Tag: GST

Farmers ask Govt to roll back 5% GST on raw tobacco

13/06/2017 15:46

A farmers’ association has asked the government to roll back 5 per cent GST on raw tobacco and exempt it from the tax bracket like any other agricultural crop, reported PTI.

Fearing drop in prices of tobacco leaves and raw tobacco post GST, tobacco farmers across Andhra Pradesh have stalled auctions in all platforms, said the Federation of All India Farmer Associations (FAIFA) in a statement.

Terming the tax rate on tobacco “unrealistic”, farmers said it will severely endanger their livelihoods and asked the government to do away with it in the upcoming GST-Review meeting on June 18.

“Farmers from different auction platforms in the Southern Black Soil (SBS) region decided not to bring our produce to the market to protest 5 per cent GST on tobacco leaves and 28 per cent on unmanufactured tobacco,” said FAIFA Vice President Gadde Seshagiri Rao.

According to FAIFA, raw tobacco and un-manufactured tobacco were exempted from the central excise from the time of Charan Singh government considering their difficulties.

The association has requested to “maintain status quo” in this regard by treating tobacco “on par with other agricultural crops”.

FAIFA claims to represent farmers of commercial crops from Andhra Pradesh, Telangana, Karnataka, Gujarat etc.

7 states yet to pass GST laws even as rollout deadline nears

7 states yet to pass GST laws even as rollout deadline nears

06/06/2017 11:00

With less than a month left for GST rollout, seven states, including West Bengal, Tamil Nadu and Jammu & Kashmir, are yet to pass their legislations required for implementing the new indirect tax regime, said an official statement.

So far, 24 states and Union Territories, including Delhi, Odisha and Puducherry, have passed the State Goods and Services Tax (SGST) Act in their respective legislative assemblies.

However, seven states — Meghalaya, Punjab, Tamil Nadu, Kerala, Karnataka, Jammu & Kashmir and West Bengal — are yet to pass the SGST law. Baring Jammu & Kashmir where BJP is an alliance partner of PDP, all are non-BJP ruled states.

The government plans to roll out the Goods and Services Tax (GST), which will subsume 16 different taxes, from July 1. West Bengal wants the Centre to delay roll out of the GST by a month and the issue was raised by state Finance Minister Amit Mitra at the meeting of the GST Council last week.

Mitra said that implementation of the GST from July 1 will have “serious problems” as the IT infrastructure required to manage GST’s returns and invoice uploading are not in place”.

So far, GSTN has been able to do test drive on 200-300 companies in each state. Forms and rules have been changed in May.

The Union Finance Minister has to decide whether it should go ahead with the biggest fiscal reform when the IT preparedness is not 100 per cent,” Mitra said.

As per the GST Constitutional amendment, all states have to pass SGST bills by September 15, 2017, failing which they will lose their taxation powers.

Tax burden on gold should reduce under GST regime: WGC

Tax burden on gold should reduce under GST regime: WGC

25/05/2017 17:17

The World Gold Council today urged the government to reduce the tax incidence on gold and gold products under the new Goods and Sevices Tax regime.

“In the GST regime, we urge and expect that the total tax burden on gold be halved from the current level of around 12 per cent,” WGC managing director Somasundaram PR said here today during launch of a new comprehensive India gold report in Bengali.

The report is published after 15 years and is also available in English, Hindi, Malayam and Tamil for a ready reference to Indian gold industry.

Currently, total taxation comes to between 12 and 13 per cent. Custom duty is 10 per cent, excise is one per cent and VAT of 1-1.5 per cent depending upon states.

“In the GST regime, we demand the total tax burden on gold to be not more than 6-7 per cent. But, we have to wait for a few days more when the GST rates on gold is expected to be announced,” Somasundaram said.

He tried to convince that gold import was not as bad as was perceived to be when asked why government should offer low tax on gold which is an idle asset and contribute a lot for current account deficit.

“According to a 2014-15 report of PWC, value addition in gold is to the tune of USD 30 billion with a lot more scope. Gold loan is also to the tune of around USD 10 billion with about 1,250 tonne as collateral allowing persons access to credit be it formal or informal,” Somasundaram said.

Hoping GST will bring lot of transperency in the gold industry including check on illgeal imports which is about 120 tonnes a year now. But it will take few months industry to get stabilised, the WGC official said.

Somasundaram said government should promote gold investment through ETF with tax breaks rather than physical gold.

He reteriated that the country needed a gold policy that would help all stakeholders.

Meanwhile, the gold demand during Q1 (January-March, 2017) grew by 15 per cent to 123 tonnes, but it was 18 per cent down compared to the corresponding period in the last five years on average.

GST execution from July 1 a challenge for industry: Assocham

GST execution from July 1 a challenge for industry: Assocham

24/05/2017 16:34

Implementing GST from July 1 will be a challenge for the industry and the government should consider relaxing penal provisions for a couple of quarters to help it comply with the new tax regime, Assocham said today.

