Though the states might lose because of providing tax credit on input, they will also gain by way of taxing services. At present, only the Centre taxes around 100 types of services. Thus, the actual losses states might incur cannot be estimated until the GST is implemented.
In a note, titled 'IIFCL financing for PPP projects,' sent to Prime Minister Manmohan Singh, Ahluwalia wrote, 'It was pointed out in the meeting that the term of the current CMD (chairman and managing director) of IIFCL ends on March 10. The FS (finance secretary) had indicated that the term can be extended. Action on this front should be expedited to avoid loss of momentum.'
Though CST is a central tax, the entire collection, estimated at Rs 250 billion per year, goes to the states. CST was to be cut to 1 per cent from April this year before its phase-out; from April 1, 2010, the country will transit to a uniform goods and services tax regime. "It was recommended by the empowered committee of state finance ministers that the CST rate of 2 per cent should continue until GST is implemented," said a source familiar with the development.
GST, which will replace almost all central and state taxes, could have two components of 8 per cent each -- one will go to the Centre and the other to the states, according to sources familiar with the talks between the Centre and the states. However, it will not cover tax on petroleum products and Customs duty.
Serious Fraud Investigation Office joins multi-agency probe.
The government is planning to nominate full-time directors while inducting the remaining seven members in the reconstituted board of Satyam Computer Services Ltd, said a top corporate affairs ministry official. The ministry of Corporate Affairs (MCA), which got an interim order from the Company Law Board to supersede the existing board of the Hyderabad-based company, is planning to make the announcement within a week to ensure smooth functioning at Satyam.
The Income Tax department is likely to include eight other related firms for its investigation into the possible tax evasion by Satyam.
PricewaterhouseCoopers, an advisory and consulting firm whose sister company audited the accounts of Hyderabad-based Satyam Computer Services, has a chequered past with Indian tax authorities, having admitted its "mistake" in at least two cases of tax evasion.
Deficit-financed tax cuts could be a better option to revive the economy hit by global financial crisis as government spending is not effective due to leakages and delay in execution, economists feel.
Low commodity prices and a likely softening of interest rates have set the right business conditions, but the revival of demand - both in domestic and overseas markets - will be the key driver in 2009, experts said.
Interestingly, these recovery officers do not have the power to reduce the amount stated in the order issued by the presiding officer. The annual review was published "to point out irregularities or deficiencies which need the immediate attention of the Heads of Departments", S M Kumar, chief controller of accounts, said in the review for 2007-08.
The higher tax paid by the banks comes in overall 22 per cent decline in advance tax collections in the third installment that was due by December 15. He said BoB is not revising the revenue and profit targets for the 2008-09 fiscal, despite overall slowdown affecting the economy, which is projected to grow at less than 7 per cent in the second half.
The government is likely to revise downwards indirect tax collections target for the current financial year by at least Rs 20,000 crore.
During a verification of electronic returns, the department found that as many as 1,714 taxpayers under the self-assessment scheme (where tax-payers determine their tax liability and pay accordingly) had not paid their tax dues. In a few cases, the amount due was around Rs 100 crore (Rs 1 billion). The government made it compulsory for companies to file their returns online from 2006.
Secretaries' panel fails to arrive at a decision. Sources told Business Standard the commerce ministry felt that the delay would add to the cost for the government as more and more factories could shut shop.
The meeting comes ahead of a fresh stimulus package aimed at sectors not covered in the earlier measures announced by the central bank and the government.
The Centre and the state governments have agreed not to unilaterally change the tax rate on goods and services, once the Goods and Services Tax (GST) is implemented from April 2010.
Under the standard fire and special perils policy, everything is excluded other than whatever is named specifically in the cover. Removal restriction on an all-risk policy will also result in greater adoption of loss of profit insurance, which is a critical risk for any company. Insurance companies are likely to offer value-added services like a replacement car in case of a car breakdown and full compensation (without any depreciation) if the car is damaged.
Employment data are currently estimated once in five years through a sample survey by the National Sample Survey Organisation.
The finance ministry has now decided to extend the coverage of the scheme to tax deducted at source and service tax returns to provide round-the-year work to the TRPs, as majority of existing prepares had shown signs of disinterest due to seasonality of their job. Previously, the ministry was planning to create a separate set of tax preparers for filing service tax returns.
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