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Finance Minister Arun Jaitley chairing the ninth GST Council Meeting, at Vigyan Bhawan in New Delhi on Monday. (PTI) The central government today formally accepted that it will not be able to meet the April 1 deadline for implementing the Goods and Services Tax (GST). The new deadline has been set for July 1, 2017. At the end of the ninth GST Council meeting, finance minister Arun Jaitley said: “The broad consensus among states is that July 1 seems more realistic”. But many states hinted that even the new deadline looks difficult to meet. “A lot of work is left, in fact, thirteen things need to be done before we even consider implementing GST. So I don’t want to comment want to on whether the July 1 deadline can be met,” said West Bengal finance minister, Amit Mitra. Jaitley said that Monday say consensus on tax on territorial waters and dual control, which deals with who taxes whom between the states and the centre. 90% of taxpayers with up to Rs 1.5 cr annual turnover will be assess...

Individuals will be asked to divulge source of large cash transactions post demonetisation   The government said it has identified 18 lakh individuals who will be required to divulge the source of large cash transactions that they  undertook in the weeks after demonetisation as part of the income-tax  department’s Operation Clean Money/ Swachh Dhan Abhiyan initiative.   An integral part of the government’s campaign against black money, the  account holders have been targeted through the use of data analytics  to sift through information for the period between November 9, when the  old Rs 500 and Rs 1,000 notes ceased to be legal tender, and December 30, when the window for their deposit in banks ended.   These 18 lakh persons have been identified by the tax department as their  transactions did not match their tax profile. Cases are being selected for verification on the basis of approved risk criteria, officia...

Jewellery sector will be most disappointed if no relief comes from Budget, especially after note ban Economic Survey for 2016-17 has indicated that implicit subsidy for gold is still too high and it mostly goes to the middle class. Market participants say that this indicates that government is looking to have higher tax revenues from gold. Survey notes that the calculations of implicit subsidies for the middle class, which forms top 40 per cent population, is estimated based  on expenditure distribution as per NSS data of 2011-12 LPG subsidy for this class has been estimated at Rs 28,219 crore for 15-16 and for gold it has been estimated at Rs. 10,800 crore which is  0.08 per cent of GDP. Surendra Mehta, secretary, Indian Bullion and Jewellers Association said that, "indications from the survey which says  that implicit subsidy on gold is still high is building a case for GST rate higher that 4 per cent". Going by survey indications, he doesn't think there will be reduct...

ANUPROY The Economic Survey 2016-17, released on Tuesday,yet again harpedonusing the Reserve Bank of India’s(RBI) equity to recapitalise  government banks. It argued after demonetisation, the “windfall” would boost the central bank’sfinances. Last year,when the Survey made this suggestion,then RBI governor Raghuram Rajan was critical of the proposal, arguing high equity  was needed for the stability of the central bank. After Prime Minister Narendra Modi announced the demonetisation of the old series Rs 500 and Rs 1,000 notes on November 8,people  had till December 30 to deposit the old  notes in banks. This led to the “windfall” of swelling deposits. This year, the Economic Survey has argued the central bank had more than adequate equity.Infact,it had the fourth largest equity  as a percent of central bank balance sheet in the world.From this,the RBI could easily return Rs 4 lakh crore to the government. “There is no particular reason why this extra capital sh...

N SUNDARESHA SUBRAMANIAN Opening with spiritual leader Ramakrishna Paramhansas" Takamati, matitaka ,"Bengali for money is mud,the Economic Survey 2016 17s  demonetisation chapter skipped difficult questions on note-ban implementation,while trying to figure out how best to milk the note  ban, described as money-vacuuming chopperor "helicopter hoovering” or the opposite of helicopter money, which involves distribution of printed money to the public. Advising against any impulse to penalise cash withdrawals in the short term,chief economic advisor Arvind Subramanian in the Survey  said, "The early elimination of withdrawal limits will help build confidence.By the same token, there should be no penalties on cash withdrawals, which would only encourage cash hoarding." Supply of currency should follow actual demand and not be dictated by official estimates of "desirable demand". In other words,"the Reserve Bank of India should re-establish internal co...

