Government to easen GST norms for small businesses

The Goods and service tax regime may have been burdensome for small businesses to get acclimatized to  and although the current norm requires traders with an annual turnover of Rs. 20 lakhs and above to register under the GST system, for the businesses to fully exploit the benefits of the new system it is important that everybody from the raw material trader to the vendor registers under the system.

To this effect, the government is planning an easier set of rules to comply with for the convenience of small businesses with an annual turnover of under Rs 20 lakh.

This decision comes after Prime Minister Narendra Modi urged tax officials to help these traders and small businesses to migrate to the GST rule everyone in the production chain might be cumbersome, the government acknowledges these predicaments, “It should be like Saral (the income tax form), which should be a single-page form with only the sales and purchase details to be furnished,” a senior government official, who did not wish to be named, as reported in the Times Of India.

The registration process might be cumbersome along the chain, but the government has duly noted these predicaments, “It should be like Saral (the income tax form), which should be a single-page form with only the sales and purchase details to be furnished,” a senior government official, who did not wish to be named, as reported in the Times Of India.

Meanwhile, the new compliance mechanism is in its infancy and is being worked out by the Central Board of Excise and Customs. Once the conceptualization is done, the compliance rules will then be finalized by the GST Council.

The main idea is to expand the current tax base while ensuring that those registered under GST and who are doing business with non-registered entities have a fair and legitimate database of their business links.

Sources: Times Of India, Deccan Chronicle 

Image source: Deccan Chronicle 

India’s Forex for the first time crosses $400-billion mark

The forex exchange reserves of India for the first time crossed $400-billion mark on September 8. It showed  $400.727 billion as per Reserve Bank of India data. It almost took a decade for the RBI to shore up by $100 billion to cross $400 billion from $300 billion.

The Foreign Currency Assets (FCAs) which mainly accounts purchase and sale of foreign exchange by the RBI, income arising out of deployment of foreign exchange reserves, external aid receipts of the government and revaluation of assets, increased by $2.568 billion to $376.209 billion.

FCAs are expressed in US dollar terms and also include the effect of appreciation or depreciation of non-US dollar currencies, such as the euro, the pound and the yen held in the reserves.

Gold reserves remained stable at $20.69 billion. Special drawing rights (SDR) from the International Monetary Fund, an international reserve asset created by the IMF and is allocated to its members in proportion of their quota at the multilateral agency, rose by $14.2 million from the previous week to $1.52 billion.

Interestingly, India has seen the third-highest reserves accretion globally after Switzerland and China so far in 2017.

 

Sources: Financial Express, NDTV

Image Source: defence.pk

3% decrease in India’s external debt in FY17

India’s external debt came down by $13.1 billion to $471.9 billion at the end of March this year on annual basis. This 2.7 percentage decrease in debt has been mainly due to decrease in NRI deposits and commercial borrowings.

The debt has remained within manageable limits and the situation has improved in 2016-17 over 2015-16, said ‘India’s External Debt: A Status Report 2016-17’ by the Department of Economic Affairs. The external debt-GDP ratio fell to 20.2 per cent at the end of March 2017 from 23.5 per cent at March 2016. At end-March 2017, long-term external debt was $383.9 billion, showing a decrease of 4.4 per cent year-on-year.

Long-term external debt accounted for 81.4 per cent of total external debt at end-March 2017. “Short-term external debt increased by 5.5 per cent to $88 billion at end-March 2017. This is mainly due to the increase in trade related credits, a major component of short-term debt with a share of 98.3 per cent,” the report said.

A cross country comparison based on ‘International Debt Statistics 2017’ of the World Bank, which presents the debt data for 2015, shows that India continues to be among the less vulnerable countries with its external debt indicators comparing well with other indebted developing countries. The ratio of India’s external debt stock to Gross National Income (GNI) was the fifth lowest and in terms of the cover provided by foreign exchange reserves to external debt, the position was sixth highest in 2015.

Sources: The Financial Express, ANI

Mistry family objects Tata Sons’ plan to become a private limited firm

Ahead of the annual general meeting scheduled for September 21, Tata Sons have proposed the idea of converting itself into a private limited firm from a public limited one. The plan has been suggested solely because the company feels that its status as the ‘deemed public company’ is not statutorily recognized under the Companies Act, 2013.

