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FM asks states to cut VAT on petro products

FM asks states to cut VAT on petro products Finance Minister Arun Jaitley has written to all Chief Ministers urging them to reduce Value Added Tax (VAT) on petroleum products used in the manufacture of goods as the current system was leading to cascading of taxes on such goods under the Goods and Services Tax (GST) regime. Currently, crude oil, natural gas, petrol, diesel and aviation turbine fuel are out of GST purview. All other petroleum products fall under the new indirect tax. “The letter by Finance Minister highlights a concern being raised by the manufacturing sector in the country regarding the rise in input costs of petroleum products happening on account of transition to Goods and Services Tax regime,” the Finance Ministry said. “In the post-GST scenario, manufactured goods attract GST while inputs of petroleum products used in the manufacturing attract VAT and, therefore, it would lead to cascading of taxes.” “These products are a principal source of revenue for the states, so …

‘There’s No Inconsistency in Data on Taxpayers’

‘There’s No Inconsistency in Data on Taxpayers’ The Central Board of Direct Taxes has said number of individuals filing income tax returns jumped to 2.79 crore this year from 2.23 crore, an increase of 56 lakh as stated by Prime  Minister Narendra Modi in his Independence Day speech. The apex direct taxes body said there is no inconsistency in the data. The statement comes after doubts were raised in some quarters over the data given out by government at different points in time. “It is clarified that there is no inconsistency in the data provided by the government in the statements referred to above as these are in different contexts and for different time periods,” a CBDT statement said on Friday. The Prime Minister's speech (on August 15) referred to the increase in number of e-filed Personal Income Tax Returns (ITRs) filed from April 1, 2017 to August 5, 2017 over the ITRs filed in corresponding period of earlier years. “The data maintained by the Income Tax Department shows that…

P-note investors return to Mauritius as FPIs

P-note investors return to Mauritius as FPIs Even as participatory notes (P-notes) become unattractive for taking positions, many investors are now looking to enter India using the foreign portfolio investment (FPI) route either through Mauritius or directly.  P-notes are overseas derivative instruments with Indian stocks as their underlying assets. Industry trackers say some P-note holders are looking to directly invest in India without setting up an investment arm in a buffer country .However, some of the other investors could route their investments through Mauritius.  The persons cited earlier said the newly registered FPIs will fall under category-III definition of the government and could start attracting higher taxes, going ahead.  Many P-note holders invest in In dian futures and options (F&O) on which they did not pay any tax until recently. Also the instrument provided anonymity to these investors. However, the market regulator recently took two steps that forced investors o…

RBI identifies 40 more large loan defaulter accounts for clean-up

RBI identifies 40 more large loan defaulter accounts for clean-up Along with the 12 cases where bankruptcy proceedings have already started, these would account for 60-65% of the bad loans clogging the banking system The Reserve Bank of India (RBI) has identified 40 large defaulters as the next lot of firms where banks will push for an early resolution, a government official said on condition of anonymity.  Along with the 12 cases where bankruptcy proceedings have already started, these would account for 60-65% of the bad loans clogging the banking system, this person added.  An RBI spokesperson declined comment. A speedy resolution of these cases “will keep the banking system running”, the government official said. He added that invoking the Insolvency and Bankruptcy Code won’t be the default option for resolving these accounts and lenders will also look at other mechanisms such as joint lenders’ forums. Indian banks are sitting on a stressed asset pile of more than Rs10 trillion, of which…

Filing a revised tax return is quite easy

Filing a revised tax return is quite easy The revision has to be done before the prescribed deadline or before completion of assessment, whichever is earlier If you are one of the last-minute filers of income-tax returns, it is quite possible that mistakes have crept in some computation or other. For instance, you might have incurred capital losses but haven’t offset it against capital gains or there could be some additional income, such as bank interest income which you have forgotten to show. In such cases, despite the final deadline of August 5 being over, you have the option to file a revised return. After you have filed your return, the Central Processing Centre (CPC) in Bengaluru carries out electronic processing of returns. It then issues an intimation which could convey the demand due, refund payable, or it may simply say that nothing more is required. “In recent times, the scope of matters that the CPC can look into has been widened. For instance, in case of any discrepancy betw…

Black money drive: Govt to weed out dormant LLPs

Black money drive: Govt to weed out dormant LLPs After cracking its whip on suspected shell companies, the government has turned its focus on the growing number of Limited Liability Partnership (LLPs) firms. In suchapartnership, partners can´t be held liable for another´s misconduct or negligence. As a first step, the government is in the process of identifying and deregistering inactive LLP firms. “The Registrar of Companies (RoC) is onaspree to strike off inactive LLPs from its register,” says Vikas Gupta, partner, Nangia &Co. The government has been onadrive against generation of black money and money laundering through use of shell companies. In his Independence Day speech, Prime Minister Narendra Modi said that the government had identified over 300,000 shell companies and registrations of 175,000 such firms had been cancelled. Experts point out, just like shell companies, inactive LLPs could be used for tax evasion and money laundering. The trend of converting existing companies int…

Insolvency regulator empowers property buyers, puts the monapar with creditors

Insolvency regulator empowers property buyers, puts the monapar with creditors The insolvency regulator has brought inaspecial provision to protect the homebuyers of beleaguered real estate companies such as Jaypee Infratech and Amrapali. The Insolvency and Bankruptcy Board of India (IBBI), which is implementing the Insolvency and Bankruptcy Code, has said owner of undelivered properties can become part of the committee of creditors and stakeaclaim equivalent to the amount they have paid to realtors Their claims, according to the regulator, would be treated onapar with claims of other financial and operational creditors and would not be pushed to the bottom of the list. Homebuyers can now file form ´F´, introduced by the insolvency regulator, for claims. “Such entities should submit proof of their claims to the interim resolution professional or resolution professional,”anotification issued by the IBBI on Wednesday said. This section of homebuyers, however, would not be able to take any re…