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Union Finance Minister Nirmala <keyword id="19916494" type="General" weightage="20" keywordseo="Sitharaman" source="keywords">Sitharaman</keyword> on Friday urged officers of the Central Board of Indirect Taxes and Customs (<keyword id="19908147" type="General" weightage="20" keywordseo="CBIC" source="keywords">CBIC</keyword>) to proactively address <keyword id="20283921" type="General" weightage="20" keywordseo="doubts" source="keywords">doubts</keyword> and concerns raised by the public and business community regarding taxes before they escalate into grievances. Speaking at the inauguration of the new <keyword id="22890667" type="General" weightage="20" keywordseo="GST-Bhawan" source="keywords">GST Bhawan</keyword> in Udaipur, Rajasthan, Sitharaman emphasized the importance of a preventive approach in handling tax-related issues. She highlighted that government officials should prioritize solving problems at the stage where they are mere doubts, rather than allowing them to develop into full-blown grievances. "Before addressing a grievance, if we spend time through outreach to clear the doubts and suspicions in their minds, those doubts won't escalate into grievances" said Finance Minister Sitharaman. Sitharaman also highlighted the significance of effective information sharing in this process. She suggested that by engaging in sector-wise outreach and addressing any doubts that arise, officials could prevent potential issues from turning into grievances. "I request that before grievances arise, we should definitely carry out outreach sector by sector. If there are any doubts in their minds after this and some changes need to be made accordingly, we can make those changes as well. So, more than anything else, we need to focus on information sharing" added Sithraman. The Finance Minister's remarks emphasized a shift towards a more communicative and responsive approach in tax administration, aiming to foster better relationships between the government and the business community while minimizing conflicts and misunderstandings. Union Minister Sitharaman is on a two-day visit to Udaipur, On Thursday the minister chaired a meeting to review the performance of nine Regional Rural Banks (RRBs) of the states of Gujarat, Maharashtra, Madhya Pradesh, Chhattisgarh and Rajasthan. The minister asked Regional rural banks (RRBs) to ensure easy credit to Micro, Small and Medium Enterprises (MSMEs). She asked the RRBs to become more customer-friendly and leverage their local connections to further improve performance. "All RRBs have devised customised MSME products aligning with cluster activities. However, they need to regularly review their credit portfolio in that segment", she said. She also highlighted that Sponsor Banks and RRBs must recognise the challenges that lie ahead, especially maintaining asset quality, expanding digital services, and ensuring robust corporate governance are the areas that require continued focus. SEE ALSO: <a href="https://www.businessinsider.in/business/auto/webstories/2024-tvs-jupiter-vs-honda-activa-6g-which-110cc-scooter-should-you-buy/slidelist/112730069.cms">2024 TVS Jupiter vs Honda Activa 6G – which 110cc scooter should you buy?</a> <a href="https://www.businessinsider.in/tech/how-to/how-to-add-music-to-instagram-profile/articleshow/112732934.cms">You can now add music to your Instagram profile – here's how</a> <a href="https://www.businessinsider.in/business/auto/news/audi-q8-facelift-launched-in-india-with-a-1-17-crore-price-tag/slidelist/112707701.cms">Audi Q8 facelift launched in India with a ₹1.17 crore price tag</a>

Sitharaman urges tax officials to prevent doubts from escalating into grievances

India has signed mutual recognition agreements (MRAs) with <keyword id="551085" type="General" weightage="20" keywordseo="customs-authorities" source="Orion">customs authorities</keyword> of seven nations and is actively pursuing negotiations for such pacts with other countries, a top official said. The Central Board of Indirect Taxes and Customs and the Federal Customs Service, Russia, this month signed the Authorised Economic Operator (AEO) MRA to provide reciprocal benefits to accredited and trusted exporters of both signatories in the clearance of goods by the customs authorities of the importing country. "The CBIC and the Federal Customs Service, Russia signed the <keyword id="21760232" type="General" weightage="20" keywordseo="Authorized-Economic-Operator" source="keywords">Authorized Economic Operator</keyword> (AEO) Mutual Recognition Agreement, which is a major <keyword id="20467509" type="General" weightage="20" keywordseo="trade-facilitation" source="keywords">trade facilitation</keyword> boost for Indian importers and exporters. While this is the 7th MRA that has been signed by <keyword id="20001024" type="General" weightage="20" keywordseo="indian-customs" source="keywords">Indian Customs</keyword>, negotiations are being actively pursued with many other Customs' administrations," CBIC Chairman <keyword id="159142" type="General" weightage="20" keywordseo="Sanjay-Kumar-Agarwal" source="Orion">Sanjay Kumar Agarwal</keyword> said in a communication to field formation. The AEO programme enables Customs administration to identify safe and compliant exporters and importers and to provide them with better facilitation. AEO MRA is already in place for seven countries, including Korea, UAE, Hong Kong and Taiwan.