However, the Mistry family, who have been at loggerheads with the Tata’s from quite some time, have objected this move. A letter from Cyrus Investments said, ” The proposal to convert Tata Sons from a public company to a private company constitutes yet another act of oppression of the minority shareholders of Tata Sons at the hands of the majority shareholders.”

The Mistry family holds 18.4 percent stake in Tata Sons, while Tata Trusts holds 66 percent stake. Moreover, the disagreement by Mistry family has come after months of legal battle between the two groups following Cyrus Mistry’s removal as Chairman of salt-to-steel business.

Meanwhile, the special resolution will only be passed if 75 percent of the votes are in favor to bring about a change in Tata Sons’ corporate system.

Business Today, NDTV Profit

Trump blocks sale of US Tech firm to Chinese company

Trump administration has blocked the sale of a US technology firm, Lattice Semiconductor Corporation, by the Chinese-backed company, Canyon Bridge Capital Partners, citing National security concerns.

The US government reportedly uses Lattice products and they were concerned about the potential transfer of “intellectual property” which would happen as a result of the deal. This move comes amidst the progressively tough stand adopted by the US on business dealings with China.

The decision was taken under the Defence Production Act which authorizes the President to suspend or prohibit certain acquisitions by foreign parties that are deemed to be a threat to national security. The US Treasury Secretary Steven Mnuchin, who is also the chairman of Committee on Foreign Investment in the United States (CFIUS), whose recommendations aided in Trump’s decision, welcomed the move.

The company which has been seeking approval for the $1.3bn deal since November said in their statement that they were” disappointed” by the President’s decision whereas Lattice in their statement said that the shelved deal “was in the best interests of our shareholders, our customers, our employees and the United States”.

Sources: Economic Times, BBC 

Tax evaders to face strict action: CBDT Chairman Sushil Chandra

The income tax department awaits the conclusion of its investigations on financial dealings of around 100,000 individuals who are suspected of tax evasion and persuade many others caught in the act to start filing tax returns, as told by Sushil Chandra, chairman of the Central Board of Direct Taxes (CBDT), in an interview with Mint.

Chandra further added that the department won’t spare those who make high value purchases and investments but do not file returns. The tax authority is on a massive data-crunching exercise that would make tax evasion difficult and bring the evadors into limelight. The drive also covers those who keep unaccounted funds abroad.

This exercise is being done as a part “Operation Clean Money”, which basically deals with analyzing cash deposits made post demonetisation, after which the department identified  about 754,000 medium-risk, 595,000 low-risk and 341,000 very low-risk assessees in terms of the tax amounts they may have cheated on.

While the individuals in the high risk category will be given priority. The people who fall under the low risk category will get e-mails urging them to file returns.

Besides bringing unaccounted wealth under the tax net, the government will seek to boost revenue to finance a 6.5% jump in its spending to Rs21 trillion in the current financial year from that of last year.

A  three-year low of 5.7% economic growth rate that ended June and declining revenue from the debt-ridden telecom sector, which is battling strong competition, make it imperative for the government to optimize tax revenue growth.

In the first quarter, there was a rise, albeit not very significant, in gross personal income tax receipts and gross corporate tax receipts in the period from a year ago, on which the CBDT chairman said that it was not unusual.

In the annual budget for 2017-18, finance minister Arun Jaitley set a full-year growth target of 15.7% for corporate and personal income tax receipts to Rs9.8 trillion.

Sources- The Mint

DRI seizes gold worth Rs 2 crore, smuggled in India

The Directorate of Revenue Intelligence (DRI) has seized more than seven kilograms of gold bar smuggled into India from Bangladesh, reported Financial Express and Business standards. The value of these gold bar is estimated to be over Rs two crores.

Nearly 50 gold bars having foreign markings, weighing 7412.43 grams, and valued at over Rs 2.04 crore were found and seized from the three accused. The agency was working on a tip-off. They got hold of a black Alto car from the eastern part of Kolkata and arrested the three accused Indrajit Biswas, Selim Molla and Rabiul Islam, who hail from India-Bangladesh border areas.

The accused admitted of smuggling the gold bars from Bangladesh into

India. The accused were supposed to further deliver them at Kolkata. All the three accused had been produced before the court and have been remanded judicial custody till September 21.

This year, the agency has seized over 150 kg of gold from West Bengal and north-eastern states. The value of this is valued close to Rs 44 crore in the market, which was smuggled from Bangladesh, Myanmar, and Bhutan.

News Source: Financial Express, Business Standard

Image Source: Indian Express