The government is working overtime to roll out the goods and services tax regime from July 1 and has held several workshops and seminars to familiarise traders and the industry about the new indirect taxation structure.

“Implementing GST from July 1 will definitely be a challenge for the industry… There could be people making genuine mistakes. I would say the department should be softer in the first quarter or two because it is going to be a learning process,” Assocham President Sandeep Jajodia told PTI in an interview.

He sought relaxation on imposition of penal provisions for at least a quarter or two, if not the whole year.

The GST law provides for as many as 21 kinds of penalties for various offences. Short payment will attract a penalty of 10 per cent of the tax due subject to a minimum of Rs 10,000. For various other errors, the penalty would be 10 per cent of the tax due.

On the impact of GST on the steel sector, Jajodia, also the CMD of Monnet Ispat and Energy Limited, said: “I don’t think there will be much (difference). There are no negatives at all for sure and there could be some positives because the raw material pricing, ores and coal have come down.”

However, the Assocham president said GST will provide a huge fillip to the industry in the medium to long term as the tax compliance at present is “quite tedious”.

Centre to get greater chunk in residual GST compensation fund

27/03/2017 15:31

The Centre will have a greater share of the residual amount in the compensation fund at the end of the 5-year period as the GST Bill now provides for equal sharing of the amount as against the earlier formula which favoured states, reported PTI.

According to the Goods and Services Tax (Compensation to States) Bill, as introduced in the Lok Sabha, they will receive provisional compensation bi-monthly from the Centre for loss of revenue from implementation of GST. The draft law had provided for payment of compensation every quarter.

Tweaking the provision of the draft, which was made public in November 2016, the GST Compensation Bill said that “any residual amount left in the Compensation Fund after five year compensation period shall be shared equally between the centre and the states”.

As per the earlier draft, any excess amount after the end of five year tenure in the ‘GST Compensation Fund’ were to be divided between Centre and states as per the specified formula under which 50 per cent of the excess amount was to be devolved between Centre and States as per statute.

The remaining 50 per cent would have to be given to the states in the ratio of their total revenues from SGST in the last year of the transition period.

The bill, as cleared by the GST Council, has simplified the structure for sharing of the residual amount in the Compensation Fund.

The GST Council, comprising Union Finance Minister and state representatives, had decided to set up a compensation fund by levying cess on demerit and luxury goods. The proceeds from the fund would be utilised to compensate the states for revenue loss in the initial five years of GST roll out, which is likely from July 1.

The bill also provides for audit of accounts relating to Compensation Fund by the Comptroller and Auditor General. Also the final adjustment of compensation to be paid to the states would be done after audit of accounts of the year by the CAG.

The Bill also stipulates that the base year for calculating the revenue of a state would be 2015-16 and a secular growth rate of 14 per cent would be used for calculating the revenue of each state in the first five years of implementation of GST.

The loss of revenue to a state will be the difference between the actual realisation to a state under Goods and Services Tax (GST) regime and the tax revenue it would have got under the old indirect tax regime after considering a 14 per cent increase over the base year of 2015-16.

It also provides that in case of the 11 special category states, the revenue foregone on account of exemption of taxes granted by states shall be counted towards the definition of revenue for the base year 2015-16.

The revenues of states that were not credited to the Consolidated Fund of the states but were directly devolved to “mandi” or “municipalities” would also be included in the definition of ‘revenue subsumed’, the bill said.

Rupee nosedives 23 paise against US dollar

27/12/2016 12:20

The Indian rupee tumbled 23 paise against its US counterpart on Tuesday amid fund outflows by foreign funds and importers despite firm trading in equity market.

At the Interbank Foreign Exchange Market, the local currency was trading down by 23 paise to 67.96 per dollar from a previous close of 67.73 per dollar at 12:24 hours.

Meanwhile, the 30-share barometer index of Bombay Stock Exchange, Sensex was at 25941.71, up by 134.61 points or by 0.52 per cent, and the NSE Nifty was at 7950.75, up by 42.5 points or by 0.54 per cent.

According to Dun & Bradstreet report, the rupee is likely to remain under pressure and is expected to trade in the range of around 67.70 – 67.90 per dollar this month, citing limited foreign capital flows due to low productivity in the Winter session of Parliament and ambiguity over implementation of GST.

IMA requests Govt to exempt healthcare services from GST

14/12/2016 10:00

The Indian Medical Association (IMA) has urged the Government to exempt healthcare services offered by private hospitals from the Goods and Services Tax (GST), said media reports.

Commenting on the issue, IMA’s Dr K K Aggarwal told the media, “We welcome the government’s decision on enforcing the GST and feel that it will increase transparency and improve efficiency in the country.”

