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<ul><li>The <keyword id="15478236" type="General" weightage="20" keywordseo="budget-2024" source="Orion">Budget 2024</keyword> will be tabled by the finance minister Nirmala Sitharaman on July 23.</li><li>The <keyword id="20081557" type="General" weightage="20" keywordseo="auto-industry" source="keywords">auto industry</keyword>’s expectations from the Budget 2024 include FAME 3 scheme, incentives for hybrids and more.</li><li>Here are the key expectations from the auto industry for the Budget 2024.</li></ul> The Budget 2024 is set to be tabled on July 23 by the finance minister Nirmala Sitharaman and like each sector, the Indian auto industry also has set a lot of expectations from the Narendra Modi-led government’s first budget of its third term. From a boost to electric vehicles to infrastructure development, the auto sector has a series of expectations that it hopes will be addressed in the upcoming budget. This article delves into the key budget expectations of the auto industry in India <h2>FAME 3 scheme</h2>The Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME 2) has been integral for the electric vehicle (EV) makers as it has helped keep EVs affordable for the common man. With the government<a href="https://www.businessinsider.in/business/auto/news/government-is-reportedly-reworking-the-fame-ii-scheme-to-ensure-companies-use-domestic-components/articleshow/93752352.cms"> reworking</a> the FAME 2 scheme and then<a href="https://www.businessinsider.in/business/auto/news/electric-scooters-get-a-price-hike-of-up-to-16000-as-fame-subsidy-ends/slidelist/109136771.cms"> ending the scheme</a>, the prices of EVs have increased. <div type="Article" hostid="261" msid="111573138" title="Union Budget 2024: When will it be presented, what time, where to watch and what are various sectors expecting?" mstype="2" mssubtype="0"></div> With Budget 2024, EV makers will look towards the government for the FAME 3 scheme. The government is expected to announce the FAME 3 scheme with an outlay of ₹10,000 crore. While the exact details of the scheme will only be known once the budget is announced, it will be aimed at boosting demand by subsiding the cost, while also promoting local manufacturing of key components. “In the upcoming budget, we advocate for initiatives and subsidy structures without segment caps which will in turn foster innovation and growth across multiple segments. Recent discussions surrounding the implementation of FAME 3 present a notable opportunity to enhance EV adoption in India,” said Niraj Rajmohan, CTO and Co-Founder, Ultraviolette. "Proposed measures to promote e-buses and enhance payment security are crucial for accelerating sustainable transportation. Comprehensive support for the entire EV ecosystem is essential. Anticipated policy reforms like FAME-III and increased funding for critical EV segments will foster holistic industry growth," said Kartikey Hariyani, Founder and CEO, Charge Zone. <h2>Petrol and diesel under GST</h2>One of the frequent demands recently has been to bring petrol and diesel under goods and services tax (GST) to bring the fuel prices under control. Oil Minister Hardeep Singh Puri has said that the government will try to bring petrol and diesel under GST. At present, the central government levies excise duty on petrol and diesel, while the state government imposes value-added tax (VAT) and sales tax. <h2>Incentives for hybrids</h2>While electric vehicles have long been subsidised by both state and central governments, hybrids have not received the same love. Union Minister Nitin Gadkari had earlier this year<a href="https://www.businessinsider.in/business/auto/news/gadkari-vows-to-eliminate-petrol-diesel-vehicles-in-india-bats-for-lower-tax-for-hybrid-cars/articleshow/108936085.cms"> pitched</a> for lower GST on hybrid vehicles. “The proposal to reduce GST on hybrid vehicles to 5% and to 12% for flex engines has been sent to the Finance ministry which is considering the requisition,” Gadkari said. Companies like Maruti Suzuki have a strong presence in hybrids and have a lot to gain from incentives, while companies like Tata Motors who do not have hybrid technology may take a hit on EV sales. With the government looking to reduce dependence on petrol and diesel cars, hybrids may finally get some incentives in the upcoming budget. The UP government has already started offering incentives to select hybrid cars. <h2><keyword id="22433272" type="General" weightage="20" keywordseo="vehicle-scrapping" source="keywords">Vehicle scrapping</keyword></h2>Industry bodies such as the Society of Indian Automobile Manufacturers (SIAM) have sought incentives for vehicle scrapping. These are vehicles that have crossed a certain age and are being scrapped keeping in mind the pollution. While a policy is already in place, the stakeholders are looking for increased incentives, especially for commercial vehicles such as trucks and buses, which account for most of the emissions. <h2>PLI scheme</h2>Automakers are also looking for increased incentives under the Production Linked Incentive (PLI) scheme, for both ICE and EVs. Companies want the scheme to be expanded to more components, including tyres, which have seen a lot of changes. SEE ALSO: <a href="https://www.businessinsider.in/stock-market/news/the-biggest-ipos-in-indias-history-lic-to-paytm-companies-that-have-raised-the-most-funds/articleshow/111690863.cms">The biggest IPOs in India’s history – LIC to Paytm, companies that have raised the most funds</a> <a href="https://www.businessinsider.in/business/auto/news/its-raining-discounts-maruti-suzuki-hyundai-tata-motors-and-others-offer-discounts-on-cars-as-sales-slowdown/articleshow/111688501.cms">It’s raining discounts – Maruti Suzuki, Hyundai, Tata Motors and others offer discounts on cars as sales slowdown</a> <a href="https://www.businessinsider.in/business/news/zomato-and-swiggy-increase-platform-fee-by-20-food-deliveries-to-get-costlier/articleshow/111758782.cms">Zomato and Swiggy increase platform fee by 20% – food deliveries to get costlier</a>

