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Task force on Income Tax will read law chapter by chapter: Adhia

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Hasmukh Adhia
Hasmukh Adhia File Photo IANS

New Delhi, Nov 23: The Income Tax Act, 1961 will be read “chapter by chapter” by the new task force constituted for drafting a new direct tax legislation, Finance Secretary Hasmukh Adhia said on Thursday.

In an interaction with select Editors, he said while some of the good provisions of the direct taxes code prepared by the previous government have already been incorporated in the income tax law, a need has been felt for complete revamping of the IT act.

The Task force will be reading “chapter by chapter” the IT act and recommend changes. “With moderate tax rates, we will not need so many provisions relating to exemptions under chapter 10 and the like,” he said.

After changes, the law will continue to be called the Income Tax Act and there was no proposal to name it Direct Taxes Code.

On Thursday, while announcing constitution of the task force of which Arbind Modi, Member (Legislation), CBDT, will be the Convenor, the government said during the Rajaswa Gyan Sangam held on September 1 and 2, Prime Minister Narendra Modi had observed that the Income-tax Act drafted more than 50 years ago, needs to be re-drafted.

Accordingly, in order to review the Act and to draft a new Direct Tax Law in consonance with economic needs of the country, the Government constituted the Task Force.

Apart from Arbind Modi, it will have Girish Ahuja, practicing Chartered Accountant and non-official Director, State Bank of India, Rajiv Memani, Chairman and Regional Managing Partner of E&Y, Mukesh Patel, Practicing Tax Advocate, Ahmedabad, Mansi Kedia, Consultant, ICRIER and G.C. Srivastava, retired official of the IRS 1971 Batch and Advocate as its members.

Dr. Arvind Subramanian, Chief Economic Adviser (CEA), will be a permanent Special Invitee in the Task Force.

The Terms of Reference of the Task Force is to draft an appropriate Direct Tax Legislation keeping in view the direct tax system prevalent in various countries,the international best practices, the economic needs of the country and any other matter connected thereto.

IANS

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‘Premature GST hurting small businesses, causing revenue shortfall’

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GST

New Delhi, Dec 14: West Bengal Finance Minister Amit Mitra on Thursday attacked the Central government on what he called “premature GST launch” and said it had led to revenue shortfall of Rs 39,111 crore to states in just four months.

He said the “plummeting” GST collections by Rs 12,000 crore in one month was a serious cause of concern even as the premature implementation had led to serious problems for the small and medium enterprises which were “seriously hurting”.

Mitra, also a member of the GST Council, said under the Goods and Services Tax (GST) Act, Rs 43,013 crore worth revenue per month was protected for the states.

“So in four months, we needed Rs 1.72 lakh crore while we have got Rs 1.33 lakh crore. That means there is a protected revenue shortfall in four months of Rs 39,111 crore,” he said at the FICCI’s Annual General Meeting here.

He added the total amount budgeted for in the GST Council was Rs 55,000 crore for the full year.

“…Whereas we already have a shortfall of Rs 39,111 crore in four months. Even if you assume some improvement, probably it will end up as Rs 80,000 to 85,000 crore. Where will that money come from?

“The central government’s receipts have also sharply fallen from expectations. So states are worried what happens if Rs 80,000-85,000 crore becomes due from the central government as compensation,” Mitra said.

He attacked the government over the sharp decline in GST collections between September and October.

“September GST collections were Rs 95,131 crore whereas October collections plummeted by Rs 12,000 crore to Rs 83,346 crore. Rs 12,000 crore decline in one month has never been seen before. That concerns me deeply.

“The question on the table is what will happen next month and the following month. Among economists there is a feeling that this is not going to stabilize in a day or two,” Mitra said.

He added the main reason for this sharp decline was that small and medium enterprises were not able to file their returns.

He said under the “hastily-implemented” GST regime, the infrastructure was unprepared to handle the enormous number of returns and refund claims and hence manual systems had to introduced.

“It seems we have gone back a few steps even from the VAT era. In VAT era, we were completely digitised. Now we are still grappling with the fact that we have gone back to the manual.

“First by demonetisation, you kill the informal sector. Then you come to small and medium enterprises with this premature GST launch without homework. What you have done is that small and medium enterprises, which provide 40 per cent of GDP and 80 per cent of employment, are in a bad shape today,” Mitra said.

