Taxation
Excise, VAT exempted goods by states should be GST exempt: FICCI
India Inc. proposed on Tuesday that goods fully exempted from excise duty and VAT by states be categorised as exempted goods in the GST regime, which should be implemented after a minimum of 6 months from the date of adoption of the GST law by the GST Council.
 
"Goods fully exempted from the levy of excise duty and VAT by all the states be categorised as exempted goods in the GST regime as well," Federation of Indian Chambers of Commerce and Industry (FICCI) said in a release following a meeting here with the Empowered Committee of State Finance Ministers on the Goods and Services Tax.
 
"Goods chargeable to nil rate of excise duty but charged to VAT in most states could be identified for levying a merit rate of GST. All other goods (except jewellery and demerit goods) could be subjected to the standard rate," the statement said.
 
"As per current indications and reports, goods will be categorised as being subject to merit rates (12%), standard rates (18%) and de-merit rates (40%).
 
"Certain goods will be exempt from GST while bullion and jewellery would be charged to 1% / 2%," FICCI added regarding classification of goods for applying GST rates.
 
In this connection, the industry chamber suggested that with a view to check inflation and check the tendency to evade taxes "the merit rate should be lower and the standard rate should be reasonable."
 
On implementing GST, FICCI said that in order to provide adequate time to trade and industry to prepare "for a hassle free roll out of the GST regime", a minimum of 6 months time should be permitted from the date of the adoption of the GST Law by the GST Council.
 
"Additional time would be required in case the GST Law as passed by parliament or state legislatures is significantly different from the one adopted by the GST Council," FICCI said.
 
FICCI also requested the empowered committee that certain existing exemptions such as the area based exemptions under excise legislation and incentives under states' industrial policies should be converted into an effective, non-discretionary tax refund mechanism.
 
The industry body further recommended that valuation provisions under GST, which is a transaction based tax, should give primacy to actual transaction value.
 
"Valuation provisions under the draft GST laws are reflection of valuation laws of a single point tax like excise duty. Wide powers have been given under the draft GST laws to authorities to reject declared transaction value," the statement said.
 
In a meeting here with Revenue Secretary Hasmukh Adhia earlier this month, Indian industry chambers had raised concerns on the draft GST law, flagging issues like dual administrative control and wide discretionary powers for tax authorities.
 
"Provisions may lead to unwarranted disputes in future so it requested to give a re-look the law before finalising," a FICCI representative told reporters here after the meeting.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

 

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Nifty, Sensex breaks out of its trading range – Tuesday closing report
We had mentioned in Monday’s closing report that Sensex, Nifty might be range-bound. The major indices of the Indian stock markets rallied strongly on Tuesday and broke out of their one-month trading range. The gains were a substantial 1.5% at the end of the day’s trading. We expect the upward momentum to continue.
 
 
The markets were buoyed on strong buying support across sectors, coupled with positive global cues during the mid-afternoon session on Tuesday. Healthy buying was witnessed in automobile, banking and healthcare stocks. The BSE market breadth was skewed in favour of the bulls -- with 1,631 advances and 1,081 declines. On the NSE, on Tuesday, there were 891 advances, 491 declines and 81 unchanged.
 
The US dollar traded mixed against other major currencies as investors were digesting the recent remarks by Federal Reserve Janet Yellen and newly-released economic data from the country. "In light of the continued solid performance of the labour market and our outlook for economic activity and inflation, I believe the case for an increase in the federal funds rate has strengthened in recent months," Yellen addressed central bankers at a conference in Jackson Hole, Wyoming, on Friday. Pointing to solid growth in household spending and a strengthening job market, Yellen said the US economy is "now nearing" the Fed's statutory goals of maximum employment and price stability. Analysts said it's possible for the Fed to hike interest rates as soon as September. But about 71% of 62 economists surveyed by the Wall Street Journal this month believed the Fed will wait until December to raise rates. 
 
The government in India on Tuesday announced to issue the fifth tranche of Sovereign Gold Bonds, the subscription of which will be open from September 1-9. "The government, in consultation with the Reserve Bank of India (RBI), has decided to issue fifth tranche of Sovereign Gold Bonds. Applications for the bonds will be accepted from September 1, 2016 to September 9, 2016," the Finance Ministry said in a statement. The Bonds will be issued on September 23.  The Sovereign Gold Bond, a financial asset, was launched by the government last year as an alternative to purchasing the metal gold. Accordingly, four tranches of issuances have been undertaken during 2015-16 and 2016-17 so far.
 
