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Sebi could make 'pre-trade' allocation mandatory in Indian markets Pooled investors such as MFs or FPIs will have to state schemes under which they are acquiring shares The Securities and Exchange Board of India (Sebi) will soon issue a set of rules for trade allocations of institutional investors such as mutual funds (MFs) or foreign portfolio investors (FPIs). Sources say Sebi could make ‘pre-trade’ allocation mandatory. Currently, pooled investors, including MFs and FPIs, are allowed to buy blocks of shares from the market without assigning these to a specific scheme. Under the new framework, funds will have to determine beforehand how much of the purchased shares would go into each scheme. The move comes after several MFs were reportedly allotting shares to their schemes on an arbitrary basis, often giving preference to flagship schemes. There is no uniform framework for allotment of shares to schemes. Some institutions currently apply scheme-wise for allocations

GST Council Meet on May 4, Simplifying Returns on Agenda Finance Minister Arun Jaitley-chaired GST Council will meet on May 4 to discuss a simpler return form and the amendments required in the indirect tax regime rules. The 27th meeting of the Council, comprising state finance ministers, will meet through video conferencing and will also mull over the proposal of converting GSTN into a government company. A decision on return simplification could be on the cards with the Sushil Modi-led Group of Ministers putting before the Council the three models of new return form for discussion, an official said. With Jaitley been advised by doctors to stay in isolation to avoid contracting infection, the meeting has been planned through video conferencing. The Council had in March discussed on two models of GST returns and suggested that the GoM would work further simplification. The Economic Times, New Delhi, 26th April 2018

  E-commerce policy in six months; to tackle data privacy and tax issues On the issue of a potential regulator for the sector, the Commerce Secretary said it would depend on whether the policy needed legislative requirements and new regulations or existing laws sufficed The government has announced that a framework for an e-commerce policy will be prepared within the next six months. The comprehensive policy is expected to focus on all aspects of the e-commerce business and consumers. It will encompass data privacy and taxation, apart from a host of technical aspects such as technology transfer, server localisation and connectivity issues. Commerce Secretary Rita Teaotia said on Tuesday that a large number of ministries, key industry players and several regulators, including the Competition Commission of India and the Telecom Regulatory Authority of India, would be involved in drafting the policy. The think tank tasked with drafting the policy held its first meeting on Tuesday.

Draft Rules Framed on Capital Gains Tax Where STT Not Paid Bonus shares, policy compliant foreign investment eligible for 10% tax even though STT not paid The income tax department has put out draft rules specifying situations where the recently imposed capital gains tax would apply even though no securities transactions tax (STT) has been paid. Bonus shares, policy compliant foreign investment, shares acquired via a will or inheritance, court or regulator approved acquisition, shares acquired under insolvency resolution and those under government disinvestment among others would be eligible for the new capital gains tax regime even though STT is not paid. The department has sought comments on the draft rules that recognise genuine transactions where STT could not have been paid. Once these rules are in force, these transactions would be eligible for tax at the rate of 10% even though there is no STT paid. Otherwise, such gains can face higher tax if clubbed with income. The

I ndia may Face Pressure to Cut Duties on 90% of Goods Traded with China India is likely to face greater pressure to eliminate duties on 90% of goods it trades with China under the mega trade agreement among 16 Asia Pacific countries that is in the works. Officials said that China, which has till now not aggressively pushed to fast track negotiations in the Regional Comprehensive Economic Partnership (RCEP), has shown a new keenness to “engage actively” ahead of the next round of talks later this week, the first after it its trade standoff with the US. The talks are scheduled for April 28- May 8 in Singapore. “The current situation can influence our negotiations. China looks keen to engage actively,” said a government official. Beijing’s sudden interest in the closure of the RCEP is fuelled by Washington’s renewed interest in the Trans-Pacific Partnership (TPP) agreement, another mega regional trade partnership. Incidentally, seven countries-Australia, Brunei, Japan, Malaysia

LTCG tax: No STT likely on employee stock options plans, inherited shares Listed shares received through family succession or will of the deceased and acquired till January 31 will not attract STT The income-tax (IT) department has proposed to exempt employee stock options plans (ESOPs) given till January 31, 2018, from the securities transaction tax (STT), while availing the benefits of grandfathering and threshold exemption in long-term capital gains (LTCG) tax at 10 per cent. Also, listed shares received through family succession or will of the deceased and acquired till January 31 will not attract STT. The department has sought comments on these proposals by April 30. There have been queries on whether the 10 per cent LTCG tax will be applicable if STT was not paid at the time of acquiring certain off-market transactions or whether these assessees will have to pay LTCG tax under different provisions where certain concessions were not available. The new tax is imposed un

Trading through mobile app may need eye sacn :SEBI With the aim to enhance cyber security, market regulator SEBI is looking to put in place a new set of guidelines, wherein fingerprint or eye-scan will be required for stock trading through mobile applications. The market watchdog has sought comments from the market participants such as brokers, traders and stock exchanges in this regard, and a final regulation will be put in place after taking into account views of all the stakeholders, regulatory sources said. In case of applications installed on smartphones and tablets, traders and retail investors may need biometric authentication to buy and sell stocks, according to the SEBI proposal. The Business Line, New Delhi, 24th April 2018