India signs customs mutual recognition agreements with seven nations; Actively pursuing more, says CBIC chief

<keyword id="19896956" type="General" weightage="100" keywordseo="Swiggy" source="keywords" meta.keywordsubtype="org" meta.entityname="Swiggy" meta.hostid="261" meta.entityid="Swiggy">Swiggy</keyword>’s stock market debut has been awaited for a long time and recent reports suggest that the Bengaluru-based company is expected to raise more than USD 1 billion through its IPO. Reports also suggest that the company might soon file its draft red herring prospectus (DRHP) with the <keyword id="19901204" type="General" weightage="20" keywordseo="Securities-and-Exchange-Board-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Securities and Exchange Board of India" meta.hostid="261" meta.entityid="Securities and Exchange Board of India">Securities and Exchange Board of India</keyword> (Sebi), potentially launching its IPO as early as this week. Meanwhile, Swiggy has been busy implementing several notable changes across its operations, probably to gear up for its IPO. From changing leadership to expanding Instamart’s reach, let us take a look some changes implemented by Swiggy in the last few months. <h2>Leadership overhaul </h2> One of the most significant shifts has been at <keyword id="19939135" type="General" weightage="20" keywordseo="Swiggy-Instamart" source="keywords">Swiggy Instamart</keyword>, the company's quick commerce arm. Swiggy appointed <keyword id="22954620" type="General" weightage="20" keywordseo="Amitesh-Jha" source="keywords">Amitesh Jha</keyword>, a seasoned executive from Flipkart, as the new CEO of Instamart last month. This move marks the third leadership change for Instamart in just 18 months. As part of this transition, Phani Kishan, the outgoing head of Instamart, was announced to take on a broader role within Swiggy, overseeing the Central Growth unit and working closely with co-founder Sriharsha Majety on new initiatives. <h2>Expanding Instamart’s reach </h2> Swiggy Instamart has also been on an expansion spree, recently launching in 11 new cities across India, including Rajkot, Thrissur, and Kanpur. This expansion marks a strategic push into Tier 2 and 3 cities, broadening its customer base beyond metropolitan areas. The platform, which offers delivery of daily essentials in just 10 minutes, also said in a press release that it has seen encouraging results in these new locations. In Mangalore, for example, a new store achieved 1,000 orders in a single day faster than many larger cities. This localised approach, featuring partnerships with regional vendors, has enhanced Instamart’s appeal and efficiency in serving diverse customer needs. "Users across India already recognise the convenience Swiggy provides," Amitesh Jha said in a press release and added, "The enthusiastic demand from smaller towns and cities has been incredibly encouraging. Our expansion into these new locations marks a significant milestone, allowing even more people to experience the ease of having thousands of products—from everyday essentials to electronics and toys—delivered in just 10 minutes from both national and local brands." <h2>Changes in management </h2> Swiggy has also made notable changes in its management team recently. Himavant Srikrishna Kurnala, previously with Reliance Retail’s JioMart, was appointed as the head of product for Instamart earlier this year. His appointment is part of a broader strategy to strengthen the team ahead of the IPO. Other key hires include Mayank Rajvaidya, who has been named vice president of fruits and vegetables, and Manu Sasidharan, who joined as associate vice president of the FMCG category. These additions come in the wake of several high-profile departures from the company, signalling a recalibration of Swiggy’s leadership structure. <h2>Policy changes for restaurant partners </h2> Swiggy’s founder recently revealed that the decade-old startup partners with over 3 lakh restaurants today. And thus, when a policy change decision was announced that impacted restaurant partners directly, it made headlines. In a move to standardise its service fees, Swiggy extended its gross value service fee policy to restaurants in non-metro areas. This change, effective from August 14, involves charging a service fee on the gross value of orders, including GST and packaging fees. This adjustment was expected to lead to an increased commission for restaurant partners in smaller towns and cities. The policy shift aligns with the fees already applicable to restaurants in larger urban areas and reflects Swiggy’s efforts to streamline its revenue model. <h2>Converting into a public limited company </h2> To facilitate its upcoming IPO, Swiggy also transitioned from a private limited company to a public limited company. Earlier this year, Swiggy updated its name to <keyword id="23191546" type="General" weightage="20" keywordseo="swiggy-limited" source="keywords">Swiggy Limited</keyword>, removing the term 'Private' to better align with its public offering aspirations. This strategic move was intended to prepare the company for public investment and enhance its market presence. As Swiggy readies itself for its IPO, these changes underscore the company's commitment to growth, innovation, and adaptability. The upcoming listing marks a significant milestone in Swiggy’s journey, reflecting its ongoing evolution and strategic realignment in the competitive food delivery landscape.