Budget 2024 Expectations: FAME scheme, aid for vehicle scrapping and other expectations of the auto industry

<ul><li>MSMEs hold immense potential in supporting India’s ambitious vision of a $40 trillion economy by 2047, says industry body Assocham.</li><li>Banks can fund <keyword id="6358354" type="General" weightage="20" keywordseo="msme" source="Orion">MSME</keyword> working capital requirements against <keyword id="4572080" type="General" weightage="20" keywordseo="GST-filings" source="Orion">GST filings</keyword>, suggests Assocham.</li><li>Another suggestion is to come up with a similar structure of REITs and InVITs, an investment trust that lends specifically to MSMEs via pooling.</li></ul>The micro, small and medium enterprises (MSME) sector has played a meaningful role in India’s growth. The sector holds immense potential in supporting India’s ambitious vision of a $40 trillion economy by 2047, says a report by industry body Assocham. However, the real struggle for small businesses lies in fundraising for future growth. The report highlighted challenges faced by MSMEs in terms of fundraising and recommended ways to solve the problem. “An April 2022 report by the Standing Committee on Finance estimated the credit gap in the MSME sector to the tune of ₹20-25 trillion. Therefore, funding via alternative sources apart from bank credit needs to be augmented for the MSME segment,” said the report. Given that nearly 60% of MSMEs raise funds through informal sources, formalization of the sector is necessary to facilitate growth, the industry body says. “To this end, banks could fund working capital requirements against GST filings, which are more reliable quantitatively, as compared to collateralized loans. This would not only enable MSMEs easy access to funds but also spur formalization through GST registrations,” Assocham said. Another suggestion is to come up with a similar structure of real estate investment trusts (REITs) and infrastructure investment trusts (InVITs). The industry body says that an investment trust that lends specifically to MSMEs via pooling – can be created. Disclosures a challenge with SME IPOs Apart from credit, small businesses also find it tough to raise equity. Raising funds by going public via <keyword id="5559702" type="General" weightage="20" keywordseo="SME-IPO" source="Orion">SME IPO</keyword> is also a challenge due to strict disclosure requirements. BSE SME Exchange was launched in 2012 while NSE launched SME Emerge platform and Nifty SME EMERGE Index in 2017 to encourage MSME companies to get public. “In November 2021, BSE also collaborated with the All-India MSME Association (AIMA) to encourage and promote the listing of MSMEs and start-ups through the SME platform. Although these steps helped overall resource mobilization in the initial years, evident from the gradual rise in number of MSMEs that have moved to the main board, we have not seen equity emerge as a source of MSME financing in a big way,” said the report. While tough disclosure remains a challenge, data shows that SME IPOs have witnessed good growth with hundreds of companies launching their issues with <a href="https://www.businessinsider.in/stock-market/news/small-is-the-new-big-sme-ipos-double-in-2022-while-mainboard-ipos-halve/articleshow/96618323.cms#:~:text=mainboard%20IPOs%20halve-,Small%20is%20the%20new%20big%3A%20SME%20IPOs%20double,2022%2C%20while%20mainboard%20IPOs%20halve&amp;text=In%202022%2C%20108%20SME%20IPOs,age%20technology%20IPOs%2C%20last%20year.">stellar performances</a>. In 2022, 108 SME IPOs were launched, as against 60 the year before. A net worth between ₹1 crore and ₹25 crore is one of the listing requirements for SME IPOs on BSE, as per BSE Stock Exchange. The minimum investment amount for an SME IPOs is quite large compared to regular IPOs – ₹1 lakh for SME IPOs versus nearly ₹15,000 for regular IPOs. The report also revealed that the Department for Promotion of Industry and Internal Trade (DPIIT) is in process of finalizing the new industrial policy, which amongst other things, encourages MSMEs to choose the corporate bond market. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/mutual-funds-raise-bets-on-mid-small-cap-stocks-amid-volatile-markets/articleshow/98516460.cms">Mutual funds raise bets on mid &amp; small-cap stocks amid volatile markets</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/fpis-continue-to-be-bearish-on-oil-gas-power-stocks-in-february-offload-equities-worth-7821-crore-in-the-two-sectors/articleshow/98511897.cms">FPIs continue to be bearish on oil &amp; gas, power stocks in February, offload equities worth ₹7,821 crore in the two sectors</a>

