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The Income Tax department has come up with several measures to keep an eye on tax defaulters and control their illicit activities. As per reports, these measures involve "blocking" the Permanent Account Numbers (PAN) of such entities, while also getting their LPG subsidies cancelled so that they do not stand eligible for further loans. 
 
These measures will be undertaken this financial year itself, so that the threat of tax avoidance can be tackled with. 
 
The PANs will be blocked in such a way "that these defaulters are not sanctioned any loans or overdraft facility by public sector banks, as the same is bound to become non-performing assets," says the strategy paper prepared by the taxmen. 
 
"Ministry of Finance can be suggested to withdraw facility like LPG subsidy which is directly credited to the bank accounts of the said defaulters," it added. 
 The department has also proposed to reveal the identities of these <keyword id="3434878" type="UNKNOWN" weightage="100" keywordseo="blocked-PANs">blocked PANs</keyword> to the Registrar of Properties, so that the defaulters are not allowed any registration of immovable properties. 
 
<a href="https://s.yimg.com/os/publish-images/finance/2015-09-02/ff446b60-516c-11e5-9ff8-7da1c9e0ffd8_14tax.jpg">Image source</a>

Not paying taxes? I-T department will block your PAN and LPG subsidies

PM Modi has assigned a new task for country’s taxmen, that of doubling the taxpayer base to 10 crore from the present 5.43 crore now; however, he has also said that tax department should warn people that "the long arm of the law" will not leave tax defaulters. 
 
However, he made sure that the tax officers be "soft and sober" while approaching taxpayers, keeping in mind that not everyone is a tax evader. 
 
Modi was addressing the inaugural session of the two-day annual conference of tax administrators, when he said that administration should be founded on five pillars, viz. Revenue, Accountability, Probity, Information and Digitisation (RAPID). 
 
He added that Indians inherently are honest, because of which there should be a "bridge of trust" from the taxmen’s end, to achieve tax collection targets without using force. 
 The conference, titled '<keyword id="3392945" type="UNKNOWN" weightage="100" keywordseo="Rajasva-Gyan-Sangam">Rajasva Gyan Sangam</keyword>' (Knowledge Conference on Revenue), saw Modi asking taxmen to "move towards digitisation" so that tax administration can be made efficient and there should be no trust deficit in the process. 
 
Mentioning the name of the conference, he said that people should make sure that the 'Gyan Sangam' can be turned into "Karma Sangam," making people think about converting ideas into action. 
 
He also began to list the shortcomings in the system, saying that a Google search on 'How to pay taxes in India' comes up with 7 crore answers, while on 'How not to pay taxes in India', it gives out 12 crore results. 
 
"People within the country are not dishonest. People have no problem in paying taxes, but somewhere they have some problem. Understand that problem and try to remove it," Modi told the taxmen present at the conference. 
 
He also went on to stress on the need to remove the fear of harassment from the people’s minds, a common scenario in India which is a major reason behind the trust deficit in the country. 
 
<a href="http://www.flashindianews.com/wp-content/uploads/2015/08/PM-Modi-announces-huge-package-for-Bihar.jpg">Image source</a>