Swiggy is preparing for its IPO soon: A look at some recent changes in the company

The government has extended the deadline for filing <keyword id="6354679" type="General" weightage="100" keywordseo="gst" source="Orion">GST</keyword> returns for the month of September by a day to October 21, the CBIC said on Friday. On Thursday, taxpayers faced a slow functioning of the GST portal, which was the last date for filing monthly GST returns for some taxpayers. Following that, the <keyword id="12579914" type="General" weightage="50" keywordseo="central-board-of-indirect-taxes-and" source="Orion">Central Board of Indirect Taxes and</keyword> <keyword id="6360806" type="General" weightage="50" keywordseo="customs" source="Orion">Customs</keyword> (CBIC) said that an extension of the due date was being considered. "The GST Implementation Committee of GST Council has approved the extension of the due date of filing GSTR-3B return for the month of September 2022, for the monthly filers, from 20th October 2022 to 21st October 2022," the CBIC tweeted on Friday. Monthly return and tax payment form GSTR-3B is filed in a staggered manner between the 20th, 22nd, and 24th of each month by taxpayers in different states.GST Network (GSTN) provides the technology backend for running <keyword id="6359833" type="General" weightage="50" keywordseo="goods-and-services-tax" source="Orion">Goods and Services Tax</keyword> (GST). <keyword id="6354512" type="General" weightage="50" keywordseo="infosys" source="Orion">Infosys</keyword> is the service provider for GSTN. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/rupee-falls-12-paise-to-82-91-against-us-dollar/articleshow/95003236.cms">Rupee falls 12 paise to 82.91 against US dollar</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/if-you-are-looking-to-add-sparkle-to-your-portfolio-this-diwali-here-are-ten-stocks-for-samvat-2079/articleshow/95007121.cms">If you are looking to add sparkle to your portfolio this Diwali, here are ten stocks for Samvat 2079</a>

Govt extends deadline for filing September GST return till Oct 21

<ul><li><keyword id="889983" type="General" weightage="20" keywordseo="uniform-kyc" source="Orion">Uniform KYC</keyword> is a process where digital customer records will be shared among various financial institutions seamlessly</li><li>It can reduce the burden of repeated <keyword id="167905" type="General" weightage="20" keywordseo="kyc" source="Orion">KYC</keyword> processes for the customer or the organisations</li><li>The new proposal is aimed towards removing the silos in KYC done by various <keyword id="6354241" type="General" weightage="20" keywordseo="financial-services" source="Orion">financial services</keyword> players in the country</li></ul>In a recent meeting led by Finance Minister <keyword id="129243" type="General" weightage="20" keywordseo="nirmala-sitharaman" source="Orion">Nirmala Sitharaman</keyword>, a proposal was submitted for uniform <keyword id="496371" type="General" weightage="20" keywordseo="know-your-customer" source="Orion">know your customer</keyword> (KYC). The new system could ensure a more efficient customer verification process and easier sharing of data between financial institutions. But, what is uniform KYC and how does it work? To understand this, we must decipher the challenges with the current system. Issues with the present KYC process The current KYC practices are not up to the mark in terms of being user-friendly or secure. The process is mandatory for many financial actions, including opening a bank account, investing in the stock market, or buying a life insurance policy. Yet the process is not smooth, to say the least. “KYC in India has always been complex. Financial institutions need to know who they are doing business with, and fraudsters are always trying to break the system,” says Paritosh Desai, Chief Product Officer, IDfy, a digital onboarding platform. There are currently three major issues with the current KYC regime. First, it’s expensive. Lenders have to constantly update their systems and processes to comply with the KYC guidelines and it is expensive to make these large-scale changes all the time. Second, it’s obtrusive. “No customer likes paperwork and strict KYC norms dictate that each borrower must submit the same 5 documents to multiple lenders if they are, for instance, applying for a loan across lenders to get the best offer,” says Deshpande. Third, the current process is inflexible. There is no scope for banks or any institution to alter the process depending on the risk profile or vintage of the customer. Hence, it leads to suboptimal user experience that leads to drop-offs and lower Net Promoter Score (NPS) or the likelihood of recommending a given platform. How can uniform KYC benefit you The freedom and ease of choice for consumers for financial services have been a key focus for regulatory bodies recently. “The honourable finance minister is taking progressive measures to help battle fraud while reducing friction,” says Paritosh. The process of uniform KYC will allow financial institutions to verify customers through a relatively simpler means with access to inter-usable, digital KYC records across the financial sector. This can eliminate the need to undergo the same KYC process multiple times for users like us. “The new proposal is aimed towards removing the silos in KYC done by various financial services players in the country,” says Rajat Deshpande, CEO &amp; Co-founder of FinBox, a credit infrastructure company. Currently, a similar process called the Central KYC Records Registry (CKYCR) has been available in the capital markets since 2016, wherein the investors need not go through multiple KYC processes for investing in various types of financial assets. “Through the uniform KYC customers don’t need to verify their documents repeatedly and it will lead to a time-saving benefit for them,” says Arpit Ratan, Co-founder &amp; CBO, Signzy, a fintech company. Uniform KYC will not just benefit customers but will be a win-win situation across the board. “The initiative enables interoperability of KYC records, facilitating customers to utilise verified information across multiple financial services. This in turn reduces the turnaround time for financial institutions and ensures consumer protection in the utmost manner,” says Rohit Taneja, Founder &amp; CEO, Decentro, an API banking platform. Therefore, the days of hassle getting your KYC verified at multiple financial institutions may finally be over if the proposal goes through.

