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News Indirect Tax-Misc. - Indirect Tax

  • Aug 16, 2018
  • AAR rules out tax credit for CCD on supplies to SEZs

    The taxman wants to filter away some goods and services tax leeway that Café Coffee Day (CCD) sought to enjoy. The quasi-judicial Authority of Advance Ruling (AAR) has told CCD that the coffee chain cannot claim input tax credit on supplies to special economic zones (SEZ). In a July ruling, it said CCD’s supply to SEZ units (companies inside SEZ) does not qualify as “zero-rated supply” as it is not classified as an authorised SEZ transaction.

  • Aug 16, 2018
  • Indirect tax base has surged 65% to 11.6 mn since GST roll-out

    The indirect tax base in the country has expanded by 65 per cent to 11.6 million in a year since the roll-out of the goods and services tax (GST) on July 1, 2017, said Prime Minister Narendra Modi during his Independence Day speech on Wednesday. Under the previous tax regime, it was 7 million. The number of people filing direct taxes has also increased to 67.5 million, compared to 40 million in 2013-14 — a rise of 68 per cent.

  • Jul 26, 2018
  • E-commerce cos to face tax audit over GST refund issue

    The anti-profiteering authority has ordered audit of major e-commerce companies like Flipkart, Amazon and Snapdeal, to find out whether they have refunded the excess GST collected from the consumers. As per the order passed by the National Anti Profiteering Authority in the Flipkart case, the Director General of Audit of the Central Board of Indirect Taxes and Customs (CBIC) will conduct audit of all major e-platform companies and submit its findings to the authority.

  • Jan 22, 2018

    Even as the Centre appears confident of meeting the budgeted indirect tax collection target for FY18, a detailed analysis shows that it would have to mop up close to Rs.4.2 trillion in the last four months to meet the Budget Estimates. In comparison, in the first eight months of the current financial year, it is likely to have collected around Rs.5 trillion. The budgeted indirect tax collection target for FY18 is Rs.9.26 trillion. Even as the Centre appears confident of meeting the budgeted indirect tax collection target for FY18, analysis shows it would have to mop close to Rs.4.2 trillion in the last four months to meet the Budget Estimates.

  • Jan 10, 2018
  • Infosys sees a lower tax rate after signing pact with US IRS

    Infosys said it expects the overall effective tax rate for its American operations to be lower after it concluded an advance pricing agreement with the US Internal Revenue Service (IRS), on the methodology to allocate revenues and compute taxable income.The company said it expects the tax rate to be lower by about 100 basis points for future periods covered under the agreement, which covers the period between 2011 and 2021. The preliminary discussions for this agreement began in 2015.

  • Nov 29, 2017
  • GST collections drop sharply, CBEC puts transitional credit under scanner

    A sharp decline in the Goods and Services Tax (GST) collections in October has prompted the Central Board of Excise and Customs to assess the businesses’ use of ‘transitional credit’ to pay taxes more critically. The tax rate reductions on some 130 items till October too had an impact on the collections falling to just over Rs 83,000 crore in the month, down about Rs 10,000 crore from the average of the previous three months. The board expects a further decline in November revenue as over 200 items, including 178 that were previously under the highest slab of 28%, saw rate cuts in the middle of the month.

  • Oct 30, 2017
  • Indirect taxes collection could fall short of target due to GST

    Indirect taxes collection by the government may fall short of the target during the current financial year due to disruption caused by the GST rollout, Central Board of Excise and Customs (CBEC) chairperson Vanaja Sarna said on Sunday. For the fiscal year ending March 2018, the government had fixed a target of Rs 9.68 lakh crore for revenue collections from customs and GST. However, the CBEC chairperson said there was no plan to revise the revenue collection target for the year. The CBEC is the apex body for the administration of indirect taxes and forms part of the revenue department of the Ministry of Finance.

  • Sep 28, 2017
  • Massive amounts of revenue stuck in litigation, this is what the Narendra Modi government has ordered CBEC officers to do

    As the government struggles to realise a massive amount of revenue stuck in litigation, the Central Board of Excise and Customs (CBEC) has instructed its officials and field formations to proactively challenge pending or stayed cases related to the goods and services tax (GST) in high courts by way of filing special leave petitions (SLPs) in the apex court. The Supreme Court allows SLPs only if there is a substantial question of law of general or public importance involved, or if there is manifest injustice resulting from an impugned order or judgment. “Principally, all orders, whether interim or final, are appealable. Whether the levy of GST has been questioned or stayed, irrespective of the fact that matter is still pending before the High Court, the same needs to be challenged through SLPs before SC,” the board said while instructing its officials.

  • Sep 27, 2017
  • Indirect tax share in GDP at all-time high of 10.5%

    There has been a steady rise in indirect taxes (net of subsidies) in recent years, pushing up retail prices of commonly used goods and services.The combined share of Customs and excise duties, service tax, and value-added tax (VAT) in India’s gross domestic product (GDP) reached an all-time high of 10.5% during the financial year 2016-17, up from 7.7% three year ago. The previous high was 10.1% during the Rajiv Gandhi government in 1987-88.Experts say this could be one of the reasons for a demand slowdown in the economy, as higher indirect taxes raise retail prices, hurting demand as well as production.

  • Sep 27, 2017
  • Taxes on petro products fetch government Rs 2.67 lakh crore

    Crude oil prices in the international market have come substantially down, but surprisingly the prices of petroleum products in India are on the rise, pinching the common man's pocket. But then where is the huge money, being earned through several hikes in indirect taxes, going Well, according to the government's response to an RTI application, even as the money in the common man's pockets seems to have developed wings, it is the government coffers that are benefiting from the high prices of petroleum products.

