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They will travel across the country, address industry chambers and traders’ groups Worried that confusion might hit the roll-out of the goods and services tax (GST), members of the Union council of minister would travel across the country from July 2 to 7. The new indirect tax regime would be rolled out from July 1. The ministers would meet stakeholders — especially industry chambers and traders’ groups — to clear doubts.The three-week period starting International Yoga Day (June 21) is likely to be a stressful one for the ministers. Prime Minister Narendra Modi is scheduled to be in Lucknow to mark the day. Other ministers have been asked to visit state capitals or their constituencies to perform yoga. If you have not been able to register on the GST Network within the deadline ending on Thursday, do not panic! There's one more chance coming your way as the registration for existing excise, service tax and VAT payers will reopen on June 25. There are about 8 million excise, se...

The new tax regime will not allow retailers a full set-off on goods procured in the last six months If you have been bitten by the shopping bug, you can’t be blamed. Well, at least, not this year. After all, it is not often that retail stores offer steep discounts in the months of May–June. While monsoon sales by apparel stores usually start by end of June and electronic stores do have some clearance sales in June-July, this year with the Goods and Services Tax (GST) starting from July 1, discounts are bigger than before. For instance, electronic stores like Vijay Sales, Kohinoor and Digi1 are offering up to 50 per cent off on certain models or till stocks last. Snehanjali, another Mumbai-based electronic chain is advertising its offer as the pre-GST sale with a warning thrown in for good measure that “Prices for most electronic items are set to rise by 5 per cent’’. Electronic manufacturer Samsung is offering free DTH connection with televisions and extended warranty periods and f...

The Securities and Exchange Board of India (Sebi) has issued a comprehensive framework on margin trading facility (MTF) including disclosure norms and eligibility requirements for brokers to provide it to clients. The facility is executed with borrowed funds or securities that enable investors to take exposure in the market over and above their resources. The markets regulator said in a circular that only corporate brokers with networth of atleast Rs 3 crore are eligible for providing MTF to their clients. The brokers would have to submit to the exchange a half yearly certificate from an auditor confirming the net worth.For providing MTF,a broker may use his own funds or borrow from scheduled commercial banks or NBFCs regulated by the Reserve Bank of India. Business Standard New Delhi, 15th June 2017

A proposal to introduce a Bill in Parliament for setting up a Resolution Corporation to deal with bankruptcy in banks, insurance companies and financial entities received the Cabinet go ahead on Wednesday. The Financial Resolution and Deposit Insurance Bill, 2017, which aims to instil discipline in financial service providers in the event of a financial crisis by limiting the use of public money to bail out distressed entities, was approved by the Union Cabinet chaired by Prime Minister Narendra Modi on Wednesday, an official statement said. The proposed Bill will provide for  a comprehensive resolution framework to handle any bankruptcy situation in banks, insurers and financial sector entities.According to the statement, the Bill—when enacted—will pave the way for setting up of a Resolution Corporation. It would also lead to repeal or amendment of resolution related provisions in sectoral Acts as listed in Schedules of the Bill. “It will also result in the repealing of the De...

Once the goods and services tax (GST) is rolled out, targeted from July 1, makers of fast moving consumer goods should be able to cut prices by 2 to 20 per cent, said Kishore Biyani, group chief executive officer of the Future Group on Tuesday. He was attending a meeting of a dozen national and international retail chains, such as Walmart, DMart, Future Group, Aditya Birla Retail, and Trent in Mumbai.They were discussing the impact of the GST on retailers and customers.Biyani said the Future Group´s consumer goods company, Future Consumer, would cut prices by 220 per cent. The CEO of another retail chain, who did not want to be named, said in the GST regime, retailers could lose up to 23 per cent of their margins if FMCG companies did not revise prices.“Our net margins are 23 per cent. If we are not given input credit, we will incur losses,” he added. Retailers said printing GST rates would also have a negative impact on consumers. According to the rules, retailers would have to di...

