Fiscal Policy 05 Dec 2017 by Tojo Jose

GST revenue trends: Centre on the edge

GST revenue trends: Centre on the edge

The first four months’ GST revenue brings puts the central government on knife-edge as the revenue realization trend goes close with the actuals received during the previous years. According to data released by the tax department, GST revenue for the first four months grossed at Rs 361496 crores. Half of this receipts should go to states. GST collections in the maiden month of July was over Rs 95,000 crore while in August, the figure was around Rs 91,000 crore. During September, the revenue crossed Rs 92,150 crore and for October it slipped nearly 10 per cent to Rs 83,346 crore. For the centre, if the GST receipts should cross the previous year’s union excise duties e

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Fiscal Policy 28 Nov 2017 by Tojo Jose

NK Singh appointed as the Chairman of the 15th Finance Commission

NK Singh appointed as the Chairman of the 15th Finance Commission

Fiscal expert cum bureaucrat, NK Singh was appointed as the Chairman of the 15th Finance Commission. Mr Singh who served as Expenditure and Revenue Secretary, was the Chairman of the FRBM Review Committee that made a remarkable and scholarly study of fiscal prudence practices in the country.   As per initial reports, the Commission will have two special terms of references- on making impact assessment of GST and review fiscal consolidation efforts. The 15th FC is appointed in the context of the changed federal financial relationship authored by the existing award. States are getting nearly 62% of the central taxes as tax share and grant and most of the previously run central

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Fiscal Policy 21 Nov 2017 by Tojo Jose

Centre mobilises Rs 14500 crores from Bharat 22

Centre mobilises Rs 14500 crores from Bharat 22

The Central government’s Exchange Traded Fund (ETF) disinvestment project - Bharat 22 has mopped up Rs 14500. Indicating the investors’ interest, the ETF has subscribed four times. According to market data, Bharat 22 got the highest investors demand for any new ETF offer in India’s mutual fund history. Participation from all categories of investors, including the retail investors crossed the subscription volume. Bharat 22 is an ETF (Exchange Traded Fund), launched by the government, containing shares of 22 companies including Central Public-Sector Enterprises (CPSEs), Public Sector Banks and shares of some private companies owned by government investment ar

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Fiscal Policy 13 Nov 2017 by Tojo Jose

Jaitley acknowledges scope for GST rate rationalization

Jaitley acknowledges scope for GST rate rationalization

Just two days after modifying the GST rates of nearly 200 items, Finance Minister Arun Jaitley acknowledged that there is scope for more fine-tuning of the new taxes’ rate structure. Revenue buoyancy will be the factor deciding the course of such rationalization. At the same time, he has ruled out the extreme case of following a single tax rate. “Those seeking a single GST rate have no understanding of tariff structure,” the Finance Minister has hinted at the Congress demand for the single 18% rate. At present, the GST rate structure has four rates besides the few low rates on gold and other items. Tax experts and administrators warns about the risk of going

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Fiscal Policy 11 Nov 2017 by Tojo Jose

GST Council go for major realignment: makes rate reduction on popular items

GST Council go for major realignment: makes rate reduction on popular items

Nearly four months after the launch, the GST Council has slashed rates for more than 200 items including goods and services. Rates of all several popular items like wire, cables, furniture etc., will come down from the 28% rate. GST Council that met for the 23rd time, decided to make serious rate changes besides enhancing the composition scheme for Small and Medium Enterprises.  The annual turnover limit to be eligible for the composition scheme is now Rs 1.5 crores. The change has left just 50 items under the high tax rate of 28%. The new tax rates also give relief to the hotel industry where the new tax rates for low tier hotels is set at 5%. The GST has a four-tier struc

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Fiscal Policy 08 Nov 2017 by Tojo Jose

Multi-agency group to study Paradise Papers revelations

Multi-agency group to study Paradise Papers revelations

The Central Board of Direct Taxes has formed a multiagency group to look into the Paradise Papers revelations related to Indian residents. The group will be headed by the CBDT Chairman and include members of major financial investigation entities – the Enforcement Directorate, Financial Intelligence Unit and the officials from the RBI. The Paradise Papers are financial documents related to overseas money and income transactions of residents from various countries. Most of the accounts are accused to illegal and related to black money transactions. But experts point out that some of them might have been fair transactions to facilitate complex financial arrangements. Accor

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Fiscal Policy 25 Oct 2017 by Tojo Jose

Govt unveils Rs 7 lakh crores stimulus package; funded by Rs 3.44 lakh crore borrowings

Govt unveils Rs 7 lakh crores stimulus package; funded by Rs 3.44 lakh crore borrowings

The Government has brought out Rs 7.46 lakh crore stimulus to overcome the current economic slowdown. Two critical sectors – highways and public-sector banks will share the stimulus. Announcing the programme, Finance Minister Arun Jaitley said that the stimulus will be completed in the next two years. First beneficiary of stimulus are the PSBs, who will be recapitalized by Rs 2.11 lakh crore. The major portion of the stimulus goes to the road sector as the proposed Bharatmala Pariyojana will be funded with Rs 5.35 lakh crores. Bharatmala’s main thrust is to construct a coastal highway of nearly 34800 km. Funding of the programme The funding of the programme is cru

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Fiscal Policy 08 Aug 2017 by Tojo Jose

Tax filings and advance tax payments goes up on demonetisation impact

Tax filings and advance tax payments goes up on demonetisation impact

Trends on tax filings indicate they have gone up significantly during the post-demonetisation. While the tax filings increased by nearly 25%, advance tax payments increased by a whopping 42%. According to the Ministry Finance estimate, the number of income tax returns filing increased by nearly 25 % this fiscal. The ITR filing increased by 24.7% pushing the total return filings to 2.82 crores from 2.26 crores during the corresponding period in 2016-17. The number of filings by individuals reached 2.79 crores, registering an increase of 2.22 crores. “As a result of demonetisation and ‘Operation Clean Money,’ there is a substantial increase in the number of Income

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Fiscal Policy 05 Jul 2017 by Tojo Jose

Government warns companies on profiteering while making price adjustment with GST

Government warns companies on profiteering while making price adjustment with GST

Government today warned the retailors and manufactures against any profiteering during the GST transition phase. Companies should reduce the price for goods where the GST rates have come down. Only goods that ware manufactured before July 1 can be sold at the GST impacted higher price according to the Revenue Secretary Hasmukh Adhia. Profiteering means retailors are not transferrin the reduced tax in the form of a reduced price to the consumers. Manipulation of prices on stocks is the route for profiteering. Government has decided to create an anti-profiteering authority during the transitional period. A five-member National Anti-Profiteering Authority, headed by a secretary-level

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Fiscal Policy 03 Jul 2017 by Tojo Jose

GST’s customization: India’s own version may test businesses’ adaptability

GST’s customization: India’s own version may test businesses’ adaptability

The GST is considered to be the ultimate tax reform in indirect taxes globally. Several countries have adopted it and those who have unitary financial structure or where there is only one central government, GST launch is rather simple. But in India’s case, the situation is much different. Merging of central and state taxes needed constitutional arrangements and political consensus. Indian conditions are also much different with the business communities consists of largely small and medium enterprises that have several hurdles to establish and manage the GST infrastructure. It doesn’t mean GST is a higher order reform given the capability of the business community. Ra

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