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BUDGET SHOULD FOCUS ON  ECONOMIC JOB  GROWTH, SAYS  CHIDAMBARAM The fifth and last Budget of the Narendra Modi government would need to address the problem of economic growth and meet the challenge of creating jobs, senior Congress leader P Chidambaram and former deputy chairman of the erstwhile Planning Commission Montek Singh Ahluwalia said on Tuesday. Participating in a panel discussion after former president Pranab Mukherjee launched Chidambaram’s book, Speaking Truth to Power, a collection of his essays published in newspapers, Ahluwalia and Chidambaram disputed recent claims in a study that the Modi government created 7 million jobs. Ahluwalia termed the inferences of the study based on Employees' Provident Fund Organisation data was “flawed”. Chidambaram said the Economic Survey was “an utter confession” that in the four years the Modi government has failed to deal with three of the biggest issues — employment, education and agriculture. He said the attempt...

PM EMPLOYMENT SCHEME ALLOCATION MAY BE HALVED FinMin had informed labour min of reduction in budgetary support to PMRPY to Rs. 5 billion in RE The finance ministry may likely trim budgetary support towards the Pradhan Mantri Rojgar Protsahan Yojana (PMRPY), a flagship programme for incentivising job creation, substantially for the present fiscal year in the Union Budget to be presented on Thursday. Government sources said the finance ministry had informed the labour ministry of a reduction in the budgetary support towards the PMRPY to Rs. 5 billion in the Revised Estimates, from Rs. 10 billion allocated in the Union Budget 2017-18. Finance Minister Arun Jaitley had announced the PMRPY in the Union Budget 2016-17 to incentivise employers for boosting employment generation. In this initiative, the government pays the employers’ contribution of 8.33 per cent of wages under the Employees’ Pension Scheme (EPS) in the first three years of hiring a new employee. The EPS is adminis...

 TAX SOPS TO WOO INDUSTRY SET FOR A COMEBACK A recent notification by the Assam government announcing a scheme for reimbursement of taxes paid by state-based industries has been a kin to setting the proverbial cat among the pigeons. Tax experts expect the move to trigger a race among other states to offer similar sops to woo investment.  While the Goods and Services Tax (GST) Council has left it to each state to come out with individual schemes for reimbursing industries that enjoyed various area-based exemptions, the sops by Assam government queers the pitch by extending these sops to new industries and those expanding their existing units. The Assam Industries (Tax Reimbursement for Eligible Units) Scheme, 2017, notified on January 19, allows eligible units reimbursement of state GST (SGST) after utilisation of the input tax credit of available SGST and integrated GST (IGST). The benefits have been extended to new units and also to those expanding existing ones. The ...

 EPFO: Firms can pay dues, update ownership details Taking another step towards going paperless, retirement fund body Employees’ Provident Fund Organisation (EPFO) on Tuesday said it has launched facilities for employers to pay dues and update ownership deatils online. the EPFO has provided facility of online submission of Form 5A (Return of Ownership), it said in a statement. The EPFO added it has discontinued the physical submiion of the form. earlier, the employers had to submit a physical copy of Form 5A to the concerned EPFO feild office upon new registration of establishment and wheneverthere was any change in ownership details. Now, employers can updatre Form 5A online and submit with e-signature. This will not only reduce the unnecessary paperwork, but also avoid visits to EPFO feild offices.  The Business Standard, New Delhi, 31st January 2018 ------

Tax uncertainty over insolvency deals likely to go The government may consider resolving two of the biggest tax roadblocks looming over a successful conclusion of the insolvency process in the upcoming Budget, two people close to the development said. The government may allow carrying forward of losses for eight years for buyers of companies in the insolvency process. This is not allowed under the current tax laws and buyers have been asking for such a relief. it may also address industry fears of the income tax department challenging the valuations after the conclusion of deals. "The government allowed carrying forward of losses for eight years for the startups last year. Similar exception is being considered for deals happening in insolvency," a person close to the development said. Industry trackers said the tax outgo could be higher if the buyer of an insolvent company is unable to set off losses or carry it forward on the balance sheet. "Section 79 of th...