REIT-like structures, loans against GST filings can help solve MSME fundraising problems: Assocham

In the wake of shortage of funds, <keyword id="28504" type="General" weightage="100" keywordseo="kerala" source="Orion">Kerala</keyword>'s <keyword id="25455" type="General" weightage="80" keywordseo="finance" source="Orion">Finance</keyword> Department has capped <keyword id="6374832" type="General" weightage="80" keywordseo="treasury" source="Orion">Treasury</keyword> payments in the first month of the new fiscal. In its directive to the <keyword id="114127" type="General" weightage="50" keywordseo="treasuries" source="Orion">Treasuries</keyword> Director, the Department asked for the reduction of the ways and means limit from Rs 1 crore to Rs 25 lakhs with immediate effect. If there was a requirement for any payments to be made above Rs 25 lakhs, then special sanctions will have to come to effect. Till April 25, the Treasuries were allowed to pay bills up to Rs 1 crore. According to informed sources, the decision comes as the Kerala government is on a borrowing spree and is done to pay the salaries and pension to state government employees, besides paying of interests on earlier borrowed loans. Kerala appears to have gone 'broke' is on account of a delay in sourcing funds, they added. If borrowed funds do not return on time or if the GST compensation to the state does not come in time from the Centre, then the salaries and pensions to be paid in the first week of May might not happene. When the economist turned Minister of Finance, Thomas Isaac was at the helm of affairs during the first <keyword id="6356705" type="General" weightage="50" keywordseo="pinarayi-vijayan" source="Orion">Pinarayi Vijayan</keyword> government (2016-21), he deftly managed the poor state of finance through proper fiscal management and now with first-time legislator K.N.Balagopal as the Finance Minister, things appear a bit tough. Incidentally the total outstanding public debt of Kerala had skyrocketed after Vijayan took over and it now stands at above Rs 3 lakh crores. Outstanding debts is the sum total of public debt which consists of internal debt, loans and advances from the Centre besides loans from financial institutions such as LICA and special securities and not to mention of borrowings from deposits in state PF, treasury, pension funds and insurance. To get a clearer picture of the debt, it is best highlighted as a ratio of the size of the state economy/state gross state domestic product (GSDP). A comparison of the national picture of states and union territories with the highest debt GSDP ratio in 2022 are Arunachal Pradesh 57.4 per cent, Jammu and Kashmir Kashmir 56.6 per cent, Punjab 53.3 per cent, Nagaland 44.2 per cent, Himachal Pradesh 43.4 per cent, Rajasthan 39.8 per cent, Meghalaya 39.2 per cent, West Bengal 38.8, per cent Kerala 38.3 per cent and <keyword id="37102" type="General" weightage="50" keywordseo="andhra-pradesh" source="Orion">Andhra Pradesh</keyword> 37.6 per cent. One thing which has to be noted is the present staggering figure of the outstanding debts of Kerala did not happen overnight and successive state governments to a certain extent can take credit for the achievements of the state in the fields of education and health, which leads the rest of the country and to reach here, investment is required, but looking deeper into it experts revealed the real situation. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/investment/news/telegram-users-can-now-send-crypto-payments-to-each-other/articleshow/91170010.cms">Telegram users can now send crypto payments to each other</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/careers/news/ongc-is-hiring-over-3600-apprentices-with-a-maximum-stipend-of-9000-per-month/articleshow/91169869.cms">ONGC is hiring over 3,600 apprentices with a maximum stipend of ₹9,000 per month</a>

Kerala government caps treasury payments in the wake of fund shortage

Top telcos from the country have asked the government to introduce uniform rate across states and union territories (UTs), capping them at 15%, before finally going ahead with the goods &amp; services tax (GST) regime. 
 