Uniform KYC on the horizon! Here’s how the proposed process can ease the burden on customers and institutions

India's biggest tax reform, the <keyword id="6359833" type="General" weightage="20" keywordseo="goods-and-services-tax" source="Orion">Goods and Services Tax</keyword> (<keyword id="6354679" type="General" weightage="20" keywordseo="gst" source="Orion">GST</keyword>), completes its half-a-decade journey on June 30, with many hits and some misses, and also brought about a paradigm shift in use of technology to bring about tax compliance and making over Rs 1 lakh crore revenue collection every month 'a new normal'. A nationwide Goods and Services Tax (GST), which subsumed 17 local levies like excise duty, <keyword id="6355686" type="General" weightage="20" keywordseo="service-tax" source="Orion">service tax</keyword> and <keyword id="6370857" type="General" weightage="20" keywordseo="vat" source="Orion">VAT</keyword> and 13 cesses, was rolled out at the stroke of midnight on July 1, 2017. Under GST, a four-rate structure that exempts or imposes a low rate of tax of 5 per cent on essential items and top rate of 28 per cent on cars is levied. The other slabs of tax are 12 and 18 per cent. In the pre-GST era, the total of VAT, excise, CST and their cascading effect led to 31 per cent as tax payable, on an average, for a consumer. Besides, there is a special 3 per cent rate for gold, jewellery and precious stones and 1.5 per cent on cut and polished diamonds. Besides, a cess is levied on the highest tax slab of 28 per cent on luxury, sin and demerit goods. The collection from the cess goes to a separate corpus — Compensation fund — which is used to make up for revenue loss suffered by the state due to GST rollout. GST also represents an unprecedented exercise in fiscal federalism as the Centre and states come together in the GST Council to thrash out modalities for smooth functioning of the relatively new tax regime. The Council has met 47 times so far and have taken measures which made Rs 1 lakh crore <keyword id="4943720" type="General" weightage="20" keywordseo="gst-collection" source="Orion">GST collection</keyword> per month 'a new normal' and on course to take the figure to Rs 1.4 lakh crore every month. As the government releases the June GST collection numbers on July 1, it is widely expected that the collections will follow the past four months' trend and be around Rs 1.4 lakh crore. The collections had touched a record Rs 1.68 lakh crore in April 2022, it had for the first time crossed Rs 1 lakh crore mark in collections in April, 2018. On the 5th anniversary of GST, <keyword id="4336899" type="General" weightage="20" keywordseo="Central-Board-of-Indirect-Taxes-and-Customs" source="Orion">Central Board of Indirect Taxes and Customs</keyword> (CBIC) tweeted "GST subsumed multiple levies and cesses, reduced compliance burden, removed regional imbalances and inter-state barriers, and significantly increased the transparency and overall Revenue collection". Over the past years the Government has been proactively issuing circulars and clarifications to clear doubts regarding taxation under GST and ensure ease of doing business. More recently, the GST Council, in its 47th meeting in Chandigarh, has decided to ease compliance for small taxpayers who supply through the e-commerce platform. Such suppliers, who make only intra-state supplies, need not seek GST registration if their annual turnover is less than Rs 40 lakh in case of goods and Rs 20 lakh in case of supplies. To help tax officers in administration, GST Network, which provides the technological backbone for the indirect tax regime, has been using artificial intelligence and machine learning to dish out newer data and plug revenue leakages. Tax experts, however, seek a simpler structure for Goods and Services Tax, a structure which would ensure seamless flow of input tax credit through the entire supply chain without losses. BDO India Partner and Leader - Indirect Tax Gunjan Prabhakaran said “over the past five years, the GST law has evolved and mitigated several issues faced by the taxpayers through timely clarifications and amendments. "However, the GST Council and the Government should quickly address few other hardships faced by taxpayers in relation to unwarranted and excessive issuance of show cause notices (for reconciliations of financial numbers, grant of registration, etc) and introduce a robust, technology driven single assessment process, which would achieve the twin objective of ease of doing business and remove the cascading effect of taxes". AMRG &amp; Associates Senior Partner Rajat Mohan said in the last five years, GST law has matured at a fast pace. First, the focus was on compliance and technology; sooner than later, it moved gears, and taxpayers were posed to self-regulate the annual filings. "Now it seems the law has entered the next phase whereby litigation needs to be reduced by either replacing ambiguous tax laws or clarifying the practical application of technical issues. Businesses expect the government to resolve all sectoral issues like would BPO/KPO qualify as an intermediary, tax credit for capital expenditure on building, levy of GST on Extra Neutral alcohol (ENA) etc," Mohan said. While the GST administration has moved forward with alacrity, it is still a long way to go to achieve the full potential of GST and make it a true 'good and simple tax'. With petrol, diesel, ATF outside GST, a large part of the economy is still not covered by the indirect tax regime. Inclusion of petroleum products under the GST net, could reduce cost for companies, tax experts say. With emerging technology, there is emergence of newer asset classes like the virtual digital assets (VDA) or cryptocurrency. There is a need for clarity on whether they would be classified as supply of 'goods' or 'services' and what would be the tax rate on them. Tax rate rationalisation is something which would happen sooner or later. Current inflationary concerns may have derailed the plans to tweak rates and GST slabs, but it would eventually be a reality as both the Centre and states need revenues and lesser slabs would mean a simplified tax regime. Besides, the decision makers in the Council too have to work out a solution as state governments, from July 1, 2022, stare at a stoppage of compensation for revenue loss due to GST implementation. When GST was rolled out on July 1, 2017, states were promised a compensation, from the cess fund, for five years if their GST collection falls short of the 14 per cent compounded revenue growth. Most states have sought an extension to the compensation mechanism and a final decision is likely to be taken at the next GST Council meeting in Madurai in the first week of August. Abhishek Jain, Partner Indirect Tax, KPMG in India, said going forward, the Government can consider setting up of Central authority to resolve conflicting AAR judgements across states and consider doing away with anti-profiteering provisions freeing businesses to set prices. "Further, bringing petroleum and electricity under GST ambit will help prevent cascading and ensure further uniformity. Lastly, some checks can also be incorporated on system generated GST notices, so as to avoid any unnecessary harassment of taxpayers," Jain said. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/startups/news/startups-like-unacademy-vedantu-blue-stone-caratlane-go-physical-from-digital-as-pandemic-boom-ends/articleshow/92564319.cms">Startups go physical from digital as pandemic boom ends</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/indian-credit-card-users-spend-40x-more-than-debit-card-users-online/articleshow/92543305.cms">Indian credit card users spend 40x more than debit card users online</a>