Taxpayers should not fear harassment, Modi asks officials

<ul><li>Public sector banks may not opt for ‘Vivaad se Vishwas’ — a scheme that seeks to resolve ₹9.32 lakh crore worth tax disputes. </li><li>The Income Tax department reportedly approached <keyword id="6354731" type="DOMAIN" weightage="20" keywordseo="state-bank-of-india">State Bank of India</keyword>, <keyword id="6355303" type="DOMAIN" weightage="20" keywordseo="bank-of-india">Bank of India</keyword> and Central Bank of India aside from LIC, Air India, and many other state-owned companies. </li><li>However, the banks said they will decide on a “case to case basis” as the I-T department imposed as the taxes imposed on them aren’t justified. </li></ul>Government-owned companies and public sector banks are not interested in opting for the ‘Vivaad se Vishwas’ scheme, which seeks to resolve ₹9.32 lakh crore ($128.5 billion) worth tax disputes. The scheme waives the interest and penalty levied on taxpayers given the company decides not to precipitate the case and pays the principal amount demanded by the tax department. It aims to resolve as many as 483,000 pending disputes. The Income Tax department reportedly approached State Bank of India, Bank of India and Central Bank of India. However, the banks said they will decide on a “case to case basis” as the taxes imposed by the I-T department aren’t justified. “A lot of these cases are where tax computation is unfair. We don't mind waiting for the outcome of these cases rather settling under this scheme,” <a href="https://economictimes.indiatimes.com/industry/banking/finance/taxman-trying-to-get-psus-on-board-vivaad-se-vishwas/articleshow/74432504.cms">an official told Economic Times. </a> Taxmen have also approached <keyword id="44530" type="COMPANY" weightage="20" keywordseo="PSU">PSU</keyword>’s like Air India, <keyword id="6354412" type="DOMAIN" weightage="20" keywordseo="indian-oil">Indian Oil</keyword>, Mahanagar Gas, LIC Bharat Petroleum, <keyword id="6374014" type="COMPANY" weightage="20" keywordseo="hindustan-petroleum">Hindustan Petroleum</keyword>, General Insurance Corp and Nuclear Power Corporation of India, with the amnesty scheme. LIC, which has more than ₹50,000 crore worth tax dispute, has formed a special committee that will decide whether to avail the scheme or not. LIC officials say they aren’t in a hurry. SBI has disputed tax amounting to ₹30,000 crore, according to Economic Times. 100% target or no appraisals According to CBDT circular, “the target for assessment of performance of the field officers in respect of ‘Vivaad se Vishwaas’ has been fixed at 100% of the cases with disputed tax demand which fulfil the eligibility condition under the scheme.” In other words, if IT officials fail to resolve all the targets they might not be offered any appraisal. According to IT officials, the scheme may find small businessmen as its audience but PSU’s might not opt for it as they have a better chance to win the legal course, reported Economic Times. Under the scheme, taxpayers who pay the undisputed tax before March 31,2020 will not have to pay interest and penalty.The government has set a target of garnering ₹2 lakh crore from the scheme. See also: <a href="https://www.businessinsider.in/stock-market/markets/news/sbi-cards-ipo-date-ipo-size-company-data-and-peer-comparison-with-hdfc-bank-icici-bank-and-axis-bank/articleshow/74297734.cms">SBI Cards IPO is open to investors ⁠— India's second largest credit card seller is hot even before its market debut</a>

Even public sector banks don’t want to opt for ‘Vivaad se Vishwas’ — a tax settlement scheme that aims to resolve disputes

<ul><li>Decriminalisation of offences under the GST law, setting up appellate tribunals and mechanism to curb tax evasion in pan masala, gutkha businesses among the issues to be discussed.</li><li>Besides, GST on online gaming and casinos may come up for deliberations at the Council meeting.</li><li>With regard to taxation of online gaming, casinos and horse racing, the GoM, in its last meeting in November, had agreed on a 28 per cent GST on these segments.</li></ul> Decriminalisation of offences under the GST law, setting up appellate tribunals and mechanism to curb tax evasion in pan masala and gutkha businesses are among the issues slated to be discussed in the <keyword id="3680839" type="General" weightage="20" keywordseo="gst-council-meeting" source="Orion">GST Council meeting</keyword> which began on Saturday morning. Besides, GST on online gaming and casinos may come up for deliberations at the Council meeting. The Group of Ministers (GoM), chaired by Meghalaya Chief Minister Conrad Sangma, set up last year on the issue had submitted its report to Finance Minister Nirmala Sitharaman on Thursday. The Council would also consider a report of tax officers and give clarity on the rate applicability in certain goods and services. "Union Finance Minister Smt. @nsitharaman chairs the 48th meeting of the GST Council via virtual mode, in New Delhi, today," the finance ministry tweeted. With regard to decriminalisation of offences, the law committee of the GST Council, comprising tax officers from the Centre and states, has suggested to the Council to increase the monetary threshold for launching prosecution for GST offences. The law committee has also suggested that the fee payable by taxpayer for compounding of GST offences be lowered to 25 per cent of the tax amount, from up to 150 per cent currently, with a view to improving ease of doing business. It has suggested raising the threshold of launching prosecution to Rs 20 crore, from Rs 5 crore at present. Launching of prosecution by taxmen means commencement of legal proceedings against the offender. The report of the GoM on tax evasion by pan masala and gutkha companies is likely to be taken up for discussion in the Council, sources said. With regard to setting up of Goods and Services Tax Appellate Tribunals (GSTATs), the GoM has suggested that the tribunals should consist of two judicial members, and one technical member each from the Centre and states, besides a retired Supreme Court judge as President, sources said. The GoM on GSTATs was set up in July under the chairmanship of Haryana Deputy Chief Minister Dushyant Chautala. With regard to taxation of online gaming, casinos and horse racing, the GoM, in its last meeting in November, had agreed on a 28 per cent GST on these segments. However, in absence of consensus on whether the tax should be levied on only the fees charged by the portal or the entire consideration, including the bet amount, received from participants, the GoM had decided to refer all suggestions to the GST Council for a final decision. Currently, online gaming attracts 18 per cent GST. The tax is levied on gross gaming revenue, which is the fees charged by online gaming portals. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/india/news/how-indians-have-spent-their-money-on-swiggy-in-2022/slidelist/96285686.cms">Spending ₹75,000 on an order to buying groceries worth ₹16.6 lakh, here’s how Indians used Swiggy in 2022</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/auto/news/upcoming-electric-scooters-in-india-in-2023/articleshow/96278794.cms">From Suzuki and TVS to Hero Electric: Here are some of the top electric scooters expected to launch in 2023</a>