As per these telcos, a rate higher than that would drive up cost of provisioning services, which would hurt both prepaid and postpaid consumers as they would have to pay more. 
 
As of now, the circle boundaries are not synced with geographical borders of states/UTs in several cases. If this doesn’t happen, it could result in tax complications in some big markets because of differential rates within the same circle. 
 
"We've recently told the finance ministry that it is imperative to have a uniform tax rate for telecom services across states/UTs, and a failure to do so could lead to a surge in consumer complaints as differential tax rates would impact the talktime pricing within a circle," Rajan Mathews, director general, Cellular Operators Association of India (COAI) told <a href="http://economictimes.indiatimes.com/news/economy/policy/telcos-seek-uniform-gst-rate-across-india-cap-at-15-per-cent/articleshow/53482817.cms">ET</a>. 
 
He added that COAI is working with E&amp;Y India so that it can identify potential irritants in GST regime for telecom. 
 
<a href="http://hightechforum.org/wp-content/uploads/2014/09/shutterstock_97609325.jpg">Image source</a>

Telcos want to cap GST rate at 15% across India

New Delhi, Jan 15 () Industry chamber Assocham on Wednesday urged the government to reduce GST rate by 25 per cent across the board for the next six months with a view to boost investment and demand.
The industry body said that it is not the time to worry about widening fiscal deficit as in the current circumstances, deficit financing will not be in an issue.
"The first radical suggestion is that GST rate should be cut across all slabs by 25 per cent for the next six months in order to kick start the economy.
"It will mean an additional deficit of Rs 1.20 lakh crore, which obviously will increase fiscal deficit.....but in the circumstances of today, deficit financing will not be an issue," Assocham President Niranjan Hiranandani told reporters here.
He said that the move will encourage more businesses to pay tax, which will lead to generate more revenue due to expansion of the tax base.
Such steps would help in achieving the target of USD 5 trillion GDP, he added.
"We need to solve the unemployment problem of India along with GDP growth. GDP growth alone is not enough for India. It has to be inclusive. Our suggestions are in line with this fact," he said.
Hiranandani also said that fuel should be brought under the ambit of GST and the option for availing input tax credit should be available to all the businesses, so that the credit chain does not get blocked.
He also suggested that most NBFCs are under a huge liquidity crunch, which has a direct impact on the economic activities, resulting in a financial pressure and slowing down of businesses.
The finance minister, with support from the RBI, needs to create a professional panel to address the situation on a war footing, the president said.
"Allow large non-banks to convert into banks. They will be able to serve their target clientele (MSMEs, informal sector etc) and promote nationalist banks with initial ownership of even 100 per cent to be reduced gradually to 26 per cent over a given period of time," he said.
On direct taxes, he suggested the government that the maximum cap of tax rates for the salaried individual should be kept at 25 per cent, keeping in mind the reduced corporate tax rates.
"All allowances and deductions for example conveyance etc should be indexed as per cost of inflation notified for capital gains, since the date of their introduction".
On the agriculture sector, he said that corporates should be allowed to do contract farming and to infuse high-end technology in farming, there is a need to create technology up-gradation fund for agriculture to provide capital subsidy.
On telecom sector, the Assocham president said that it is absolutely imperative to address the AGR issue to ensure the continuity of business, and investment in the sector.
"Telecom Sector has been going through financial stress in the last 3 years. The recent AGR judgment has further aggravated the stress and lead to an unprecedented financial crisis," Hiranandani said.
Similarly for the real estate sector, he recommended that the banks and financial institutions should be given discretion to one time restructuring and/or roll over of their existing loans to the sector on the lines of loans to other segments.
When asked, whether the ongoing protests will dent investments, he said "I do not agree" as investors are looking at India in a positive manner. RR CS BAL