Japan's unemployment rate dropped to 3% in July marking the lowest level in 21 years, the government announced on Tuesday. According to the Ministry of Internal Affairs and Communications, the unemployment rate on a seasonally adjusted basis was 3 per cent in July, with the number of employed persons in the recording month totalling to 64.79 million, an increase of 980,000 or 1.5% from the previous year. The number of unemployed persons in July, meanwhile, was 2.03 million, the ministry said, which is a decrease of 190,000 or 8.6% from the previous year. The job availability in Japan held steady in July at 1.37, which means that there were 137 positions available for every 100 people looking for work. 
 
State-run oil marketer Indian Oil Corp. (IOC) on Monday declared a 25% rise in net profit for the first quarter ended June at Rs8,268.98 crore, compared to Rs6,590.83 crore in the same quarter in the previous year. Total income in the June quarter fell because of a drop in global oil prices and was at Rs1,07,200 crore, registering a fall of 5.75%, as compared to Rs1,13,743 crore in the same period last year. Average gross refining margins, on turning every barrel of crude oil into fuel, for the June quarter was $9.98 per barrel as against $10.77 in June quarter of 2015. The company also declared bonus shares in the ratio of 1:1, that is, one equity bonus share of Rs10 each for every existing equity share of Rs10 each fully paid up, subject to the approval of the shareholders. Earnings per share rose to Rs34.90 during the quarter in question, as compared to Rs27.81 in the same quarter last year. The company’s shares closed at Rs574.10, up 0.38% on the BSE.
 
The top gainers and top losers of the major indices are given in the table below:
 
 
The closing values of the major Asian indices are given in the table below:
 

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Land acquisition protests gain momentum in Jharkhand
Protests against land acquisition for industries are gaining momentum in Jharkhand and a police firing in Ramgarh has fuelled it further.
 
Former Chief Minister Babulal Marandi on Tuesday started a two-day mass fast at Hazaribagh district against land acquisition by National Thermal Power Corporation (NTPC).
 
On Monday, police had opened fire on villagers demanding compensation for land acquired by Innland Power Limited (IPL). Two people were killed and more than 20 belonging to either sides were injured. 
 
The displaced people were earlier called for talks at IPL factory which the management did not attend.
 
This angered the villagers who started protesting that resulted in police firing later on. 
 
According to opposition parties the land rate compensation given to villagers this time are much less than the 2013 land acquisition provisions.
 
Jharkhand is facing these protest at various places. In Hazaribagh the villagers are protesting against the NTPC, while in Barkagao for coal mines. 
 
NTPC was awarded coal blocks for thermal power plant at Barkagao in 2010 but mining could not start due to protest.
 
The opposition had put the state government on mat during the budget session in February for low compensation of land in Santhal Pargana region. They had alleged that the price was reduced to ensure land to Adani power plant at low rate.
 
Following which a committee was formed to look into the land rates of Santhal Pargana. 
 
The fresh row over land acquisition began when Jharkhand tried to make changes in two land acts -- Chotanagpur Tenancy Act (CTA)and Santhal Pargana Act (SPT). 
 
Even alliance partner of the ruling Bharatiya Janata Party joined the opposition as the changes could lead to land acquisition for non agricultural purposes like power plants, roads, malls and other things. 
 
Former central Minister and Congress leader Subodhkanat Sahay told IANS: "Jharkhand is suffering from land acquisition problem." 
 
Echoing his view former Chief Minister and Jharkhand Mukti Morcha (JMM) Executive President Hemant Soren told IANS: " The killing of people indicates the ruthless and insensitive approach of the Raghubar Das government." 
 
The opposition has also alleged that the state has proposed to form land banks which would lead to vacating of people living on government land.
 
The protest against NTPC had gained momentum in July when opposition leaders went to Barkagao to extend support. NTPC lodged FIR against them for entering the mining area. On August 4, the opposition even courted arrest.
 
Chief Minister Raghubar Das had assured the villagers earlier this month that agriculture land would not be acquired forcefully.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

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