GST had its hits and misses but made ₹1.3 lakh crore monthly tax, the new normal

If the new platform being developed gets completed, companies will get to know in advance when to move goods from factories or warehouses so that they can save the time of waiting at ports. 
 The platform, called the <keyword id="1726198" type="UNKNOWN" weightage="100" keywordseo="Swift-system">SWIFT system</keyword>, was introduced in April by the <keyword id="6361265" type="ORGANIZATION" weightage="100" keywordseo="Central-Board-of-Excise-and-Customs">Central Board of Excise and Customs</keyword> (<keyword id="117272" type="ORGANIZATION" weightage="100" keywordseo="CBEC">CBEC</keyword>), and would allow importers and exporters to file just one form at ports so that they can get clearance from all agencies including the <keyword id="6376343" type="ORGANIZATION" weightage="100" keywordseo="Food-Safety-and-Standards-Authority-of-India">Food Safety and Standards Authority of India</keyword>, <keyword id="6386816" type="ORGANIZATION" weightage="100" keywordseo="Drug-Controller-General-of-India">Drug Controller General of India</keyword> and Plant Quarantine and Wildlife Crime Control Bureau. 
 
The SWIFT platform, or Single Window Interface for Facilitating Trade, would also allow risk-based assessment at customs, while significantly cutting down on paperwork procedures and decreasing its time span that presently takes about six-seven days. 
 Delays in cargo clearance delays that happen at ports have been cited by many foreign investors as one of the key issues that form the obstacle in smooth <keyword id="44749" type="ORGANIZATION" weightage="100" keywordseo="Foreign-Direct-Investment">foreign direct investment</keyword> (FDI). 
 
As per World Bank data, India ranks 133 in ease of doing business ranking on the "trading across borders" parameter, which is mainly because of high-cost paperwork taking too much time. 
 
<a href="http://readmt.com/images/content/sized/images/content/articles/GTI_Mumbai3_high_1320_892_60.jpg">Image source</a>

A great new technology has been introduced to cut down on the massive export delays at ports

<keyword id="2974268" type="UNKNOWN" weightage="80" keywordseo="Illicit-market">Illicit market</keyword>, with respect to seven sectors of the <a href="http://www.businessinsider.in/searchresult.cms?query=manufacturing">manufacturing</a> industry, had led to a loss of Rs 32,239 crore to the exchequer during 2014, according to a report released by <a href="http://www.businessinsider.in/searchresult.cms?query=FICCI">FICCI</a>. 
 The <keyword id="6355001" type="CITY" weightage="80" keywordseo="FICCI">FICCI</keyword> report prepared by its Committee Against Smuggling and Counterfeiting Activities Destroying the <keyword id="34412" type="ORGANIZATION" weightage="80" keywordseo="economy">Economy</keyword> and titled “Illicit Market: A Threat to Our National Interest” released said the loss was inclusive of both indirect and <a href="http://www.businessinsider.in/searchresult.cms?query=direct+taxes+">direct taxes</a> -- Rs 34,020 crore and Rs 5,218 crore, respectively. 
 
