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GST Council Reduces Rates for 66 items

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Arun Jaitley

New Delhi, June 11 : The Goods and Services Tax (GST) Council at its 16th meeting here on Sunday revised the rates of 66 items out of the 133 for which representations had been received seeking change from the fitments originally made in the four-slab indirect tax structure, Union Finance Minister Arun Jaitley said. Industry hailed the GST Council’s latest decisions as beneficial, particularly for small and medium enterprises.

Following the 15th meeting of the council here earlier this month, held to decide on the six remaining items — including gold and beedi — from the Srinagar meeting which had decided upon 1,211 items, Jaitley had said that a committee of officers would examine rate adjustments, if any, based on the representations received from different trade and industry associations. Their recommendations were taken up by the council on Sunday.

“The 133 representations received were considered at length and the officers’ committee made their recommendations… the council has reduced tax in 66 out of the 133 cases,” Jaitley, who heads the council, told reporters here following the meeting.

The Minister explained that the cases for reduction had been considered keeping two objectives in mind.

“One was to maintain equivalence to the existing taxes, and in some other cases the fitment had breached this equivalence principle. In others, the reduction is required because of the changing nature of the economy and changes that have occurred in consumer preference,” he said.

Elaborating on some of the reductions, Jaitley said the tax on cashew has been cut from 12 to 5 per cent. Packaged foods like food and vegetable products such as pickles, chutnies, ketchup and instant food mixes, among others, which historically were taxed at 18 per cent, are going to be taxed at 12 per cent as these are items used by common people, he said.

Tax on cutlery will come down from 18 to 12 per cent, while computer printers will be lowered from 28 to 18 per cent. Insulin and agarbatti will go down from 12 to 5 per cent.

Among other goods, Jaitley said school bags have been lowered from 28 to 18 per cent, while exercise books will come down from 18 to 12 per cent.

All goods and services under the pan-India GST regime, which will subsume the existing multiple central and state levies, have been categorised in four tax slabs of 5, 12, 18 and 28 per cent, besides those items that attract zero tax.

On Entertainment Tax, Jaitley said that following representations from the film industry, the GST Council has decided on a two-slab structure for cinema tickets, whereby those costing less than Rs 100 would be taxed less at 18 per cent, while those above will attract tax of 28 per cent.

In order to encourage job work outsourcing in sectors like diamond, leather, textiles, jewellery and printing, where workers take the work home, the GST rate has been reduced to 5 per cent.

Besides, traders, manufacturers and restaurants with turnover of up to Rs 75 lakh can avail themselves of the composition scheme, against Rs 50 lakh earlier, Jaitley said.

He also said that lottery tickets and e-way bill are two specific issues that will be taken up at the next meeting of the council here on June 18.

While BJP-ruled states gave a go ahead to July 1 roll-out of the GST, West Bengal Finance Minister Amit Mitra continued to raise serious doubts over the feasibility of the new indirect tax regime and proposed its postponement by a month or so.

“I have also added a caveat (in the GST Council meeting) that July 1 looks extremely difficult. But you cannot do frugal innovation for world’s largest fiscal reform called GST. And you are going to start GST from July 1. So my submission was, let us not do frugal innovation for something which is world’s largest fiscal reform,” Mitra told reporters after the meeting here.

He said that there is no harm in postponement of the GST “by one month or so”.

Union Finance Minister Arun Jaitley reiterated that the traders and industry had no option but to get ready by July 1 as no postponement was on the anvil.

“Irrespective of the date at which is to start, some people will say we are not ready. They have no option but to get ready. You require honest intent for that,” he told reporters when asked about some industry representatives seeking more time for the roll-out.

Industry and stakeholders on Sunday hailed the GST Council’s move of bringing traders, manufacturers and restaurants below Rs 75 lakh turnover under the Composition Scheme saying that it will boost small and medium enterprises in the country.

“This is a big decision in favour of traders. Its a people -centric decision, will benefit for the common people. The biggest win is for SMEs today. Biggest development for small and medium enterprises (SMEs) and small businesses that contribute on a large scale to the GDP and job sector of the country,” the West Bengal Finance Minister said.

“The purpose of GST is to protect SMEs, protect states’ revenues and benefit people. By stimulating SMEs, which are labour intensive, taxes will go up, impact on GDP will go up and if implemented in appropriate manner, it can lead to greater revenues,” Mitra said.

Traders who have below Rs 75 lakh turnover will have to pay 1 per cent tax, manufacturers will have to pay 2 per cent while restaurant businesses will have to pay 5 per cent if they opt to go for the Composition Scheme under GST.

Pratik Jain, Partner and Leader Indirect Tax, PwC, said: “Increasing the composition scheme limit to Rs 75 lakh from Rs 50 lakh will provide relief to many more small businesses, though service providers (except restaurants) continue to remain outside the ambit of composition levy.”