“However, we feel that the GST exemption of healthcare services offered by governmental institutions should be extended to the private sector as well,” he added.

As per reports, IMA stated that exemption of GST to private sector shall result in several benefits which will include no increase in cost of healthcare being provided by the private sector, affordable healthcare services in India, eradication of any possibility of dis-incentivising future investments in the sector, among others.

GST Council to resolve dual control issue on Dec 22-23: Reports

13/12/2016 10:03

Hopes of meeting the Centre’s targeted GST implementation deadline of April 1, 2017, receded further in a situation of political confrontation unleashed by its demonetisation measure after the two-day meeting of the GST Council scheduled to end on Monday being cut short half-way.

As per reports, the Goods and Services Tax Council, chaired by Union Finance Minister Arun Jaitley, was originally slated to meet on December 11-12 to sort out the vexed issue of “cross empowerment”, or dual control of assessees under the proposed pan-India indirect tax regime. The solution had eluded a consensus over five previous meetings of the GST Council.

As per reports, the meeting was also expected to finalise three legislations — Central GST, Integrated GST and the Compensation law — with the intent of placing these in Parliament during its ongoing Winter Session that ends on December 16.

As per reports, deadlock continued on the issue of dual control between the Centre and the states, while the next meeting of the Council has been fixed for December 22 and 23.

MFs pump in Rs 1.78 lakh cr in debt mkts in Apr-Oct

03/11/2016 17:00

Mutual fund managers have pumped in over Rs 1.78 lakh crore in debt market during the April-October period of the current financial year, primarily on account of strong participation from retail investors.

Besides, they invested a net Rs 21,000 crore in equity markets during the period under review.

Industry experts attributed the inflows to increased participation from retail investors and positive sentiment that was boosted after long-stalled GST Constitution Amendment Bill was passed in Parliament in August this year.

As per the data released by the capital markets regulator Securities and Exchange Board of India (Sebi), mutual fund managers invested a net sum of Rs 1.78 lakh crore in April-October period of 2016-17. They had pumped in Rs 2.03 lakh crore between April and October in 2015-16.

For the entire 2015-16 fiscal, fund managers had put in a net amount of Rs 2.73 lakh crore in the debt market.

This inflow has helped the mutual fund industry to reach over Rs 16 lakh crore mark in assets under management (AUM) at the end of September, as per the latest data.

In comparison, Foreign Portfolio Investors made a net investment of just Rs 3,000 crore into debt markets during the first seven months of the current fiscal (2016-17).

A mutual fund is an investment vehicle with a pool of funds collected from investors to buy securities such as stocks, bonds and money market instruments.

Markets remain volatile; ICICI Bank, ITC shares dip

19/10/2016 10:20

The key domestic benchmark indices were trading in a negative terrain in the morning trading session as volatility was witnessed across the bourses. Shares of NIIT, Hindustan Zinc and Tata Coffee will be in focus as these companies reveal their September quarter earnings. Optimism over the Indian economy amid swift progress on the implementation of GST and firm growth focus by the RBI may buoy sentiments later in the day.

At 10:20 AM, the Bombay Stock Exchange bellwether Sensex was at 27994.35 down by 56.53 points or by 0.2 per cent, while the NSE Nifty was at 8669.2 points, trading lower by 8.7 points or by 0.1 per cent.

The BSE Sensex touched an intraday high of 28131.07 and an intraday low of 27977.77 while the NSE Nifty touched an intraday high of 8698.75 and an intraday low of 8660.6 The top gainers of the BSE Sensex pack were GAIL (India) Ltd. (Rs. 442.00,+2.92 per cent), Sun Pharmaceutical Industries Ltd. (Rs. 756.45,+1.68 per cent), Wipro Ltd. (Rs. 488.55,+1.50 per cent), Lupin Ltd. (Rs. 1497.00,+1.03 per cent), Axis Bank Ltd. (Rs. 537.40,+0.96 per cent), among others.

Meanwhile, ICICI Bank Ltd. (Rs. 266.50,-1.44 per cent), ITC Ltd. (Rs. 242.70,-1.26 per cent), Tata Consultancy Services Ltd. (Rs. 2374.25,-1.00 per cent), Mahindra & Mahindra Ltd. (Rs. 1320.00,-0.89 per cent), Hindustan Unilever Ltd. (Rs. 846.95,-0.89 per cent), were among the top losers on BSE.

The Market breadth, indicating the overall strength of the market, was strong. On BSE out of total 2198 shares traded, 1325 shares advanced, 758 shares declined while 115 were unchanged.

On the global front, Asian stocks were trading higher today as China’s economy was stable in the September quarter, while oil prices rallied. US stocks closed higher in the previous trading session as robust Q3 earnings from the likes of Goldman Sachs and Netflix, coupled with improving US inflation boosted the sentiments.