According to the report, there was a loss of Rs 26,190 crore in 2012. 
 FICCI released its nine sector report titled 'Illicit Market: A Threat to Our National Interest' in Guwahati on Tuesday. This is a quantitative study evaluating the impact of illicit markets on various economic aspects of the <keyword id="6362048" type="ORGANIZATION" weightage="80" keywordseo="Manufacturing">manufacturing</keyword> industry, including sectors like <a href="http://www.businessinsider.in/searchresult.cms?query=FMCG">FMCG</a>, packaged foods and personal goods, computer hardware, automobiles, mobile phones, tobacco &amp; alcohol, and media and entertainment industry. 
 
The study found that the revenue loss to the <a href="http://www.businessinsider.in/searchresult.cms?query=central+government+">central government</a> due to illicit trade increased 49.8% to Rs 13,049 crore from 2011-12 to 2013-14. 
 
Amongst the various sectors, the maximum revenue loss was from counterfeiting and illicit trade is tobacco products—23% and Rs 9,139 crore. 
 When it comes to states, <keyword id="6354915" type="CITY" weightage="100" keywordseo="Assam">Assam</keyword> saw a significant growth in illicit trade in these sectors in the last couple of years. It was one of the fastest growing markets for illegal cigarettes and alcohol in the country. 
 
In 2014, illegal cigarettes accounted for more than 25% of the total cigarette market in the state. 
 
Assam's illegal market for alcohol too grew significantly in value terms, especially for IMFL and imported liquor. 
 "During the last twenty years, the volume of the counterfeiting activity has increased 100 times and the size of trade in counterfeited goods is 10% of the legal <keyword id="35028" type="ORGANIZATION" weightage="80" keywordseo="international-trade">international trade</keyword> (around 2% of the world's overall economic output)," said PC Jha, adviser, <keyword id="2974267" type="PERSON" weightage="60" keywordseo="FICCI-CASCADE">FICCI CASCADE</keyword>, and former chairman of the <keyword id="514301" type="ORGANIZATION" weightage="80" keywordseo="Central-Board-of-Excise-Customs">Central Board of Excise &amp; Customs</keyword>. 
 
Deep Chand, advisor to FICCI CASCADE and former Special Commissioner of Police, New Delhi, said: "In the past few decades, leading intelligence and law-enforcement agencies around the world have found conclusive evidence of the increasing involvement of terrorist organizations in counterfeiting, piracy and smuggling activities to fund their activities…The need of the hour is tangible actions to increase enforcement and to impose increased punishments." 
 
The study said that high state-level taxes like VAT and imposition of health cess on the legal cigarette industry is resulting in high prices for legal cigarettes, and this is the key reason for such an alarming growth of illegal cigarette industry in the state. 
 
Most of the manufacturers of such illegal <a href="http://www.businessinsider.in/searchresult.cms?query=cigarettes+">cigarettes</a> (mostly based in the surrounding states and in some northern states) evade the high central <keyword id="6356916" type="UNKNOWN" weightage="80" keywordseo="excise-duty">excise duty</keyword> and state taxes/cess and thus are able to offer their products to consumers at rock-bottom prices. Price of an illegal cigarette pack in Assam is a fifth of the price of a legal packet. 
 
According to the study, smuggled international contraband cigarettes contribute significantly to the alarming growth of the illegal cigarette industry in Assam. Assam shares a porous international border with Bangladesh. In addition, other states in the north-east also share a similar border with Myanmar, Bangladesh and China. Therefore, there is a sizeable influx of cheap king-sized smuggled cigarettes from across the border into Assam. 
 
These smuggled cigarettes are transported from Assam and other north eastern states to the rest of the country by air, bus and train, the report said. 
 
"Such illegal cigarettes defeat the tobacco control objectives of the government as they neither bear any health warnings required as per Indian laws nor have other mandatory declarations like MRP, date of manufacture or place of Manufacture. High VAT compared to the rest of the country and the recent imposition of health cess on cigarettes have also resulted in large-scale diversion of the cigarettes trade into the state," the report pointed out. 
 
(Image: Indiatimes)

Over Rs 39, 000 crore loss to exchequer in 2014 all thanks to illicit trade!

The <keyword id="6361265" type="ORGANIZATION" weightage="100" keywordseo="Central-Board-of-Excise-and-Customs">Central Board of Excise and Customs</keyword> (CBEC) brought some good news for local manufacturers of mobile phones, laptops, which will also give a boost to Prime Minister Narendra Modi’s ‘Make in India’ initiative. 
 
The apex indirect taxes body, CBEC, has said that only those manufacturing goods in India can enjoy a concessional 2% duty regime without availing of tax credit on inputs, not importers who will have to pay 12.5% countervailing duty. 
 