The government on Tuesday said that good and services tax (GST) will be rolled out from July 1 and preparations are in full swing for its smooth implementation, as it sought to dispel rumours of a possible deferment.There have been demands from certain sections of the industry for a deferment of GST rollout.West Bengal Finance Minister Amit Mitra too had proposed to postpone GST by a month. “The government said GST is scheduled to roll out on July 1.The Central Board of Excise and Customs in coordination with the states have raised their out reach programmes,"a finance ministry said. Business Standard New Delhi, 14th June 2017

A farmers´ association has asked the government to roll back 5 per cent goods and services tax (GST) on raw tobacco and exempt it from the tax bracket like any other agricultural crop.Fearing drop in prices of tobacco leaves and raw tobacco after the new tax regime come into effect next month, tobacco farmers across Andhra Pradesh have stalled auctions in all platforms, said the Federation of All India Farmer Associations (FAIFA) in a statement. Terming the rate on tobacco “unrealistic”, farmers said it will severely endanger their livelihoods and asked the government to do away with it in the upcoming GST review meeting on June 18. “Farmers from different auction platforms in the Southern Black Soil (SBS) region decided not to bring their produce to the market to protest 5 per cent GST on tobacco leaves and 28 per cent on unmanufactured tobacco,” said FAIFA Vice President Gadde Seshagiri Rao. According to FAIFA, raw tobacco and unmanufactured tobacco were exempted from the central...

A tenant paying Rs 50,000 monthly rent must deduct TDS and deposit it with the income tax department For the past four-five years, the income tax (I-T) department has been consistently tightening its noose around realty transactions. From making registration of rental agreements with PAN details of both the tenant and owner mandatory to the latest — deduction of TDS (tax deducted at source) on monthly rental of Rs 50,000 and above - rules have been tightened significantly to ensure black money isn’t generated from this sector. The Central Board of Direct Taxes’ (CBDT’s) latest salvo targets people who claim significant amounts as house rent allowance (HRA), sometimes with the help of false documents. From June onwards, those who pay monthly rental of Rs 50,000 need to deduct 5 per cent TDS and deposit it with the I-T department. This TDS trail will serve as proof for people claiming high HRA. The provision was introduced in the Finance Bill, 2017. “The idea behind the provision is ...

Sebi has permitted European-style options, with a fixed settlement period The Securities and Exchange Board of India (Sebi) has issued a circular allowing commodity exchanges to launch options trading in commodities. Initially, an exchange can launch options in only one commodity and the position limits for options will be double that of the respective futures contract. The settlement of commodity options will be complex as they become futures contracts on settlement. This mechanism has been introduced to allow option-holders to give or take delivery, which is not possible in the current legal framework. Sebi has also specified criteria for commodities to be allowed for options trading. The commodity must be among the top five by traded volume on an exchange and the daily average volume over the previous 12 months must be Rs 200 crore for agri and agri-processed commodities and Rs 1,000 crore for non-agri commodities. Exchanges are still deliberating on their choice of commodities ...

The Securities and Exchange Board of India (Sebi), capital markets regulator, is planning to ease entry norms for overseas investors by allowing direct access to foreign portfolio investors (FPIs) from certain jurisdictions. The move is expected to give a fillip to foreign investment in the country as it would end procedural delays faced by FPIs while registering in India. On the other hand, Sebi is likely to tighten off shore derivatives instruments (ODI) or participatory notes (p-notes) regulations. The announcements were likely to be made after Sebi’s board meeting scheduled for June 21, sources said. According to sources, the entities registered with regulators that are signatories to the International Organisation of Securities Commissions’ (Iosco’s) multilateral memorandum of understanding (MMOU) would not have to undergo the cumbersome registration process required to be eligible to invest in the Indian market. In other words, an investor ‘A’ is regulated by the UK’s Financi...

These cover 25% of bad loans of banks The Reserve Bank of India on Tuesday said its internal committee (IAC) had 12 accounts that covered about 25 per cent of the banking system´s non-performing assets for immediate resolution under the Insolvency Bankruptcy Code. The gross bad debt of the Indian system as of March was at Rs 7.11 lakh crore, which means the 12 accounts would be responsible for about Rs 1.78 lakh crore.The central bank did not give the names of the borrowers. The government has amended the RBI Act, giving powers to the central bank to direct banks to take punitive action against individual accounts under the Code.Earlier the central bank could give directions only on an industry basis. The process of appointing a professional to take over the management of a company and then come out with a solution to repay loans will take a long time and may not be a workable solution, say corporate lawyers. The process begins with the banks approaching the National Company Law Tr...