Assocham for cut in GST rates by 25 pc across board

<ul><li>Policy analysts feel that the reform agenda has taken a back seat to political issues during Prime Minister Narendra Modi’s second term in office.</li><li>However, they believe small changes — like caps on foreign direct investment (FDI) and fixing the goods and services tax (GST) — can be made without "generating a lot of heat and tension".</li><li>The Indian economy has gone from being one the fastest growing in the world to hitting stagflation in a matter of months.</li></ul>Narendra Modi’s second term as India’s Prime Minister has been fraught with <a href="https://www.businessinsider.in/tech/news/caa-internet-shutdowns-make-india-example-for-china/articleshow/72931761.cms">protests</a> and <a href="https://www.businessinsider.in/politics/india/news/shiv-sena-chief-uddhav-thackeray-sworn-in-maharashtra-chief-minister/articleshow/72280034.cms">political tension</a>. With the <keyword id="6360189" type="ORGANIZATION" weightage="20" keywordseo="union-budget">Union Budget</keyword> 2020 around the corner, many are wondering what the central government’s vision is for reforms in the coming year. Policy analysts at the Raisina Dialogue 2020 feel the government may be a little distracted. However, despite political issues, there is room for reform without upsetting too many feathers. "I think what has happened in the second term, as far as perception goes, is we sense that the administration has gotten distracted with the political issues than the reforms issues and then economic issues," said Bharath Gopalaswamy, Senior Fellow at the Observer Research Foundation (ORF) India on the sidelines of <a href="https://www.facebook.com/ORFOnline/videos/603178493797939/">Raisina 2020</a>. India went from being the world’s fastest-growing economy to hitting stagflation <a href="https://www.businessinsider.in/policy/economy/news/indian-economy-went-from-worlds-fastest-growing-to-stagflation-in-just-a-few-months/articleshow/72500016.cms">in a matter of months.</a> Retail inflation is on the rise, factory output is nowhere close to its targets, and some industries in the sector are on a negative growth trajectory. Analysts predict that the country’s economic growth is <a href="https://www.businessinsider.in/business/news/indias-economic-growth-likely-to-remain-subdued-in-near-future-report/articleshow/72330188.cms">likely to stay subdued</a> in the future as the slowdown deepens. However, <a href="https://www.facebook.com/ORFOnline/videos/603178493797939/">Richard M. Rossow</a>, senior adviser of US-India policy studies at the Center for Strategic and International Studies (CSIS), believes the government still has a few some options — like removing restrictions on FDI, fixing the goods and services tax (GST) and simplifying bankruptcy procedures. Nursing the economy back to health through FDI "I think there’s room to do some reforms that won’t take as much political will. Look at FDI [foreign direct investment] caps — 21 years ago, any FDI cap was a political hot potato. And now, the government’s opening up defense, retail and insurance — and the blowback against doing that has been relatively minor," Rossow said. According to the Department of Promotion and Industry and Internal Trade (<a href="https://economictimes.indiatimes.com/news/economy/policy/india-hopes-to-continue-fdi-growth-story-in-2020/articleshow/73041537.cms?from=mdr">DPIIT</a>), the inflow of foreign investment has not been impacted by the slowdown. However, not all sectors in the Indian economy are open to 100% FDI — a few are still completely restricted. "There are about 20 other sectors that still have FDI restrictions. Without major blowback or opening up most of those, the potential quick injection of new money by foreign investors is relatively easy," explained Rossow. Life insurance companies are already lining up government lobbies to <a href="https://www.businessinsider.in/business/news/life-insurers-bat-for-100-pc-foreign-investment-in-sector-via-automatic-route/articleshow/72874288.cms">increase automatic approval</a> from 49% to 100%. Investment under the automatic route does not require prior approval from the government. On the other hand, the government is looking to <a href="https://www.businessinsider.in/business/news/dpiit-to-soon-issue-clarification-on-26-pc-fdi-in-digital-media-sector/articleshow/72963869.cms">cap investments in digital media companies</a> to 26% leaving foreign websites with 100% investment, confused. Dealing with debt and fixing tax regimes Aside from FDI, Rossow believes that the smaller steps like fixing issues with the goods and services tax (GST) and bankruptcy code can also be implemented without "generating a lot of heat and tension". Simplification of the GST is also a reform suggested by Indian economists for the upcoming <keyword id="6358021" type="ORGANIZATION" weightage="20" keywordseo="budget">budget</keyword>. Indian mobile makers are also looking for <a href="https://www.businessinsider.in/tech/news/budget-2020-indias-mobile-phones-makers-fear-for-jobs-in-the-face-of-fewer-incentives-and-global-competition/articleshow/73261138.cms">a reduction of GST on parts and accessories</a>. When it comes to the banking sector, sources told <a href="https://www.businessinsider.in/business/news/govt-unlikely-to-announce-capital-infusion-for-psu-banks-in-budget/articleshow/73105942.cms">PTI</a> that the government has no plans of capital infusion and is, instead, looking at encouraging banks to expedite the recovery of bad loans. However, that’s easier said than done. "Currently there are a lot of defaulters and banks that are underwater because of this ‘bad lending’, so to speak. But you also run the risk of excessive regulation and excessive scrutiny. You want to protect the regulator yet at the same time, somebody who has good credit should be able to get loans easily rather than pay the price for someone who will willfully default," explains Gopalaswamy. The haziness around the National Company Law Appellate Tribunal (NCLAT) and its dealings with the Indian Bankruptcy Code; is also posing hurdles. "We [private sector] are dealing with the Indian Bankruptcy Code and we’re dealing with the NCLAT process. And, the process is so cumbersome. At some levels it’s opaque and it’s still evolving. So the uncertainty as a foreign company trying to buy an Indian company or do a joint venture is still not the easiest process out here," he added. See also: <a href="https://www.businessinsider.in/tech/news/budget-2020-indias-mobile-phones-makers-fear-for-jobs-in-the-face-of-fewer-incentives-and-global-competition/articleshow/73261138.cms">Budget 2020: India’s mobile phones makers fear for jobs in the face of fewer incentives and global competition</a> <a href="https://www.businessinsider.in/defense/news/indias-budget-allocation-for-defence-has-remained-fairly-static-for-the-past-five-years/articleshow/73153930.cms">Budget 2020: Five charts that explain what you can expect from India’s defence expenditure this year</a> <a href="https://www.businessinsider.in/defense/news/indian-army-versus-military-spending-on-other-countries/articleshow/73182937.cms">Here's how the budget allocation for Armed Forces in India stacks up on the global scale</a>