GST Council meet: decriminalisation, tax evasion in pan masala, gutkha biz on agenda

The death of <keyword id="808597" type="COMPANY" weightage="20" keywordseo="VG-Siddhartha">VG Siddhartha</keyword> has shocked one and all. The stock broker-turned-coffee baron’s body was found today, two days after he went missing on Monday (July 29). The share price of Coffee Day Enterprises has lost over ₹1,500 crore (over $200 million) in value in the two days. Not just the corporates, even <a href="https://www.livemint.com/companies/people/sombre-scene-at-sm-krishna-s-house-as-son-in-law-vg-siddhartha-missing-1564466265555.html">politicians of all colours</a> paid their respects to him. <keyword id="3003" type="POSITION" weightage="20" keywordseo="Former-Prime-Minister">Former Prime Minister</keyword> <keyword id="6359332" type="ORGANIZATION" weightage="20" keywordseo="HD-Deve-Gowda">HD Deve Gowda</keyword>, who hails from Karnataka, even broke down on national television. 
	
	
	<div type="twitter" handle="MirrorNow" handlename="Mirror Now" image="http://pbs.twimg.com/profile_images/844708508989841408/HLuil94O_normal.jpg" favoritecount="2" retweetcount="2" status="Mirror Now's @NehaHebbs spoke to JDS chief H. D. Deve Gowda who claimed that #VGSidharth was ill-treated by the tax… https://t.co/NDyoRRSwRZ" createdat="1564495201000" id="1156202791645282304"></div>







 India’s coffee king VG Siddhartha <a href="https://www.businessinsider.in/news/ccd-founder-v-g-siddharthas-dead-body-recovered-by-the-police/articleshow/70459022.cms">(1959 to 2019)</a> is being remembered as the man who brought coffee culture to India before Starbucks. The promoter of Coffee Day Enterprises was a sharp businessman taken out by bad times, allegedly by aggressive taxmen. He was someone who played a silent but significant role in shaping India’s IT revolution, and benefited from it hugely. He was loved by the close-knit and elite Bengaluru corporate circuit of which Siddhartha was an influential member for more reasons than one. 
	
	
	<div type="twitter" handle="CNNnews18" handlename="News18" image="http://pbs.twimg.com/profile_images/923813836724977664/2wlt99tw_normal.jpg" favoritecount="37" retweetcount="12" status="#CCDFounderMissing – The government needs to engage with honest wealth creators and look at how they need to tackle… https://t.co/bWF2rNsNaB" createdat="1564486027000" id="1156164314899738624"></div>







 However, he is barely getting any credit for being just as savvy politically as in business. He had friends across parties and made strong connections. It seemed that way until his mysterious disappearance on July 29 and the discovery of his dead body in the Netravathi river two days later. The grief of all leaders from all parties once again underscored the point. Taxing times Siddhartha <a href="https://www.businessinsider.in/cafe-coffee-day-founder-vg-siddhartha-letter-to-board-of-directors/articleshow/70443951.cms">accused taxmen of harassing him</a> in a letter that he sent to the Board of Directors of his company before he went missing, which led many to blame ‘tax terrorism’ for his plight. 
	
	
	<div type="twitter" handle="TheVijayMallya" handlename="Vijay Mallya" image="http://pbs.twimg.com/profile_images/827708603/Copy_of_VJM_4_normal.JPG" favoritecount="4652" retweetcount="845" status="I am indirectly related to VG Siddhartha. Excellent human and brilliant entrepreneur. I am devastated with the cont… https://t.co/OLFGOFBdsG" createdat="1564523998000" id="1156323576171114496"></div>







 The Income Tax Department countered saying that the <a href="https://economictimes.indiatimes.com/news/politics-and-nation/tax-department-acted-as-per-law-in-ccd-promoter-siddhartha-case-sources/articleshow/70449827.cms">millionaire businessman admitted to</a> having ₹480 crore of unaccounted wealth. However, he did not reveal the source or pay the tax due on that money until his death, according to the department. Siddhartha’s harassment charge at the tax department came at a time while his father-in-law SM Krishna is with Bharatiya Janata Party (BJP), that’s ruling at the centre and state. He <a href="https://www.ndtv.com/india-news/why-sm-krishna-is-an-important-acquisition-for-bjp-1672353">switched his allegiance to the BJP in 2017</a> after being in the rival Congress camp for 46 years. However, Krishna was conspicuous in his silence during the chaotic political power play in Karnataka over the last few weeks. The bitter battle for power was <a href="https://m.economictimes.com/news/politics-and-nation/karnataka-assembly-floor-test-live-news-updates-yediyurappa-bjp-speaker/liveblog/70428190.cms">eventually won by his party</a> BJP, and BS Yediyurappa was <a href="https://www.livemint.com/politics/news/yediyurappa-sworn-in-as-karnataka-chief-minister-for-record-fourth-time-1564147393568.html">sworn in as the Chief Minister on July 26</a>, three days before Siddhartha’s disappearance and death. One of the many who were holding off Yediyurappa from claiming power was Congress leader DK Shivakumar, a political mastermind from Karnataka who put up a fervent fight against the BJP. He is also a close friend of Siddhartha. Therefore, Shivkumar’s outburst soon after Siddhartha went missing was not surprising. 
	