Apart from domestic mobile phones, laptops and tablets manufacturers, coal producers will also gain from this directive. 
 
Earlier, this advantage to local manufacturers was taken away by the Supreme Court judgement. In a case related to SRF Ltd, the top court had directed that importers could avail of lower duty regime if they did not take tax credits. 
 
Reportedly, this had risked plans of foreign investors such as Foxconn Technology Group and Softbank to set up manufacturing facilities in the country and had also placed at a disadvantage the existing plants of Samsung Electronics Co. and Huawei Technologies Co. 
 
"In case of mobile phones, appropriate duty would need to be paid on inputs to be able to avail the benefit of concessional rates on final products. Accordingly, assembly of parts alone may not be a beneficial proposition," Bipin Sapra, a partner at EY, told Economic Times. 
 
The Modi-led India government has been trying to boost domestic manufacture of electronic goods in view of large domestic market being serviced mainly by imports. 
The financial daily reported that India shipped in almost $37 billion worth of telecom instruments, computer hardware and peripherals, electronic instruments and components, and consumer electronics goods in FY15, a 14% rise over the previous year. 
 
A ET news report read t hat mobile phones attract excise duty of 1% and a 1% National Calamity and Contingency Duty if no central value added tax (CENVAT) credit on inputs used is claimed, while a 12.5% countervailing duty is levied on imported devices. 
 
"The government has reinforced its commitment to promoting manufacturing in India by restoring the duty incentives to manufacturers of certain commodities," Sapra told ET. 
 
(Image: Indiatimes)

Domestic mobile phones and laptops manufacturers get tariff advantage once again, thanks to CBEC

Lot of money in <a href="http://www.businessinsider.in/searchresult.cms?query=service+tax+refunds">service tax refunds</a> is stuck, hurting the cash flow of companies. But, the issue won’t be there any longer as the government is going to expedite refunds. 
 
The government wants to start afresh for <a href="https://www.google.co.in/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=3&amp;cad=rja&amp;uact=8&amp;ved=0CCgQFjACahUKEwjOiPvLqsHIAhVIjo4KHVRIAuY&amp;url=http%3A%2F%2Fwww.businessinsider.in%2FGST-Means-India-Is-Keen-On-Adopting-Global-Practices%2Farticleshow%2F45757825.cms&amp;usg=AF">goods and services tax</a>. 
 For this, the apex indirect taxes body, <keyword id="6361265" type="ORGANIZATION" weightage="20" keywordseo="Central-Board-of-Excise-and-Customs">Central Board of Excise and Customs</keyword>, is also working on an overhaul of the refund mechanism for the <a href="http://www.businessinsider.in/searchresult.cms?query=BPO">BPO</a>, IT and ITES sectors. 
 
Reportedly, indirect tax collections shot up 35.8% to Rs 3.24 lakh crore in the first six months of the current financial year. 
 
This is over 50% of the budgeted estimate as the government expected Rs 6.47 lakh crore collections from indirect taxes in 2015-16. 
 
When <a href="http://www.businessinsider.in/searchresult.cms?query=Narendra+Modi">Narendra Modi-led government</a> stormed into power, it had promised a stable tax regime and keeping back refunds was against that spirit. 
 The <keyword id="888634" type="UNKNOWN" weightage="20" keywordseo="Service-tax-refunds">service tax refunds</keyword> that are stuck are hurting the cash flow of companies. 
 
Exporters can claim refunds on duties paid on imported inputs used to manufacture goods. 
 
"Very encouraging move...This would aid liquidity for exporters and thereby their business," said Ajay Sahai, Director General and CEO of the Federation of Indian Export Organisations. 
 
(Image: Indiatimes)

Government wants clean slate for GST, to end pending service tax refunds

There will now be detailed manual scrutiny of <keyword id="6355686" type="COMPANY" weightage="100" keywordseo="Service-tax">service tax</keyword> returns of assesses based on risk parameters by the <keyword id="6361265" type="ORGANIZATION" weightage="100" keywordseo="Central-Board-of-Excise-and-Customs">Central Board of Excise and Customs</keyword> (CBEC), under revised 2009 guidelines. CBEC, the <keyword id="47209" type="ORGANIZATION" weightage="100" keywordseo="Finance-Ministry">Finance Ministry</keyword> said, has these revised guidelines, to come to effect from August 1, in view of the legal changes brought about by the Negative List based <keyword id="6383566" type="PERSON" weightage="100" keywordseo="Taxation">taxation</keyword> of services and administrative changes like creation of separate Commissionerates for Audit. 

	As per a CBEC circular, the detailed return scrutiny would be conducted in respect of such assessees whose total tax paid for 2014-15 is below Rs 50 lakh. 
 

	However, the assessees who are subject to service tax audits would not be covered under the detailed scrutiny programme. 
 