It adds, Bengaluru and Jaipur are collecting no more than 5 to 20% of the potential India’s urban local bodies, or municipalities, have a huge potential to raise resources through taxation such as property tax, the Economic Survey said. It said a low level of per capita expenditure of Urban Local Bodies (ULBs) against state per capita expenditure shows either states are not devolving adequate financial resources for these bodies or ULBs are not raising resources on their own. The Survey’s assessment of property tax collection potential of Bengaluru and Jaipur shows that currently both these cities are collecting no more than 5 to 20 per cent of the potential. The study on municipal finances conducted by the 14th Finance Commission indicated per capita revenue from property taxes was ~1,677 at most, with a low of just Rs 42. The Survey said with higher devolution of taxes to the states and grants to ULBs after the 14th Finance Commission, overall public funds available for urban rejuve...

Initiating stringent action against black money holders after note ban, the income-tax (I-T) department on Monday said it has issued 87 notices and frozen bank deposits worth crores in 42 cases nationwide under the newly enforced benami (nameless)Act, which attracts a heavy penalty and rigorous jail term of a maximum seven years. After demonetisation order of the government on November 8 last year, the department had carried out public advertisements and had warned people against depositing their unaccounted old currency in someone elses bank account saying such an act would attract criminal charges under the Benami Property Transactions Act, 1988, applicable on both movable and immovable property, that has been enforced from November 1, 2016. The I-T department is the nodal department to enforce the Act in the country. The taxman has issued numerous summons under the Act and is in the process of issuing more. The decision, officials said, to slap the stringent provisions of the ...

Facing criticism from the Election Commission (EC) for not allowing candidates contesting the coming Assembly polls to withdraw cash up to their legal limit, the Reserve Bank of India (RBI) on Monday removed withdrawal restrictions on current, cash credit and overdraft accounts with immediate effect. ATM withdrawal restrictions will also be eased from Wednesday, RBI said. A savings account holder may now withdraw up to Rs 24,000 at one go from ATMs. Earlier, the limit on such accounts was Rs 10,000 per day, with a weekly cap of Rs 24,000. The overall limit on savings accounts will, however, continue. The cap for savings account holders is Rs 24,000 per week.“The limits on saving bank accounts will continue for the present and are under consideration for withdrawal in the near future,” RBI added. RBI also said banks may, at their discretion, have their own operating limits as was the case before November 8, when note ban was imposed. The reason behind the move was the “pace of...

Purchases from Rs 50,000 to Rs 1 lakh may require details from next FYThe next time you visit your neighbourhood gold or silver jewellery store you might have to quote your PAN or Aadhaar card number for purchases aboveRs. 50,000-1 lakh. Currently ` , only purchases above Rs. 2 lakh require know-your-customer-compliance in the gold market. Chartered accountant Bhargav Vaidya, who provides consultancy services to the gems and jewellery sector, and the secretary of one of the country's largest bullion association, expects the KYC requirements for bullion and jewellery to be revised lower from the present Rs.2 lakh in Budget FY18, to be presented on Wednesday . “I think the KYC (compliance) will be cut to Rs. 50,000 from Rs.2 lakh at present in the Budget for FY18,“ said Vaidya, proprietor of BN Vaidya & Associates. Apart from the trade, financial regulators take feedback while drafting policy for gold trade from Vaidya. Any such move would come amid the government's crack...

Concerned over a large number of companies indulging in illegal money pooling activities, markets regulator Sebi today cautioned investors and general public against dealing with such entities -- 256 as per the latest update. Securities and Exchange Board of India (Sebi) has cautioned investors against unlisted firms issuing securities without complying with the market norms. It advised investors to ensure that the companies seeking to raise funds have filed offer documents or applications with stock exchanges for listing. Some unlisted companies are luring retail investors by issuing securities, including non-convertible and convertible debentures, non-convertible and convertible preference shares, equity shares in the garb of private placement without complying with requisite provisions of the law, Sebi said in a statement. It has taken several prohibitory actions against these 256 firms. Among such firms are Sunshine Agro Infra, Greater Kolkata Infracon, Megasys Healthcare...

Wants TDS to be cut from 10% to 2%, and applied on commission earned, not on gross invoice value The staffing industry, representing companies such as Team Lease and Quess, wants finance minister Arun Jaitley to resolve the tax anomalies it faces, in the upcoming Budget. The Indian Staffing Federation says that its demand assumes significance since post-demonetisation it is the formal sector which will grow and the staffing industry will play a crucial role in that. The industry represents contract hiring in organised industry done through tri-partite agreements -- between the company that is hiring, the person hired and the staffing industry. The Federation said tax deducted at source (TDS) is imposed on the gross invoices received by its members from its client companies, whereas it should be on just the commission received by the staffing companies. While this amount is adjusted later, it takes about a year to happen, creating cash flow problems for staffing companies, s...