Budget 2020 aside, these are some of the reforms that India can execute without causing political 'heat and tension'

New Delhi, Dec 9 () The Central GST collection fell short of the budged estimate by nearly 40 per cent during the April-November period of 2019-20, according to the data presented in Parliament on Monday.
 The actual CGST collection during April-November stood at Rs 3,28,365 crore while the budgeted estimate is of Rs 5,26,000 crore for these months, Minister of State for Finance Anurag Singh Thakur said in a written reply in Lok Sabha.
 The minister added that the data was, however, provisional.
 In 2018-19, the actual CGST collection stood at Rs 4,57,534 crore as against the provisional estimate of Rs 6,03,900 crore for the year, he said.
 In 2017-18, the CGST collection was Rs 2,03,261 crore.
 The minister said that as many as 999 cases were registered till October in the current fiscal for GST evasion and Rs 8,134.39 crore has been recovered.
 During 2018-19, a total of Rs 19,395.26 crore were recovered (1473 cases) and in 2017-18 the recovery was of Rs 757.81 crore (148 cases).
 For strengthening monitoring tools to prevent GST evasion, emphasis has been laid on system based analytical tools and system generated intelligence, Thakur said.
 "In this connection, the Directorate General of Analytics and Risk Management(DGARM) has been set up by the CBIC. Further, E- way bill squads have been activated for the purposes of random verification of the goods in transit," he said.
 The minister also informed the house that it has inserted a new CGST rule which puts restriction that the input tax credit (ITC) availed by a taxpayer shall not exceed 20 per cent of the eligible credit available in respect of invoices or debit notes.
 The capping of ITC would lead to reduction in cases of fraudulent ITC availment as well as increase in payment of tax through cash thereby boosting GST collection, Thakur said further. KPM KPM MR
MR

Central GST falls short of budget estimate by 40pc in Apr-Nov

New Delhi, Mar 12 () GST officers will soon come out with measures to check valuation of exports and device a standard operating procedure (SOP) for physical spot verification of risky taxpayers, in order to plug loopholes and check evasion. In the National GST Conference of Commissioners of State Tax and Zonal Chief Commissioners of Central Tax held last week, tax officials also decided to further examine steps that could be taken to stop new taxpayers from availing input tax credit (ITC). It was also decided that GST officers would come out with SOPs for physical spot verification of risky taxpayers and for blocking and unblocking of ITC. Measures to check export valuation, including capping of value for calculating export benefits and incentives, were also discussed and proposed for further examination, an official statement said. During the meeting, states like Rajasthan, West Bengal, Odisha, Gujarat and Punjab made presentations on best practices followed by them in compliance management and revenue augmentation in their tax administration. The Central Board of Indirect Taxes and Customs' GST policy wing presented various measures in the pipeline for increased compliance management and revenue augmentation. The focus of the GST officers has been to check evasion, and the investigation wing in commissionerates has in the recent past busted rackets of firms fraudulently claiming ITC. During the April-January period of the current financial year, GST collection stood at Rs 10.19 lakh crore, down from Rs 11.7 lakh crore in the year-ago period. JD HRS

GST officers to take steps to check export valuation, devise SOP for verification of risky taxpayers

<keyword id="6359833" type="ORGANIZATION" weightage="100" keywordseo="Goods-and-Services-Tax">Goods and Services Tax</keyword> (GST) is the biggest tax reform introduced in India since independence, and is certainly a game changer. However, the process undertaken by the government to implement GST was no less than a game changer itself. 
 