However, Jammu and Kashmir Finance Minister Haseeb Drabu and Bihar Deputy Chief Minister Sushil Modi defended the landmark indirect tax reform, saying the government was making all efforts to improve collections.

Expressing hope that revenue collections under GST will stabilise over the next few months, Modi said an exercise was going on to compare pre-GST and post-GST tax collection data to find out the cause of the shortfall and to identify any malpractices responsible for that.

He said 80-90 per cent of issues related to GST rates were resolved after the Guwahati GST Council Meet of last month.

“Now the big issue is how to improve compliance and make the IT network more user-friendly. Refund is also a big issue where problems exist and we are trying to solve those,” Modi said, adding the issue of input tax credit was also being worked out and complaints had reduced.

Drabu said the GST regime which we have arrived at was a result of decisions taken by the GST Council. “I take responsibility of every decision even if I don’t agree with them.

“Many of the errors in the current GST structure are our contributions. But while this transition may not be as glamorous as globalisation and liberalisation, it is the biggest move towards formalisation of economy,” he said.

Acknowledging problems faced by small and medium enterprises, Drabu said larger companies were not buying from small businesses due to lack of input tax credit and hence the composition scheme for small businesses should be adjusted to allow some input tax credit.

He also suggested abolishing the Maximum Retail Price (MRP) under GST. “MRP and GST regime don’t go together. We need to abolish the MRP and allow market forces to arrive at prices.”

IANS

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Supreme Court to pronounce order on Aadhaar mandatory linking tomorrow

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Aadhar Bill Supreme Court

New Delhi, Dec 14: The Supreme Court on Thursday reserved its interim order for Friday on a batch of pleas seeking a stay on the government’s decision of mandatory linking of Aadhaar with various welfare schemes, as the Centre extended the deadline up to 31 March next year.

 

SC on Friday will pronounce its order on a batch of petitions seeking stay of various Central and state government notifications mandating the linking of Aadhaar with various schemes including taking exam by the students, availing scholarship, cremation and treatment of HIV positive patients.

The government has already issued 139 notifications mandating the linking of Unique identification Number with various schemes including MNREGA, old age pension scheme, provident fund and Prime Minister’s Jan Dhan Yojana.

Reserving the order after the hearing spread over three and half hours on Thursday, the five judge constitution bench headed by Chief Justice Dipak Misra said that the regular hearing on the batch of petitions challenging the constitutional validity of Aadhaar being violative of right to privacy would commence on January 10, 2018.

The court indicated that it will address the government plea for mandatory linking of Aadhaar with the opening of new bank accounts in its order to be pronounced on Friday.

As Attorney General K.K.Venugopal insisted that linking of Aadhaar with the opening of new banks accounts should be allowed, the counsel for petitioners said that if in the last seven decades, the system of introduction by an existing account holder has worked, heavens would not fall if it continues for another three months.

The court is also likely to pass order extending February 6 deadline for the linking of mobile numbers with Aadhaar to March 31.

The government has already extended December 31 deadline on the linking Aadhaar with the existing bank accounts till March 31.

Read More: – Deadline to link Aadhaar with bank accounts extended till March 31

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NGT clarifies Amarnath cave shrine not a silent zone

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amarnath

New Delhi, Dec 14: The National Green Tribunal (NGT) on Thursday issued a clarification saying that it did not declare the Amarnath cave shrine a silent zone and that silence has to be maintained only in front of the ice shivlingam (the idol).

Declaring the shrine a silent zone on Wednesday, the green court had barred bells, chants and religious offerings beyond the entry point, news agency IANS reported.

The directions by a bench, headed by NGT Chairperson Justice Swatanter Kumar, were aimed at avoiding avalanches, maintaining the pristine nature of the holy cave and the eco-sensitivity of the region.

The decision invited protests from Hindu groups who called the order a diktat. However, a detailed order is awaited.

NGT appointed a committee on November 15 to look at environment protection during the annual Amarnath Yatra, had sought the authorities to ensure that the directions come into force before January 18, the next date of hearing.

Considered one of the holiest shrines in Hindu mythology, the Amarnath shrine, situated in the Himalayas in Jammu and Kashmir, is visited by lakhs of devotees during the pilgrimage season in the monsoon.

This year the annual pilgrimage to the Amarnath shrine witnessed more than 2.6 lakh pilgrims over 40 days between June 29 and August 7.

WeForNews 

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