INDIAN ECONOMY

honouring-the-honest-pm-modi-launches-platform-for-transparent-taxation

Honouring The Honest: PM Modi launches platform for Transparent Taxation

Prime Minister Narendra Modi, on 13 August 2020 at 11 a.m., launched the platform for ‘Transparent Taxation- Honoring The Honest’ via video conferencing. He underlined that the new reform will instill a sense of fearlessness among honest taxpayers who play an important role in national development.

The launch aims at initiating major tax reforms that would bring transparency in tax systems and empowering taxpayers.

The Income Tax Department carried out several major tax reforms in recent years. Last year the Corporate tax rates were reduced from 30 percent to 22 percent and for new manufacturing units, the rate was reduced to 15 percent. Dividend distribution Tax was also abolished.

In addition to a reduction in tax rates IT Dept emphasized on simplification of direct tax laws. Several initiatives were taken for bringing in efficiency and transparency in the functioning of the Department. This includes bringing more transparency in official communication through the newly introduced Document Identification Number (DIN) wherein every communication of the Department would carry a computer generated unique document identification number. 

Similarly, to increase the ease of compliance for taxpayers, IT Department has moved forward with the prefilling of income tax returns to make compliance more convenient for individual taxpayers. Compliance norms for startups too were made simpler.

With a view to providing for the resolution of pending tax disputes the IT Department also brought out the Direct Tax Vivad se Vishwas Act, 2020 under which declarations for settling disputes are being filed currently. To effectively reduce taxpayer grievances/litigation, the monetary thresholds for filing of departmental appeals in various appellate Courts were raised.

IT Department also undertook measures to promote digital transactions and electronic modes of payment. The IT department appeared keen on taking the initiatives forward and efforts were made to ease compliances for taxpayers during the Covid times by extending statutory timeliness for filing returns as also releasing refunds expeditiously to increase liquidity in the hands of taxpayers.

Today’s launch on Tax Reforms by the Prime Minister signifies that the journey of direct tax reforms would continue.

13 Aug 2020
sitharaman-reviews-capex-of-23-cpses-to-boost-expenditure-in-the-economy

Sitharaman reviews CAPEX of 23 CPSEs to boost expenditure in the economy

With Rs 1,65,510 crore as CAPEX target for 2020-21 Union Minister for Finance & Corporate Affairs, Nirmala Sitharaman, on Tuesday, interacted (via VC) with Secretaries of Ministries of Petroleum & Natural Gas, Power, Coal, Mines, Atomic Energy and with the CMDs of 23 CPSEs under these Ministries. The meeting was part of the series of meetings that the Finance Minister is having with various stakeholders to accelerate the economic growth.

In FY 2019-20, against the CAPEX target of Rs.1,64,822 crore for the 23 CPSEs, the achievement was Rs.1,66,029 crore i.e. 101%. Q1 (FY 2019-20) achievement was Rs.26,320 crore (16%) and achievement of Q1 (FY 2020-21) is Rs.20,202 crore (12%). CAPEX target for 2020-21 is Rs 1,65,510 crore.

While reviewing the performance of CPSEs, Sitharaman said that CPSEs have a very important role in giving a push to the growth of the Indian economy. She encouraged the CPSEs to perform better to achieve targets and to ensure that the capital outlay provided to them for the year 2020-21 is spent properly and within time. She said that better performance of CPSEs can help the economy in a big way to recover from the impact of Covid 19.

Sitharaman asked the Secretaries to closely monitor the performance of CPSEs in order to ensure capital expenditure to the tune of 50% of capital outlay by Q2 2020-21 and make plan for it. She stated that unresolved issues should be flagged immediately to the DEA/DPE for an immediate solution.

The Ministries/ CPSEs discussed constraints being faced by them due to COVID 19 like problems of availability of manpower, delay in imports, delay in payments by DISCOMs on the dues of CPSEs like NPCIL and NLC. Sitharaman stated that extraordinary situation requires extraordinary efforts and with collective efforts, we will not only perform better but also help the Indian economy to achieve better results.

08 Jul 2020
honouring-the-honest-pm-modi-launches-platform-for-transparent-taxation

Honouring The Honest: PM Modi launches platform for Transparent Taxation

By IndianMandarins 13 Aug 2020

Prime Minister Narendra Modi, on 13 August 2020 at 11 a.m., launched the platform for ‘Transparent Taxation- Honoring The Honest’ via video conferencing. He underlined that the new reform will instill a sense of fearlessness among honest taxpayers who play an important role in national development.

