha on Tuesday passed a Bill which prohibits employment of children below 14 years in all occupations or processes except where the child helps  his family, with the provision for imprisonment up to two years for any violation.   The Child Labour (Prohibition and Regulation) Amendment Bill makes employment of children below 14 years as cognisable offence for employers and provides for penalty for parents.   The Bill, which was almost unanimously passed by voice vote, defines children between 14- 18 years as adolescents and lays down that they should not be employed in any hazardous occupations and processes.   It provides for enhanced punishment for violators. The penalty for employing a child has been increased to imprisonment between six months and two years ( from three months to one year) or a fine of Rs.  20,000 to Rs. 50,000 ( from Rs.10,000- 20,000) or both. The second time offence will attract impri...

Amendment Bill expected in current session of Parliament The government is amending Companies Act to relax provisions for Gujarat Gift Citys international finance centre.   The amendments will relax compliance norms. The amendment bill is expected to be introduced in the ongoing Parliament session. Companies operating in Gift  IFSC set up by Indians will not be considered foreign companies but these will be provided several operational freedoms. These companies will have flexibility in formation of their boards and on independent directors.   Companies in Gift IFSC will be private limited companies or unlisted public limited companies and the new provisions will have a set of relaxations for them, according to a source.   A law expert said companies in Dubais international finance centre operated under a separate law to help them make globally competitive.   “India is still conservative, the tax holiday is shorter and there are hard...

Starting from Tuesday , a group of empanelled chartered accountants are studying the books of 97 schools that have submitted proposals for fee-hike this year.   This process of submitting proposals and verification is based on the direction of the Delhi high court given in January, 2016.   Both chief minister Arvind Kejriwal and deputy chief minister and education minis ter Manish Sisodia, addressed the chartered accountants engaged for the job on Tuesday .“The exercise will be conducted by the empanelled chartered accountancy firm, under the Ernst &Young Foundation, and the report will be submitted to the Delhi Government in the second week of August.The Department of Education has received 97 proposals from various schools for increasing fees,“ says the government's statement.   “Education is a top priority for the Delhi Government and our objective is to ensure that education is not commercialised and parents and students are not exploited by a few un...

www.caonline.in News... 1. NIRC of ICAI is organising a Seminar on Valuation on 23 July at 10AM at India Habitat Centre (Jacranda Hall) Lodhi Road, New Delhi. Register & Pay at www.nircseminars.org. 2. SEBI issues draft paper on REIT(Real Estate Investment Trusts) to attract investors, realtors. 3. Manual signatures on digitally signed invoices is now a valid document for taking CENVAT credit. 4. Due date for payment of service tax under Voluntary Compliance Encouragement Scheme cannot be extended by courts under any circumstances whatsoever and for this purpose, mere giving of post-dated cheques would not amount to 'deposit' with government. 5. CBDT has notified the transfer pricing- computation of arm length price vide notification No. 57/2016 dated 14th July 2016. 6. Time limit for payment of tax and penalty under the Income Declaration Scheme 2016 extended to 30.09.2017. CBDT Press Release dated 14.07.16.

Provision in scheme lets I-T dept to go after evaders for undisclosed assets acquired well before 6 yrs, but law doesn't allow it An anomaly in the Income Declaration Scheme (IDS) -a mechanism to disclose hidden assets and come clean -can trigger litigation and go against the present law. In the course of recent meetings aimed to maximise mobilisation under IDS, senior tax officials have told members of Central Board of Direct Taxes (CBDT), the apex body, about the problems that could crop up. A provision in the scheme allows the I-T department to go after evaders for undisclosed assets acquired well before six years. Today, tax officers, as per law, refrain from reopening assessment which are more than six years old. “The IDS changes this as it empowers assessing officers to revisit old matters. It is against the Income-tax Act and settled nature of tax assess ment,“ said a tax official in Mumbai. The issue cropped up after the government released the FAQs on the dec...

Opposition parties and the government agreed on Monday, opening day of Parliament's monsoon session, to allocate five hours for a discussion on the goods and services tax (GST) Constitutional amendment Bill in the Rajya Sabha. However, the opposition had a caveat — they'd agree to discussion after the government reached out to all parties for a consensus on the issue. A government source said the Rajya Sabha Business Advisory Committee had "in principle" allocated five hours for the discussion but no date. Government sources said more consultation with the Congress and other parties will take place in the coming days, to pass the Bill "unanimously". A Congress leader said the party was still awaiting a "written" offer from the government about the three amendments it wanted in the Bill. A minister groused that the Rajya Sabha committee which examined the legislation and had a majority of Congress members had no dissent note in its report, g...

India will likely sign a bilateral investment treaty ( BIT) within the next few months with the US, Canada or Cambodia. That taxation matters have been kept out of the BIT is not a cause of concern, as the nations with which India is negotiating the agreement have been assured that the provisions under Double Taxation Avoidance Agreement ( DTAA) are adequate to provide protection to foreign companies operating here, governmentsources told Business Standard. BIT, the model draft of which was cleared by the Union Cabinet in December 2015, is expected to eventually replace the existing bilateral investment protection and promotion agreements (BIPPAs) that India has signed with 72 nations. India will also sign BITs with countries it has had no comprehensive investment agreements with before, including the US. BIT keeps taxation out of its ambit with the idea that foreign companies finding themselves in a tax row with the government will not be able to invoke the investment treaty the...

In the first tranche, CBDT to issue letters to those spending Rs.1 crore a year The income- tax department has zeroed in on 900,000 high- value spenders and plans to confront them with the database of their transactions, to persuade them to avail the black money window — Income Disclosure Scheme ( IDS), 2016 — that will close on September 30. In the first tranche, the department will send out letters in 100,000 cases where the money spent is at least Rs. 1 crore each a year. Letters for the remaining cases would be sent in batches. In the second stage, letters would be issued for cases involving spending above Rs. 50 lakh. “A detailed exercise has been carried out and we have prepared a database of 0.9 million ( 900,000) pieces of information (on cases of high- value and potential unreported cases)... This is one area to tackle tax evasion. We will issue them (taxpayers) letters and confront them that we have information,” Central Board of Direct Taxes Chairman Atulesh Jindal...

www.caonline.in News... 1. Refund will be allowed even after surrender of registration certificate of un-utilized cenvat credit for export of goods as there is no express prohibition in terms of Rule-5. (General Commodities Private Limited Versus Commissioner of Central Excise)- 2016 (7) TMI 653- CESTAT BANGLORE. 2. CA Result Final both Group 11.36%, 1st-18.21%, 2nd-18.77%, CPT-38.98%. Congratulations to all passed out students. 3. New online PAN application facility has been launched for PAN applicants with an option of paperless submission of application using Aadhaar based e-sign. 4. Comvat has issued instructions that there is no provision in law to block of Central Statutory Forms on the ground of issuance of notice u/s 59(2) forms on this ground. Even in exceptional cases VATO himself can unblock the issuance without approval from Zonal Incharge. TEAM STBA 5. Last Date of filling of ITR for the A.Y. 2016-17 is 31st July,2016.