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Finance Minister Arun Jaitley on Tuesday hinted that tax rates might be brought down as demonetisation is likely to bring in higher tax revenues from unaccounted wealth. In a statement released to the media, Jaitley said that a substantial quantum of future transactions would be digital as India moves towards a less-cash society. “Once they are substantially digital, they get caught in tax net. Therefore, the future taxation level would be much higher than what is currently being collected. This would also enable the government at some stage to make taxes more reasonable, which will apply to both direct and indirect taxes,” he said. The statement came roughly one-and-a-half months before the Budget 2017-17, which is expected to be tabled in Parliament on February 1. While Jaitley did not refer to the Budget, it is widely expected that the central government might announce a number of direct tax sops for individuals as well as the corporate sector in the Union Budget for 2017-18

A government panel on digital payments has recommended an independent payments regulator within the framework of the Reserve Bank of India (RBI) and similar treatment for banks and non-banking entities in the payments space. It has also suggested strengthening existing laws to protect consumers and their privacy. The panel, headed by former finance secretary Ratan Watal, was constituted in August to suggest ways to encourage India’s movement towards a cashless economy. Mint New Delhi,14th December 2016

Facing a ‘serious’ manpower crunch to investigate fraudulent and ‘serious irregularities’ on account of demonetisation, Central Board of Direct Taxes (CBDT) chairman Sushil Chandra has in an internal letter sought to rope in income tax inspectors to assist the investigation team. In the letter, reviewed by Business Standard ,addressed to all principal chief commissioners, Chandra has highlighted that the investigation team was ‘seriously handicapped’ due to manpower shortage. “Investigation Directorates have intensified enforcement actions in detecting serious irregularities. They are, however, seriously handicapped because of non-availability of manpower,” the CBDT chief said in the letter. He added that the current investigation and enforcement drive was likely to continue in the coming weeks. Chandra recommended reorganisation of work by the field formations, which could spare a few officers for investigation. He asked the principal chief commissioners to identify such off

The Employees' Provident Fund Organisation (EPFO) is likely to take a decision on the rate of intrest on PF deposits for 2016-17 financial year in its trustees meet on Monday. Sources said  the intrest rate could be at least 8.8 percent which was fixed for the last financial year. Business Standard New Delhi,14th December 2016

The government is set to miss the deadline for tabling supporting legislation for the goods and services (GST) tax in the ongoing winter session of Parliament after the GST council on Sunday failed to finalize the draft laws. This in turn puts the government’s 1 April deadline of rolling out GST under a cloud. The government wanted to table three draft laws—the central GST bill (CGST), the integrated GST bill (IGST) and the bill for compensating states for revenue losses following the implementation of GST (SGST)—in the winter session ending on 16 December. But these bills are now likely to be tabled only in the budget session, due to begin in January, as the GST council failed to reach a consensus on any of the bills. State legislatures also have to pass the state GST bill before the tax can be rolled out, making it even more difficult for the government to push through GST implementation from the beginning of the next fiscal year. Finance minister Arun Jaitley reiterated th

Revenue Department today said officials will not reopen the past assessments of excise and service tax of assessees even if their turnover in the current period increases on account of digital payments in the wake of demonetisation. In a circular to excise and service tax chief commissioners, the Central Board of Excise and Customs (CBEC) said there are "apprehensions" that an increased turnover because of use of digital modes of payment may lead to demands for the earlier period. "It is, hereby, clarified that in indirect taxes, past assessments will not be reopened for this reason alone," the CBEC said. Ever since the demonetisation announcement on November 8, in order to curb generation of black money the government has been taking steps to encourage people to shift towards digital mode of payment while making financial transactions. "By adopting a digital mode of payment, no financial transaction would remain undisclosed and consequently an enhanc

It is virtually a race against time for India Inc as the April 1 deadline for the Goods and Services (GST) Tax rollout stares at them. While companies have appointed consultants to advise them on GST, nothing much has moved beyond that especially with small and medium enterprises. Large companies, however, say they can meet the April 1 deadline. Conversations with multiple tax experts reveal that not more than 40-50 per cent of large companies are ready for a GST rollout on April 1. “Manufacturing companies in categories such as consumer goods, auto, auto ancillaries etc were conscious of GST early on and did begin their groundwork in time. But, the services sector such as banking, insurance, media and entertainment are not quite ready for an April 1 rollout,” says Sachin Menon, partner and head of indirect tax at KPMG.  Retail majors such as Future Group and Shoppers Stop say that they have kicked off the process of being GST-compliant and can meet the April 1 deadline. Nihal