Several aspects had to be taken care of, and the most important part of the whole process was to stay focused on the bigger picture, not bowing down to the political and administrative negotiations that came with it. 
 
It was <a href="http://www.businessinsider.in/topic/Narendra-Modi">PM Narendra Modi </a>who was the leader of the process, along with finance minister <keyword id="42575" type="PERSON" weightage="100" keywordseo="Arun-Jaitley">Arun Jaitley</keyword>, who served as the bridge between him and the stakeholders. 
 
How often does it happen that the key members of the leading party of world’s biggest democracy meet up with the opposition leaders and that too a month after losing elections in a key state. However, it was the commitment that BJP had for GST that made him, along with Jaitley and parliamentary affairs minister Venkaiah Naidu had a meeting with former PM Manmohan Singh and Congress President Sonia Gandhi, a month after BJP lost Bihar elections. 
 
The PM, sources say, said that India needed GST and then the FM took over, explaining to the opposition why their positions, like capping tax rate at 18% in the GST statute, had to be reconsidered. He added that while a poor GST was not an option, their other demands will be duly considered. 
 
Also read: <a href="http://www.businessinsider.in/removal-of-cesses-for-gst-would-cost-government-rs-65000-crore/articleshow/57793686.cms">Removal of cesses for GST would cost government Rs 65,000 crore</a> 
 Ever since then, the <keyword id="117924" type="UNKNOWN" weightage="100" keywordseo="GST-Rollout">GST rollout</keyword> became a big puzzle with several tangled knots, which could be and was solved keeping in mind one thing, that GST was too big a reform to fail. The idea was to unite the country in a fundamental way, and before a deadline but only after clearing every doubt that anyone had. 
 
As per officials that <a href="http://economictimes.indiatimes.com/news/economy/policy/how-modi-government-managed-to-solve-the-gst-puzzle/articleshow/57980627.cms">ET </a>contacted, Modi referred to GST as more than a tax reform at Cabinet meetings, exemplifying India's "unity in diversity," asking his team to prioritise GST. The FM, very smartly negotiated the terms so that political rivalries didn’t hinder the implementation process. 
 
In total, <a href="http://www.businessinsider.in/gst-council-clears-almost-allrules-except-for-remaining-four/articleshow/57959857.cms">GST council </a>had 12 meetings; however, from the second meeting itself, there were signs of political bitterness raising its head, which is why the government decided to seek consensus and encourage everyone to offer solutions. 
 
While taking care of the taxation, the government had to get into intense detailing with the tax administration, which is when it demonstrated that it had no intention of cornering states. 
 
Also read: <a href="http://www.businessinsider.in/markets/economy/gst-to-keep-an-eye-on-your-perks-outside-ctc/articleshow/57889157.cms">GST to keep an eye on your perks outside CTC</a> 
 
In the whole process, the leading party is said to have never shied away from reaching out to rivals, just so the GST could be passed without fail. It involved reaching out to CPM's Sitaram Yechury, SP's Ram Gopal Yadav, TMC's Derek O'Brien, BJD's Dilip Turkey, NCP's Praful Patel, and several other point-persons from <a href="http://www.businessinsider.in/politics/delay-in-implementing-gst-during-nda-government-led-to-rs-12-lakh-crore-loss-says-congress-party/articleshow/57892537.cms">Congress party</a>. 
 
The PM had a message for his team working on GST, which was to work at top speed without compromising with the quality. The team included hundreds of officials spread in small groups, solving difficult questions of both producing and consuming states and working for a period of more than eight months, including holidays and weekends. 
 
"It took us several months and many informal discussions to reach a consensus on how the final draft should look like," said a top official. 
 
Also read: <a href="http://www.businessinsider.in/no-gst-for-education-and-healthcare-this-year/articleshow/57972964.cms">No GST for education and health care this year</a> 
 
The work of these teams should be credited for the fact that the GST framework is ready three months before the <a href="http://www.businessinsider.in/markets/economy/eyeing-july-1-rollout-arun-jaitley-introduces-four-bills-on-gst-in-parliament/articleshow/57851897.cms">July 1 deadline</a>. 
 
