The bill to nullify retrospective taxation offers a fair solution within the framework of Indian law and Parliamentary sovereignty to companies which have been subjected to such demands, Finance Secretary T V Somanathan said on Thursday. Finance Minister Nirmala Sitharaman introduced 'The Taxation Laws (Amendment) Bill, 2021' in the Lok Sabha that seeks to withdraw tax demands made using a 2012 retrospective legislation to tax the indirect transfer of Indian assets. The Bill provides for the withdrawal of tax demand made on "indirect transfer of Indian assets if the transaction was undertaken before May 28, 2012 (i.e. the day the retrospective tax legislation came into being)."
The Centre plans to create a special window for strategically important investors such as sovereign wealth funds and pension funds that wish to invest over Rs 3,000 crore through a single transaction.
Industry players believe the new DFI model will be initially risk capital, which will then be used to mobilise additional resources from development agencies such as World Bank.
At present, the EPFO is mandated to invest 20-45 per cent of its incremental funds - of around Rs 1.5 trillion - in debt-related instruments.
India's Rs 4.5-trillion fast-moving consumer goods (FMCG) sector was one of the first to bounce back from the lockdown induced blues, reporting a year-on-year (YoY) growth in the October-December quarter last year. That said, the overall consumption figures continue to remain depressed. The FMCG market, which includes daily consumables like branded atta, hand sanitizers, edible oils, shampoos, razors, and so on, recorded 7.3 per cent value growth during the period, while the smartphone market grew by 21 per cent.
Faced with prospect of its assets across the globe being seized just like Pakistan and Venezuela, the government decided to scrap retrospective taxation but the international embarrassment could have been avoided had 'attached' shares of Britain's Cairn Energy Plc not been sold, according to tax and legal experts. On Thursday, the government introduced a Bill in Parliament to scrap the tax rule that gave the tax department power to go 50 years back and slap capital gains levies wherever ownership had changed hands overseas but business assets were in India. The 2012 legislation was used to levy a cumulative of Rs 1.10 lakh crore of tax on 17 entities, including UK telecom giant Vodafone, but substantial punitive action was taken only in the case of Cairn.
Other decisions piled up include rationalisation of GST rate slabs, correction of inverted duty on certain items and inclusion of petroleum products.
According to the survey by Deloitte India and National Human Resource Development, 35 per cent of Indian businesses are expecting a strong growth this year while another 45 per cent feel that it would be moderate.
According to official sources, the number reflects pick up in consumption and improvement in compliance as well.
Chief financial officers in the country are cautiously optimistic about the future and are neutral about their companies' performance in the short term, said the Deloitte India CFO Survey 2013.
In the start-up world, hitting the $1-billion mark, which accords the "Unicorn" tag, is a milestone. Enterprises typically reach the milestone only by series C or series D, or three to four funding rounds later. Zeta achieved it at the first one. On May 25, the six-year-old banking tech firm raised $250 million from Japanese conglomerate SoftBank, at a post-money valuation of $1.45 billion. "This is the first time we have raised institutional money," Zeta co-founder Bhavin Turakhia beamed on the conference call. This trajectory is uncommon in start-ups.
The I-T department issued a circular allowing manual filing of Form 15CA/15CB (required for foreign remittances) with banks till June 30, so that business transactions may go on. The forms will be uploaded online on the e-filing portal later, it added.
Pulse oximeters, hand sanitisers, temperature check equipment and ambulances too will attract lower 5 per cent tax.
India's factory output climbed 22.4 per cent in March, benefiting from the base effect of the lockdown-marred month a year back as well as a turnaround in the manufacturing sector, while retail inflation slipped to a three-month low of 4.29 per cent in April. The high positive annual growth in the index of industrial production (IIP) in March 2021 came on back of a contraction of (-)0.9 per cent and (-)3.4 per cent in January and February 2021 respectively, according to the data released by the National Statistical Office (NSO) on Wednesday. This turnaround was led by recovery in the mining, manufacturing and electricity sectors.
The bulk of states' revenue comes from the devolution from the Centre's divisible tax pool, GST, VAT on petroleum, and excise duty on alcohol.
Other measures being considered include relatively stringent KYC norms and a separate standard operating procedure for approval, renewal, and fresh investment from India's neighbouring countries.
India Inc is expected to offer average salary increments of 11.3 per cent this fiscal and those working in sectors like pharmaceuticals, health care and life sciences are expected to get a raise of 13.1 per cent.
Goa, Kerala, Maldives and Dubai are among the popular destinations.
Experts warn of over-interpreting the numbers and said their sustainability needed to be watched beyond November, says Indivjal Dhasmana.