The launch aims at initiating major tax reforms that would bring transparency in tax systems and empowering taxpayers.

The Income Tax Department carried out several major tax reforms in recent years. Last year the Corporate tax rates were reduced from 30 percent to 22 percent and for new manufacturing units, the rate was reduced to 15 percent. Dividend distribution Tax was also abolished.

In addition to a reduction in tax rates IT Dept emphasized on simplification of direct tax laws. Several initiatives were taken for bringing in efficiency and transparency in the functioning of the Department. This includes bringing more transparency in official communication through the newly introduced Document Identification Number (DIN) wherein every communication of the Department would carry a computer generated unique document identification number. 

Similarly, to increase the ease of compliance for taxpayers, IT Department has moved forward with the prefilling of income tax returns to make compliance more convenient for individual taxpayers. Compliance norms for startups too were made simpler.

With a view to providing for the resolution of pending tax disputes the IT Department also brought out the Direct Tax Vivad se Vishwas Act, 2020 under which declarations for settling disputes are being filed currently. To effectively reduce taxpayer grievances/litigation, the monetary thresholds for filing of departmental appeals in various appellate Courts were raised.

IT Department also undertook measures to promote digital transactions and electronic modes of payment. The IT department appeared keen on taking the initiatives forward and efforts were made to ease compliances for taxpayers during the Covid times by extending statutory timeliness for filing returns as also releasing refunds expeditiously to increase liquidity in the hands of taxpayers.

Today’s launch on Tax Reforms by the Prime Minister signifies that the journey of direct tax reforms would continue.

sitharaman-reviews-capex-of-23-cpses-to-boost-expenditure-in-the-economy

Sitharaman reviews CAPEX of 23 CPSEs to boost expenditure in the economy

By IndianMandarins 08 Jul 2020

With Rs 1,65,510 crore as CAPEX target for 2020-21 Union Minister for Finance & Corporate Affairs, Nirmala Sitharaman, on Tuesday, interacted (via VC) with Secretaries of Ministries of Petroleum & Natural Gas, Power, Coal, Mines, Atomic Energy and with the CMDs of 23 CPSEs under these Ministries. The meeting was part of the series of meetings that the Finance Minister is having with various stakeholders to accelerate the economic growth.

In FY 2019-20, against the CAPEX target of Rs.1,64,822 crore for the 23 CPSEs, the achievement was Rs.1,66,029 crore i.e. 101%. Q1 (FY 2019-20) achievement was Rs.26,320 crore (16%) and achievement of Q1 (FY 2020-21) is Rs.20,202 crore (12%). CAPEX target for 2020-21 is Rs 1,65,510 crore.

While reviewing the performance of CPSEs, Sitharaman said that CPSEs have a very important role in giving a push to the growth of the Indian economy. She encouraged the CPSEs to perform better to achieve targets and to ensure that the capital outlay provided to them for the year 2020-21 is spent properly and within time. She said that better performance of CPSEs can help the economy in a big way to recover from the impact of Covid 19.

Sitharaman asked the Secretaries to closely monitor the performance of CPSEs in order to ensure capital expenditure to the tune of 50% of capital outlay by Q2 2020-21 and make plan for it. She stated that unresolved issues should be flagged immediately to the DEA/DPE for an immediate solution.

The Ministries/ CPSEs discussed constraints being faced by them due to COVID 19 like problems of availability of manpower, delay in imports, delay in payments by DISCOMs on the dues of CPSEs like NPCIL and NLC. Sitharaman stated that extraordinary situation requires extraordinary efforts and with collective efforts, we will not only perform better but also help the Indian economy to achieve better results.

fitch-retains-sovereign-rating-of-india-lowers-outlook-to-negative-from-stable

Fitch retains sovereign rating of India; lowers outlook to negative from stable

By IndianMandarins 19 Jun 2020

Amid a growing number of Coronavirus cases, Fitch Ratings agency has retained India’s sovereign rating at the lowest investment grade of “BBB-“, while it has revised downward its rating outlook for India to negative from stable. Fitch has cited increasing risk to India’s growth and debt outlook, as a reason for the above ratings.

Fitch stated that COVID-19 pandemic has significantly weakened India’s growth outlook for fiscal year 2021, simultaneously exposing challenges associated with a high public-debt burden. Although, the rating agency expects India’s economic activity to contract by 5% in the fiscal year 2021 before rebounding by 9.5% in fiscal year 2022.

rahul-interviews-rajan-strategy-to-make-1-and-1-as-11-

Rahul interviews Rajan: Strategy to make 1 and 1 as 11?