(Image source GST Taxation)

Here’s how difficult the GST process was for the Modi government

<ul><li>India’s Central Board of Direct Taxes (CBDT) wants 12.5 million fresh tax filers under its umbrella by the end of FY19. </li><li>More than bringing new ‘tax payers’ into the system, it’s about bringing new ‘tax filers’ under the purview of the <keyword id="6354751" type="UNKNOWN" weightage="20" keywordseo="income-tax">Income Tax</keyword> Department (ITD) so that individual incomes are disclosed. </li><li>The biggest ask is from the states of Punjab, Haryana, Himachal Pradesh and Jammu &amp; Kashmir who have been asked to get 1.2 million new tax filers into the system before closing.</li></ul>Over <a href="https://timesofindia.indiatimes.com/business/india-business/add-1-25-crore-fresh-tax-filers-this-year-cbdt-to-income-tax-department/articleshow/65117583.cms">7.5 million</a> new tax filers have emerged in India for the current financial year so far, but country’s Income Tax Department (ITD) wants to break the previous year’s record of 10.6 million. In order to so, the Central Board of Direct Taxes (CBDT) has issued directives to widen the tax base further with the target of bringing <a href="https://timesofindia.indiatimes.com/business/india-business/add-1-25-crore-fresh-tax-filers-this-year-cbdt-to-income-tax-department/articleshow/65117583.cms">12.5 million</a> fresh tax filers under its purview. ITD officials <a href="https://www.businesstoday.in/current/economy-politics/around-75-lakh-new-tax-filers-added-to-it-list-this-year-cbdt/story/288294.html">believe</a> that the reason for such great numbers is the policies and enforcement measures undertaken to keep a check on the tax evasion. In its Central Action Plan (CAP), the ITD reiterates that awareness seminars and outreach programmes should be conducted to promote voluntary compliance, especially when it comes to Tier 2 and Tier 3 cities. Are you a new taxpayer or a new tax filer? Just because you file an income tax return, doesn’t necessarily mean that you’re a new taxpayer. A person can file legitimate returns, but still not come into the taxable bracket if your income is below the minimum threshold. So, in order to be a new taxpayer, not only do you have to file your returns but your income also has be taxable. But, in this case, the ITD is only looking for new tax filers, regardless of their salaries. Because once an individual becomes a part of the ITD’s database, it’s <a href="https://timesofindia.indiatimes.com/business/india-business/add-1-25-crore-fresh-tax-filers-this-year-cbdt-to-income-tax-department/articleshow/65117583.cms">unlikely</a> that their income will remain anonymous. The CAP is published by the CBDT annually acting as a vision document describing the future state and prospects for the ITD. Rather than an arbitrary number left to linger on its own, the CBDT has specified targets for states across the country. Punjab, Haryana, Himachal Pradesh and Jammu &amp; Kashmir have the highest target of getting 1.2 million new tax filers. The ITD says this target has been set taking the increase in economic activities into consideration. Pune and Tamil Nadu region are supposed to get 1.1 million and 1 million new tax filers, respectively. The Andhra Pradesh and Telangana regions have to get 1 million new filers while Gujarat, Karnataka and Goa regions follow the tally apart from 12 other I-T regions in the country.

India already has 7.5 million new tax filers, but it’s aiming for 12.5 million by the end of this financial year

As the Prime Minister Narendra Modi-led NDA government is trying to coax opposition for the passage of <keyword id="387846" type="UNKNOWN" weightage="20" keywordseo="GST-Bill">GST bill</keyword> in Rajya Sabha, Congress said it is open to it provided the government accommodated views of the Opposition. 
 
The NDA government is hoping to pass the GST bill in the Winter Session of the parliament. 
 <keyword id="1548801" type="UNKNOWN" weightage="20" keywordseo="Congress-vice-president-Rahul-Gandhi">Congress vice-president Rahul Gandhi</keyword> said the Congress "strongly" believed in the GST bill, saying his party has three issues with the proposed bill: the need to cap GST rate at 18%, an independent dispute-resolution set-up within the GST council and the need to scrap 1% inter-state tax. 
 
"The government has to accept that Congress sits in Parliament, has a view and 20% vote," he said. 
 
"The Congress wants the GST bill to be both pro-industry/trade and pro-consumer. We want a cap on the GST rate so that it's not raised later," said Leader of Opposition in the Rajya Sabha, Ghulam Nabi Azad. He said the government side had assured to discuss the GST bill with the Opposition. 
 
(Image: Indiatimes)

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