The mop-up could have been much higher, but tax on imports fell 2 per cent y-o-y.
The lingering slowdown, election-led uncertainties and strict regulatory interventions have been affecting growth and pulling down profits, according to a survey of chief financial officers.
Most of the hirings are, however, in the entry or junior level.
The new definition under the Code of Wages, 2019, includes three components: basic pay, dearness allowance and retention payment.
The new restriction will be challenging for businesses, as they will have to do regular follow-ups with their suppliers.
After contracting for two quarters in a row, the Indian economy entered the positive territory with a growth of 0.4 per cent in the October-December quarter, mainly due to good performance by farm, services and construction sectors, official data showed on Friday. Trade and hotel industry registered a contraction of 7.7 per cent during the third quarter this fiscal, as the sectors continued to suffer on account of coronavirus pandemic. According to the data released by the National Statistical Office (NSO), the farm sector recorded a growth of 3.9 per cent, and the manufacturing sector output grew by 1.6 per cent in the quarter under review.
India's tax pie seems to have undergone a subtle change with a sharp drop in direct tax collections resulting from a disproportionate impact of the COVID-19 carnage on incomes. The share of indirect taxes, which mainly comprise of levy on goods and services as well as import duty, has risen while that of direct taxes - made up of corporate and personal income tax - has gone down in 2020. In an interview with PTI, finance secretary Ajay Bhushan Pandey said in a pandemic like this where the economy has been impacted, any large scale changes impact direct taxes more severely, whereas indirect tax collection is mostly proportional to business turnover and compliance.
With India's GDP clocking a lower contraction of 7.5 per cent in the September quarter, industry and experts expressed confidence of further recovery in the coming months and said the government's actions are bearing fruit. In a tweet, Vedanta chairman Anil Agarwal said, "Q2 #GDP numbers show that economy is recovering. Government's efforts on stimulus and reform are showing results. Hopefully, we will have positive growth in H2 FY21 and double digit growth in FY22."
India's economy recovered faster than expected in the September quarter as a pick-up in manufacturing helped GDP clock a lower contraction of 7.5 per cent and held out hopes for further improvement on better consumer demand. The gross domestic product (GDP) had contracted by a record 23.9 per cent in the first quarter of the 2020-21 fiscal (April 2020 to March 2021) as the coronavirus lockdown pummelled economic activity.
The Central Board of Excise and Customs, through a notification on February 12, has slashed the duty on both the variants of motorcycles imported as completely build units (CBU) to 50 per cent.
According to Parizad Sirwalla, partner (tax), KPMG, the withdrawal of annual tax free transport allowance and medical reimbursements has squared off the benefit on account of standard deduction.
To improve compliance, govt may introduce lottery reward for filing GST. The Consumer Welfare Fund, where anti-profiteering proceeds are deposited, will be used to reward the lucky winners on monthly and annual bases. The prize money, yet to be fixed, may run into several lakhs of rupees for the annual draw, and about Rs 50,000 for monthly draws.
Deloitte will assist Hyderabad Metro and the Andhra Pradesh government in preparation of bid documents, evaluation of bids, revision of the financial model, selection of concessionaire and negotiations with financial institutions for financial closure. The consultancy contract will be in force for one year.
GST collections in March slipped below the psychological Rs 1 lakh crore-mark for the first time in four months to Rs 97,597 crore as the Covid-19 lockdown that shut most businesses compounded tax collection woes in an already sluggish economy. Goods and Services Tax (GST) mop-up in March recorded a 8.4 per cent decline over March 2019 collection of Rs 1.06 lakh crore. The collections were lower on account of dip in revenues from domestic transactions as well as imports.
Global business consultancy firm, Deloitte, plans to almost double its India workforce to 24,500 over the next 30 months, a top company official said.
The main issues confronting CFOs currently, according to Deloitte, are the current economic slowdown, a depreciating rupee and inflation.
Going forward, the February factory output may be impacted as several industries such as automobiles, technology, pharma and fashion have some exposure to imports of raw and intermediate materials from China.
The revenue collection in the same month a year ago stood at Rs 94,442 crore.
India will have to wait till the third quarter of this fiscal to witness the rebound in manufacturing, triggered by low-end consumer durables growth in semi-urban areas, says research firm Deloitte.
Riding on this change in aspirations, V-Mart a value retail chain is growing close to 22 per cent year-on-year, and is aggressively looking to expand its footprint, with 60 new stores this year.
With auditing under the scanner and two of the Big Four firms stopping non-audit services for audit clients, auditors will now be subjected to a more stringent standard of reporting.
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