	"In an era of self assessment of tax liability by the assessees, compliance verification assumes greater importance. Scrutiny is one of the three prongs of compliance verification, the other two being audit and anti evasion," the Ministry said. 
 

	Prior to the reorganisation of Commissionerates, all these three prongs were being handled by a single Commissionerate. 
 

	With the creation of separate Audit Commissionerates, the Executive Commissionerates will focus on scrutiny and anti evasion work. 
 

	"The selection of returns for detailed scrutiny would be on the basis of risk parameters which would be centrally generated. The scrutiny would be entirely done in the departmental premises, based on assessment related documents obtained from the assesses," the ministry said. 
 

	The selection of the asseessees for the purpose of manual scrutiny, the CBEC circular said, would be made under three bands -- where the Service Tax is paid up to Rs 10 lakh, Rs 10-25 lakh and Rs 25-50 lakh in 2014-15. 

	 
	 
	(Image credits: Indiatimes)

Detailed manual scrutiny of service tax returns from August 1

<ul><li>The <keyword id="6557524" type="ORGANIZATION" weightage="20" keywordseo="central-board-for-indirect-taxes-and-customs">Central Board for Indirect Taxes and Customs</keyword> is proposing to tax earnings from cryptocurrency transactions at 18%. </li><li>Under the regulator’s proposal cryptocurrencies are to be designated as “intangible goods”. </li><li>This should a welcome relief for <keyword id="6354947" type="UNKNOWN" weightage="20" keywordseo="bitcoin">Bitcoin</keyword> traders and miners. By bringing digital currencies into the tax net, the government is legitimising trade in them. </li></ul>After months of confusion over their legal status, it seems the Indian government is planning to regulate the trading of digital currencies like Bitcoin and Ethereum under the Goods and Services Tax (GST) regime. The logic is simple - if people are making money from it, it is a taxable event. Anonymous sources told Bloomberg that profits from digital currency transactions could soon fall <a href="https://www.bloombergquint.com/gst/2018/05/23/india-mulls-gst-on-trading-of-virtual-currencies#gs.aaNCbqA">under the 18% tax slab</a> - the same rate as software and electrical devices - if the Central Board for Indirect Taxes and Customs (CBITC) has its way. This is a little less than the tax rate in the US, where traders are expected to pay 20% on their earnings if they’ve held their digital currency for longer than a year. Barring the tax level, details on how the trade of these currencies would be regulated in India weren’t revealed. And there is no clarity on their status as legal tender. However, the CBITC’s draft framework contained a number of key proposals. Firstly, cryptocurrencies are to be designated as “intangible goods” while the processes involving their mining, storage and transfer will be designated “services”. As a result, cryptocurrency exchanges will have to pay taxes on commissions earned. Secondly, the value of a cryptocurrency will primarily be denominated in rupees. Thirdly, transactions that involve a party outside India will designated as imports in the case of a purchase and exports in case of a sale. Finally, trading profits could be liable for retrospective <keyword id="6383566" type="UNKNOWN" weightage="20" keywordseo="taxation">taxation</keyword> from the date of the GST’s implementation - July 1st, 2017. This could result in quite a revenue haul for the government. In January, Reuters reported that trading volumes in India were increasing by about <a href="https://www.reuters.com/article/us-markets-bitcoin-india-taxes/india-sends-tax-notices-to-cryptocurrency-investors-as-trading-hits-3-5-billion-idUSKBN1F8190?utm_campaign=trueAnthem:+Trending+Content&amp;utm_content=5a63607f04d3013aee752148&amp;utm_medium=trueAnthem&amp;utm_source=twitter">₹20 billion every month.</a> A step in the right direction The news is likely a welcome relief for Bitcoin traders and miners. By bringing digital currencies into the tax net, the government is legitimising trade in them. It could also encourage more people to take part in the trading of these currencies. The next step after taxation, however, is preventing the misuse of digital currencies and tax evasion. Last month, the <keyword id="6354335" type="ORGANIZATION" weightage="20" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword> cracked down on cryptocurrency transactions, <a href="https://rbidocs.rbi.org.in/rdocs/PressRelease/PDFs/PR264270719E5CB28249D7BCE07C5B3196C904.PDF">barring any regulated entities like banks from facilitating them</a> after three months. The move was in response to concerns that money was being laundered through digital currency trades and the profits from such trades could be used to finance illegal activities. The order is currently <a href="https://www.bloombergquint.com/law-and-policy/2018/04/22/rbi-circular-barring-banking-service-for-virtual-currencies-challenged-in-court#gs.3TQyKdU">being challenged in court</a>. Should the proposal to tax cryptocurrency trading under the GST regime be approved by the <keyword id="6355040" type="ORGANIZATION" weightage="20" keywordseo="GST-Council">GST Council</keyword>, then it will likely cause the RBI to revoke its outright ban. This would be a win for the government, because if the formal banking system were to embrace cryptocurrency trading, it would bring these transactions right under regulators’ noses and away from the peer-to-peer unregulated market.

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