Single GST registration for airlines, banks on the anvil The government is considering a nationwide single GST registration process for the aviation, banking and insurance sectors, people in the know of the matter said. A single registration will potentially solve a majority of the compliance problems that services companies have been complaining about. They now have to register themselves and file GST returns in every state or union territory (UT) they operate in. But the change will require the approval of the GST Council, the top decision-making body under the new tax system, where states are expected to oppose it fearing revenue loss as they have done when the proposal had come up before, tax experts said. But the change will require the approval of the GST Council, the top decision-making body under the new tax system, where states are expected to oppose it fearing revenue loss as they have done when the proposal had come up before, tax experts said. While goods-producing ...

Need to stabilise GST implementation to facilitate easier compliance: Economic Survey India needs to work towards stabilising the goods and services tax, removing uncertainties for sectors such as exports, the Economic Survey said while pitching for a review of tax embedding caused by the exclusion of some products from the ambit of the new levy. "The government will also need to stabilise GST implementation to remove uncertainty for exporters, facilitate easier compliance, and expand the tax base," the Economic Survey 2017-18 said. The rollout of the new tax was marred by hiccups related to compliance, prompting the GST Council to expeditiously revisit provisions such as rates on household goods and those for small-scale sectors. It termed GST revenue collections as 'surprisingly robust' given that these are early days of a disruptive change. "revenue collection under the GST is doing well, surprisingly so, for such a transformational reform," it sa...

Taxpayer base up 50% since GST Bolstered by sharp growth in the tax base, goods and services tax (GST) revenue mop-up has been ‘surprisingly robust’ despite ‘teething difficulties’, said the Economic Survey 2017-18. The indirect tax base grew 50 per cent since the GST roll-out, led by a large increase in registrations, especially by small enterprises. The demonetisation of high-value currency notes in November 2016 resulted in widening of taxpayers’ base, the Survey said. As of December 2017, there were 9.8 million unique GST registrants, slightly more than indirect tax registrants under the earlier system. Although not comparable, GST has increased the number of unique indirect taxpayers by more than 50 per cent, a substantial 3.4 million. “The two numbers are not comparable. Registrants in the old system were not unique, since many taxpayers were registered under several taxes,” the Survey said. Maharashtra, Uttar Pradesh, Tamil Nadu and Gujarat have the largest number of G...

Low success rate in resolving disputes Tax departments have had a success rate below 30 per cent in dispute resolution, Economic Survey 2017-18 pointed out A whopping 66 per cent of pending cases accounted for only 1.8 per cent of the value at stake and a minuscule 0.2 per cent of cases accounted for 56 per cent of value at stake, showing an adversarial tax regime in the country. The government had in 2016-17 modified the annual appraisal proforma of income tax officials, giving weight to their assessments orders being upheld on appeal. The Survey said collections of direct taxes by states and local governments were significantly lower than those of their counterparts in other federal countries such as Brazil or Germany.Meanwhile, there has been an addition of about 1.8 million individual income tax filers since demonetisation in November 2016, according to the Survey. Measures such as GST and demonetisation have led to an increase in personal income tax collections, substant...

Sebi limits trading in security receipts to qualified buyers Sebi’s move aimed at allowing only informed investors to trade in the securities A private placement, rather than a public issue, is the markets regulator’s favoured route to start trading in securities receipts issued by asset reconstruction companies (ARCs).Only certain “qualified buyers” will be permitted to trade in them, and the minimum lot size will be Rs10 lakh. The intention is to allow only informed investors to trade in these securities. A committee set up by the Securities and Exchange Board of India (Sebi) has made these recommendations, and the regulator’s board meeting on 28 December approved them, minutes of the meeting published on the Sebi website on Monday showed.“The offer of Security Receipts (SRs), which are proposed to be listed, may be allowed only to Qualified Buyers through private placement,” the minutes read. Initially, security receipts—issued by ARCs to banks in exchange for some of thei...

Labour Ministry looks to add self-employed to job data Employment numbers could increase significantly if a labour ministry proposal to include self-employed people under the Pradhan Mantri Mudra Yojana (PMMY) in the data is implemented. That would give the government's job-creation credentials a boost ahead of the 2019 general election. This proposal comes as a spat has been brewing over a recent report that said 5.5 million people will be added to the Employees' Provident Fund Organisation (EPFO) network in the current fiscal, reflecting employment growth. Critics have said EPFO enrollment doesn't necessarily mean job creation. The PMMY initiative is separate from this and will be the first attempt to capture the number of self-employed people in the country's job data. It is expected to add more than 50 million people to India's existing workforce of nearly 500 million, a senior government official told ET on the condition of anonymity. Out of India...