  • Sep 23, 2017
  • Govt notifies new duty drawback rates from 1 October

    The government on Friday came out with modified duty drawback rates for exporters, evoking sharp reaction from the apparel industry which will witness reduction in tax refunds.The new all industry rates of duty drawback, the refund of duties on imported inputs for export items, will come into effect from 1 October.The new refund rates for garments will come down to 2% as compared to the 7.7% drawback available till now, said Apparel Export Promotion Council (AEPC) in a statement.

  • Jul 27, 2017
  • Governments free to levy certain other taxes

    The finance ministry on Tuesday said states can levy certain taxes under the new indirect tax regime as the GST Council did not have any authority to direct them against such a move. The ministry was replying to a question in the Rajya Sabha on whether the Goods and Services Tax (GST) Council was empowered to stop states from levying certain taxes. “Under the constitution, certain powers of taxation still remain with the state governments after introduction of GST also and within those powers, the state governments are free to decide their rates of taxation. These taxes include stamp duty and registration charges, VAT on potable alcohol, entertainment tax, electricity duty and taxes on vehicle,” the ministry said.

  • Jul 05, 2017
  • Maharashtra, Tamil Nadu raise taxes outside GST, Centre says they can

    Two state governments, Maharashtra and Tamil Nadu, have started imposing taxes outside the national goods and services tax (GST), something the Centre says they can do.The Centre says states may impose mandi (wholesale markets) tax and vehicle registration fee, besides raising entertainment tax beyond the GST rate.On Tuesday, the Maharashtra cabinet decided to raise the one-time registration fee on private two-wheel and four-wheel vehicles by two percentage points, for new ones registered in the state. This is to

  • Apr 22, 2017
  • Import duty waived for free medicines

    The Finance Ministry has exempted 27 medicines, which are supplied free of cost by pharmaceutical companies under their patient assistance programmes, from customs duty.Seventeen of these medicines are used in treatment of different kinds of cancers, including blood, prostrate and ovarian. High prices of chemotherapy drugs make cancer treatment unaffordable for many in India.Even as the government has been attempting to control prices of some of the cancer drugs listed under the National List of Essential Medicines, many of these continue to remain out of reach. For example, Halaven, from Eisai Pharmaceuticals, which is used to treat metastatic breast cancer, can cost about Rs.4.8 lakh for each cycle, with average treatment running over four cycles.

  • Apr 08, 2017
  • Indirect tax collection: All you want to know about stuck cases and rejected appeals

    The government’s indirect tax collection has been growing steadily over the years. Indirect taxes accounted for 5.2% of GDP and 48.8% of gross tax revenue in FY16. Even though government may be gaining ground in terms of what accrues from indirect taxes, tax-related litigations still remain a major concern. Apart from increasing service tax rates, the government has taken a lot of measures to widen the tax base, but a lot of its problems follow from stuck cases and rejected appeals.Budget data highlights that the amounts under dispute for indirect taxes (customs, union excise and service tax) was `1,05,463 crore at the end of reporting year FY16.

  • Mar 28, 2017
  • New board for indirect taxes to become operational from June 1

    The Central Board of Indirect Taxes and Customs (CBIC), which will replace the current CBEC, will become operational from June 1 in preparation for the Goods and Services Tax (GST) regime, an official source said. The Central Board of Excise and Customs (CBEC) is presently the top policy-making forum for indirect taxes in the country. “The CBIC will become operational from June 1. There will be no need for different commissionerates for service tax, central excise and others. There will be only one body — Commissionerate for GST,” a CBEC source told IANS.

  • Feb 20, 2017
  • Buying jewellery over Rs2 lkh cash to attract 1% TCS from Apr1

    Cash purchases of jewellery will attract 1 per cent TCS (tax collected at source) from April 1 if the amount exceeds Rs 2 lakh, as against the current threshold of Rs 5 lakh.Once the Finance Bill 2017 is passed, jewellery will be treated on par with general goods which attract 1 per cent TCS on cash purchase of above Rs 2 lakh.The Bill seeks to do away with the threshold of Rs 5 lakh on jewellery purchases for applicability of TCS because the Union Budget 2017-18 has proposed to ban cash dealings of over Rs 3 lakh and make violations punishable with a penalty of an equivalent amount to be paid by person receiving the cash.

  • Jan 10, 2017
  • Indirect tax mop-up rate slows after note ban, Jaitley dismisses slowdown

    Demonetisation slightly hit tax mop-up in December, with indirect tax collections growing 14.2%, down from 23.1% in November and 30.5% in October, showed data released by the finance ministry on Monday. October figures may be higher due to festival season as well.Only personal income tax collections bucked the trend partly due to change in the time schedule of payment of advance tax and partly due to better compliance after demonetisation.

  • Dec 12, 2016
  • Indirect tax assessments not to be reopened if turnover rises

    Revenue Department on Sunday said officials will not reopen the past assessments of excise and service tax of assessees even if their turnover in the current period increases on account of digital payments in the wake of demonetisation.In a circular to excise and service tax chief commissioners, the Central Board of Excise and Customs (CBEC) said there are “apprehensions” that an increased turnover because of use of digital modes of payment may lead to demands for the earlier period. “It is, hereby, clarified that in indirect taxes, past assessments will not be reopened for this reason alone,” the CBEC said.