GST to ease loan access for millions of firms: Nandan Nilekani

GST - The implementation of Goods and Services Tax (GST) should drive nearly seven million small businesses to the formal digital economy and help them get easy access to loans, said Nandan Nilekani, the technology entrepreneur and co-founder of Infosys who was tapped by the government to run an ambitious identity-recognition programme, on Friday. 

The new unified taxation system, which is scheduled to be implemented later this year, will bring in millions of unorganised businesses on one platform. This would effectively, Nilekani believes, help them get loans using digitalised data.  

   

Nilekani pointed out, though the country has over 60 million businesses, fewer than one million are incorporated and only a few thousand are listed. A digital trail through GST would help these firms get access to formal credit at a much lower cost, which would help more small enterprises get into the formal economy.

Nilekani headed the empowered group on information technology infrastructure on GST.  

“Digitisation is the basis for credit and credit becomes the attractive reason for businesses to enter the formal economy,” he said, adding that ‘India’s formal economy is small and only 7 per cent of the India’s employment is in the formal sector(Read More)

Also Be Updated On: Budget 2017

Demonetisation, GST to fetch more revenues to govt: Arun Jaitley

GST - Finance Minister Arun Jaitley on Friday put up a spirited defence of demonetisation, saying the drive "shook" the financial system for a short while, but will integrate the shadow economy with the formal in the long run and ensure better tax compliance.

He said most contentious issues regarding the Goods and Services Tax (GST) have been sorted out between the Centre and states and the new indirect tax regime is at the final stages of implementation.

"This (demonetisation), coupled with GST, in the days to come will ensure much larger revenues as far as states and the central government are concerned and expand the size as far as the formal economy is concerned," Jaitley said at the CII Partnership Summit in Visakhapatnam.

Stating that India is largely a tax non-compliant society, he said states and the central government struggled with their revenues to run the system which created an unfair enrichment in favour of the evader.

"It also becomes very unfair on the normal taxpayer because what the evader manages to evade is what the compliant has to pay more," Jaitley said.

The government, therefore, decided to demonetise the high denomination currency, "which shook the system for some time".

Jaitley said demonetisation has gradually increased the process of integrating the shadow, parallel and informal economies in far greater number with the formal economy.(Read More)

GST Council: 70,000 tax officials warn of non-cooperation movement

Union Budget 2017 - Opposing some recent decisions taken by GST Council, various indirect tax officials' associations today decided to start non-cooperation movement.

To start with, the employees associations will not celebrate international customs day on Friday. Besides, they will observe 'black day' by wearing black badges on Martyrs' Day, i.e. January 30, as per minutes of meeting held among their representatives here.

The associations said that their members are "highly disappointed" and feel "cheated" over the decisions taken by Finance Minister Arun Jaitley-led GST Council in its meeting on January 16.

The Council had agreed to give states the powers to levy tax on economic activity within 12 nautical miles of territorial waters and to administer 90 per cent of the tax payers under Rs 1.5 crore annual turnover.

"We feel that the biggest tax reform of the century should have been in conformity with the principles of responsibility and authority going together and also in conformity with the Constitutional design. We feel that the decision shall weaken the Centre's ability to ensure its revenues.

"The decision will not only adversely affect the career of revenue officers but it is not in national interest. We oppose the decisions taken by GST Council and requests for deferment and review of above inappropriate and incorrect decisions," as per the minutes of meeting of steering committee of associations representing Group A, B and C employees of Central Board of Excise and Customs (CBEC).

The decision came after a meeting of representatives of Indian Revenue Service (Customs and Central Excise), All India Association of Central Excise Gazetted Executive Officers, All India Central Excise Inspectors' Association and All India Central Excise and Service Tax Ministerial Officers Association, comprising 70,000 personnel, here, office bearers said.(Read More)

KDK Softwares launches helpline number to resolve GST-related queries

GST Council - Ahead of the Union Budget, city-based tax solutions provider KDK Softwares has launched a toll-free number to resolve GST-related queries.

The company, which launched its 'GST Helpline' service recently, said it has received over10,000 calls with most of the callers inquiring about the new tax regime whether it will be beneficial for small businesses.

"Over 70 per cent calls received by the helpline had a single concern on GST rates and whether this will be a beneficial tax structure to small businesses," KDK Softwares CEO Mohit Bhambhani said here.

Queries of over ten thousands callers were studied, he said.

"About 80 per cent calls received were from the organisation having a business turnover below Rs 1 crore. Most of them were worried on the GST rates and how it will be levied on supply in case a company is supplying products directly to the end customers," he added.

With the recent demonetisation and upcoming GST regime, SMEs and startups are facing very challenging economic environment in addition to their experience of several highs and lows during the past five years, the CEO said.

But at the same time, understanding the importance of the SME sector, the central government has re-implemented Public Procurement Policy and also launched Make in India, Startup India and Skill India campaigns to promote the sector, he noted.

The company said its national toll-free helpline number 1800 103 9271 is available in 6 languages - English, Hindi, Gujarati, Marathi, Kannada and Malayalam.(Read More)

Revenue body asks FM not to implement GST in hurry; threatens legal action

GST - Claiming that demonetisation has affected country's growth, a major central revenue body has asked Finance Minister Arun Jaitley not to implement Goods and Services Tax (GST) in a hurry and threatened to take legal recourse in case their concerns are not addressed.

It termed as "illegal" certain decisions taken by Jaitley-headed GST Council and demanded a correction. It also sought that the officer's body be consulted before any final decision is taken.

The council in its meeting on January 16, had agreed to give states the powers to levy tax on economic activity within 12 nautical miles of territorial waters.

Also, it was decided that the states will have powers to assess and administer 90 per cent of the tax payers under Rs 1.5 crore annual turnover, while the remaining would be controlled by the Centre.

In a letter to Jaitley, the All India Association of Group B Central Excise Gazetted Executive Officers said the decision to transfer 90 per cent of service tax assessees to states is not supported by any lawful and logical base and therefore, the decisions taken by GST Council should be withdrawn immediately.

"Needless to say, any judicial intervention in the illegal decisions taken by GST Council, and if implemented by the Centre, would cause unnecessary delay in the implementation of GST.

"It is further added that due to demonetisation of old bank notes of Rs 500 and Rs 1,000, the GDP of the country is expected to fall at least 1 per cent (from 7.6 estimated to 6.6 per cent, as reviewed), and in case implementation of GST is delayed further, due to judicial scrutiny of the illegal decisions taken by GST Council, the country may suffer economically as the GDP may further slow down," it said.(Read More)