India faces first fall in direct taxes

India’s corporate and income tax revenue is likely to fall for the first time in at least two decades, more than half a dozen senior tax officials told Reuters, amid rapid declines in economic growth and lower corporate taxes rate.

The government of Prime Minister Narendra Modi targeted for a direct tax collection of 13.5 trillion rupees ($189 billion) for the year ending March 31-a 17 percent rise over the previous fiscal year.

A sharp decline in demand, however, has forced companies to slash investment and jobs, dent tax collections, and prompted the government to forecast 5 percent growth for this fiscal year – the slowest in 11 years.

A senior tax officer said that the tax department was able to collect only 7.3 trillion rupees as at January 23, more than 5.5% below last year’s level.

In the final three months, authorities usually raise about 30 to 35% of annual Direct Taxes from businesses during advance for the first three quarters, according to estimates from the last three years.

Yet eight senior tax officials interviewed by Reuters said this fiscal year was likely to fall below the 11.5 trillion collected in 2018-19, despite their best efforts to steer tax collections.

“Forget about the target. That’s the first time we’re ever going to see the drop in direct tax collections,” a tax officer in New Delhi said.

He predicts that direct tax receipts will end up around 10 percent below fiscal 2019 for this year.

The government’s annual revenue projections usually account for around 80% of direct taxes, and the deficit will leave the government with the need to raise borrowing to meet its expenditure commitments.
Tax officials also say that another major reason behind the lenient tax collections is a surprise reduction in the top corporate income tax rate last year aimed at wooling the fabricators and raising investment in Asia’s third-largest economy.

“We will be very pleased if we can even breakeven with what we raised last year,” said another senior tax official in the financial capital Mumbai, the largest tax driver, which accounts for about a third of direct tax revenues.

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36th GST Council Meeting Updates – In Making of the EV Sector

The 36th GST Council Meeting happened on 27th July 2019 with the prime plan being – decrease of GST rates on Electric Vehicles. The meeting initially scheduled on 25th July 2019 must be conceded to a later date as the Chairperson and Union Minister of Finance and Corporate Affairs, Nirmala Sitharaman, was already busy with her duties in the parliament. The 36th GST council, assembled over Video Conference, has recommended the follows:

  • Decrease in the GST rate for Electric Vehicle Sector
  • Expansion to pick in for Composition Scheme

Boosting the Electric Vehicle segment in India

While trying to give a lift to the eco-friendly option in contrast to the automotive business, the GST board has prescribed GST rate cuts for Electric Vehicle part, as given underneath:

  • The GST rate on every electric vehicle will be decreased from 12% to 5%.
  • The GST rate on charger or charging stations for Electric vehicles will be decreased from 18% to 5%.
  • Hiring of electric buses (of carrying limit of more than 12 travelers) by nearby experts will be exempted from GST.

The Electric Vehicles Sector in India is still in a growing stage and the rate slash may give an even ground to the same to go up against its automobile partners. These adjustments in the GST rates for EV part will be put into impact from 1st August 2019 onwards.

GST updates for Composition Scheme

The GST council has broadened the timeframe for a taxpayer to opt in for composition scheme. The last date for filing of information in form CMP 02 has been moved from 31st July 2019 to 30th September 2019. In any case, such extension is available just for the service providers told under notice No. 2/2019-Central tax (rate) dated 07.03.2019 for a unique Composition Scheme.

Moreover, the due date for paying GST in CMP-08 (for the quarter April-June 2019) for all the composition vendors has been stretched out from July 31, 2019 to 31 August 2019. The extension will give both, the taxpayer just as the GSTN, the much necessary time to plan for form CMP 08 (which is yet to be included on the GSTN portal).

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GST, Customs Officials were charged For Helping In Smuggling Gold

The Central Bureau of Investigation has charged three Customs and GST authorities situated in Bengaluru for purportedly helping bootleggers get gold from Dubai the type of glue, authorities said on Tuesday.

The office had gotten data that Directorate of Revenue Intelligence authorities had captured six global travelers who were giving over snuck gold to certain collectors.

Amid examination, it was discovered that the gold was being carried as glue, which was covered up in the midsection belt by the dispatches, the office said.

The CBI asserted that on October 14, 2018, six bearers brought 11 kilogram gold costing Rs.3.67 crore which was seized by the Directorate of Revenue Intelligence authorities.

“It is found out that the runners convert gold into powdered structure and from there on blend the gold with certain substances and make it into a compound which physically will be as a glue. The glue is covered up in the midriff belt worn by the bearers,” the organization claimed.

It is affirmed that Rajnish Kumar Saroh, Superintendent of Central Taxes, GST; Sudarshan Kumar, the then Inspector of Customs at Kempegowda International Airport Limited, Bengaluru; and Shiv Kumar Meena, Inspector Customs, Air Intelligence Unit at the air terminal were submit gloves with the general population engaged with the pirating enabling them to go without any penalty.

Rajnish Kumar Saroh went into criminal connivance with the bootleggers situated in west Asia to let travelers bringing gold leave the Customs checking zone with no inconvenience, the office claimed.

The authorities were working in conspiracy with NT Jamsheer, who is the proprietor of Best Way Super Market in Bengaluru and was in contact with different runners and financial specialists situated in Dubai, the organization claimed.

Rajnish Kumar Saroh used to get Rs. 75,000 from Jamsheer while Rs. 15,000 was being paid to Sudarshan Kumar and Meena for every dispatch, the organization claimed.

The dealers chose travelers who were not in the speculate list and their subtleties were sent ahead of time to Jamsheer who passed them on to Rajnish Kumar Saroh, it said.

He purportedly checked traditions database and hinted Jamsheer whenever chose dispatches were in the rundown of suspects or not, the CBI asserted.

He likewise utilized administrations of Sudarshan Kumar posted at KIAL from August, 2017 to August, 2018 and from there on that of Shiv Kumar Meena in the connivance, CBI FIR has affirmed.

When leeway about dispatches was gotten from Rajnish Kumar Saroh, the runners sent them with illegal gold which was given up at the airplane terminal by the denounced authorities, the office affirmed.

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