Mahesh Jaising, Partner, Indirect Tax, BMR and Associates LLP said: “The GST Council has decided to increase the threshold of the composition scheme. This should mean that a significant number of SME sector players should benefit from not having to meet with detailed compliances under GST and also having a less financial burden, on account of GST.”

India

Your money is safe in banks, says Modi on FRDI

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New Delhi, Dec 13: Prime Minister Narendra Modi on Wednesday sought to allay the fears of bank account holders, saying their deposits in banks will be safe and their interests would not be harmed in any way.

Addressing the Ficci annual general meeting, he said rumours were being spread by some sections about provisions of the proposed Financial Regulation and Deposit Insurance (FRDI) Bill under which the depositors would suffer.

“The government is trying to strengthen the banking system by policy initiatives on a daily basis. But on social media rumours are being spread about the FRDI Bill, which is completely opposite to the reality. We are trying to protect the depositors interest and the banks as well,” Modi said.

He was apparently referring to the raging controversy over a bail-in provision in the FRDI Bill under which banks will be allowed to forfeit major portion of deposits of account holders in case of crisis in the financial institution.

The Prime Minister said the UPA government had completely spoilt the banking system of the country. He said the biggest liability passed on by the previous government was the non-performing assets (NPA).

Modi said the last government had put pressure on banks and forced them to lend to influential people, which further led to NPAs. “Commonwealth scam, 2G scam and Coal scam, and the biggest scam – the banking scam – all happened during UPA regime.”

He said the government is working to create a system that is transparent and sensitive.

Talking about the Goods and Services Tax (GST), Modi said the government’s effort is to ensure that maximum businesses register for GST. “The more formal the system becomes, the more it will benefit the poor. It will enable easier availability of credit from the banks, and reduce cost of logistics, thereby enhancing competitiveness of businesses.”

Modi recalled that around the time of Ficci’s founding in 1927, Indian industry had united against the Simon Commission that was constituted by the then British government. He said that Indian industry had joined all other sections of Indian society, in national interest, at that time.

He said a “similar atmosphere” exists today when people of the country are coming forward to fulfil their responsibilities towards the nation. Modi said the hopes and aspirations of people are to rid the country of internal problems like corruption, and black money.

IANS

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India

10% hike in placements at IIT Delhi

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New Delhi, Dec 13: In comparison to last year, the Indian Institute of Technology (IIT) Delhi witnessed an increase of 10 per cent in the number of placements offered to students this season so far, the institute said on Wednesday.

Till the 10th day of the ongoing placement exercise which began on December 2,  the institute registered a 10 per cent rise in the overall jobs offered to students across streams, while for the Post Graduate (PG) students this increase was 17 per cent against last year.

“While the overall placements have been better than last year, recruitment trends of PG students is very encouraging for the future of engineering research in the country,” news agency IANS quoted, I.N. Kar, Professor-in-charge of Training and Placement at IIT Delhi, wrote in a statement.

“I am hopeful that the overall percentage increase in the recruitment of both UG (Under Graduate) and PG students will improve further”, Kar added.

The score is likely to climb up by the end of this phase of the placement season on December 15. The next phase will commence in January next year.

WeForNews 

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Deadline to link Aadhaar with bank accounts extended till March 31

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Aadhaar

New Delhi, Dec 13: The deadline to link the Aadhaar number with bank accounts has been extended by three months till March 31, the government announced on Wednesday, as the Supreme Court is set to commence hearing from Thursday on its mandatory linking to various schemes.

The deadline was earlier December 31 for linking the 12-digit unique identification number with both Permanent Account Number (PAN) and bank accounts. However, the government extended the deadline last week for linking it with PAN till March 31.

A notification to link it with bank accounts was later issued on Tuesday by the Department of Revenue under the Finance Ministry. The notification, however, did not mention the new deadline, leaving it open-ended.

The government later issued a press release which contained the deadline of March 31.

According to the December 12 notification, the words “submit the Aadhaar number and PAN by December 31, 2017” have been substituted by “submit the Aadhaar number, PAN or Form No 60 by such date as may be notified by the Central government”.

The release said under the provisions of Prevention of Money-laundering (Maintenance of Records) Second Amendment Rules, 2017, it was provided that if a client already having a bank account or any other account-based relationship with reporting entities prior to date of this notification fails to submit the Aadhaar number and PAN by December 31, “the said account shall cease to be operational till the time the Aadhaar number and PAN is submitted by the client”.

In case of a person opening a new account, the deadline for submitting Aadhaar number and PAN was “six months from the date of the commencement of the account based relationship”.

“After considering various representations received in this regard and inputs received from banks, it has been decided to notify March 31, 2018 or six months from the date of commencement of account based relationship by the client, whichever is later, as the date of submission of the Aadhaar number, and Permanent Account Number or Form 60 by the clients to the reporting entity,” the statement said.

IANS

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