By IndianMandarins 03 May 2020

Rahul Gandhi interacting with former RBI governor Raghuram Rajan on India’s economy post-COVID-19 is certainly not out of the context rather makes a great sense. But Gandhi interviewing Rajan is something also certainly uncommon as it has some unique political overture.

It may be underlined that the ruling BJP has constantly been trying to corner Congress’ de-facto chief Rahul Gandhi by projecting him an over-rated leader beyond his limits and mocking him every now and then for his gestures and remarks.

Rahul is often termed in public as a sincere leader lacking consistency and seriousness in his approach. It is believed that Rahul’s move would have emanated from his strategy of image makeover especially at a time when the country, post-COVID-19 appears to be facing severe unemployment crisis and economic downturn. One can not deny the strategy that Rahul’s political stature and Rajan’s institutional credibility put together may add to Rahul’s image makeover.

direct-tax-collection-unrealistic-without-revision-who-is-to-be-blamed-

Direct tax collection unrealistic without revision: Who is to be blamed?

By Rakesh Ranjan 22 Apr 2020

The economy of the country is collapsing and it is unlikely that the government will be able to match the Direct Tax Collection even of any of the past three years’ tally. It is for sure going to remain lower than the past 3-4 year’s collection.

Director IT-Budget Mahesh Kumar has written to all principal chief commissioner of IT that the statistical growth rate for a region has been further moderated by averaging it out with the all-India targeted growth rate so as to narrow the gap between all-India growth and the target growth rate given to the region.

But in a changed scenario how tenable this tax recovery target will be that is a big question. The target set by the government in the budget for 2020-21 tax collection was Rs 13.19 lakh crore with almost one third from Mumbai only which is worst affected by COVID-19 halting every economic activity.

A senior IT official told Indianmandarins that CBDT should have revised the budget estimates as he feels meeting the budget target is unlikely and impossible. But now IT officials would be under immense pressure to go aggressive and target businessmen.

Another senior officer said that when there are already massive layoffs of employees, how would there be personal income tax collection? There will not be any salary revision in any sector with massive salary cuts. All these things should have been factored into by the CBDT but as per Pandey’s instruction, CBDT sent the letter with zone wise targets without realizing reality on the ground.

(By Rakesh Ranjan)

uncertainty-intensifies-amid-covid-pandemic-niti-aayog-vc-fears-gdp-slipping-to-zero-or-in-minus

Uncertainty intensifies amid COVID pandemic: NITI Aayog VC fears GDP slipping to zero or in minus

By IndianMandarins 29 Mar 2020

As various rating agencies are predicting GDP growth of India slipping between 2.5 percent and 3.5 percent but it could slip to zero or even negative in the first quarter due to the impact of countrywide lockdown imposed to contain the spread of the deadly Covid-19.

NITI Aayog vice-chairman Rajiv Kumar has said that while there is a chance that this may not happen since essential services are functioning and essential goods moving, the virtual shutdown of all other sectors of the economy could result in a zero or negative GDP growth. He further added ha however, everything depends on how long the economic curfew will last. But it is sure that the economy would be hit very hard during this quarter.

However, it is difficult to predict that what would happen beyond June as there is too much uncertainty but everything depends on the length, severity and spread of the pandemic. NITI Ayog ruled out the possibility of a recession as after June.

swamy-questions-fm-on-excise-duty-hike-on-petrol

Swamy questions FM on excise duty hike on petrol

By IndianMandarins 16 Mar 2020

In his latest tweet, Subramanian Swamy has questioned the prudence of Union Finance Minister on raising excise duty on petrol and diesel, calling this an astonishing move. Though known for speaking his mind irrespective of party line, this tweet comes as a clear embarrassment to the government, already facing questions on GDP and overall economy.

By: Neha Sharma

checking-coronavirus-first-step-to-deal-with-slowing-economy

Checking coronavirus first step to deal with slowing economy

By IndianMandarins 28 Feb 2020

Indian economy that has just started showing green shots is getting apprehensive to be impacted by spread of coronavirus but former RBI governor Raghuraman Rajan is of the view that the best solution for coronavirus shock is to contain its spread and worry about stimulus later.

Central bank can do very little to deal with it but more government spending would help. The priority of the government should be to convincing companies and households that the virus is under control.

Actually, coronavirus’ spread has the threat potent of pushing world economy toward its worst performance since financial crisis more than a decade ago. Economists from Bank of America Corp warned clients that they now expect 2.8% global growth this year which is weakest since 2009.

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