	
	<div type="twitter" handle="DKShivakumar" handlename="DK Shivakumar" image="http://pbs.twimg.com/profile_images/807171771233247232/iDF5c7Pi_normal.jpg" favoritecount="2409" retweetcount="656" status="The letter purportedly written by Shri VG Siddhartha which is circulating is dated July 27th. I received a call fr… https://t.co/Qo6ZQVF4fI" createdat="1564466916000" id="1156084157325254656"></div>







 Shivakumar too, has a tax case against him and his premises were raided in 2017 by officials who <a href="https://www.ndtv.com/karnataka-news/300-crores-undisclosed-income-found-in-raid-on-dk-shivakumar-sources-1733978">unearthed unaccounted cash of ₹300 crore</a> and, shockingly, <a href="https://caravanmagazine.in/politics/yeddyurappa-diaries-bjp-1800-crore-payouts-jaitley-rajnath-gadkari-advani-crores">copies of a diary allegedly maintained by his rival Yediyurappa</a>. From Shivakumar to Yediyurappa to Kumaraswamy, people across the political spectrum are grieving Siddhartha’s untimely death. It is also a testament to the fact that in India, businessmen cannot thrive without politically astute connections. The Rajkumar Ransom Both the success of his ventures and his father-in-law’s power made Siddhartha important in Karnataka. When S M Krishna’s government was frantically coming up with a massive ransom necessary to free <a href="https://www.thehindu.com/news/national/karnataka/rajkumar-case-verdict-the-perfect-script-that-will-remain-a-secret/article25042510.ece">Rajkumar, the Kannada superstar who was kidnapped by Veerappan in 2000</a>, Siddhartha came to help. According to an account, <a href="https://www.telegraphindia.com/india/telgi-link-to-veerappan-ransom/cid/729965https://www.telegraphindia.com/india/telgi-link-to-veerappan-ransom/cid/729965">Siddhartha was one of the five people in the room</a> that included the then CM Krishna, Mallikarjun Kharge, and Abdul Karim Telgi. Telgi is better known for his $2.9 billion fake stamp paper scam, and was acquitted from it, <a href="https://www.news18.com/news/india/abdul-karim-telgi-acquitted-in-stamp-paper-scam-year-after-his-death-1987855.html">after his death, for lack of evidence</a>. The government of Karnataka at the time <a href="https://timesofindia.indiatimes.com/city/bengaluru/Govt-not-Rajkumar-family-paid-ransom-Ex-DGP/articleshow/29005840.cms">insisted that it had paid for Rajkumar’s release</a> from <a href="https://timesofindia.indiatimes.com/india/Veerappan-End-of-three-decades-of-terror/articleshow/890585.cms?referral=PM">Veerappan, a dreaded bandit</a> who modelled himself after Robin Hood. However, it has been alleged many times that <a href="https://timesofindia.indiatimes.com/india/Veerappan-End-of-three-decades-of-terror/articleshow/890585.cms?referral=PM">both government and private money were paid</a> to secure the release of the actor, while thousands of Rajkumar’s fans took to the streets to protest, violently at times. The role and involvement of Siddhartha may remain unclear. The length of the arm between Chief Minister Krishna and his son-in-law in state matters may remain anybody’s guess. While the details of Siddhartha's political prowess may remain unknown, his achievements in business have been celebrated abundantly. Coffee estate to real estate India has always had coffee houses, in the big cities at least, where for decades thinkers, lovers, and revolutionaries have hung out. Siddhartha’s chain Cafe Coffee Day (CCD) brought the 21st century colours to this culture. 
	
 
 
 <div type="image" title="An employee prepares coffee for customers at a Cafe Coffee Day outlet in Mumbai" msid="70464424" hostid="261" caption="&amp;lt;p&amp;gt;An employee prepares coffee for customers at a Cafe Coffee Day outlet in Mumbai, November 2, 2015. REUTERS/Danish Siddiqui/Files&amp;lt;/p&amp;gt;"></div>







 It may have helped that his father-in-law SM Krishna -- Chief Minister of Karnataka between 1999 to 2004 -- was a man with massive political clout at the time. However, Siddhartha’s privilege does not take away the credit due for his business acumen. There are many who own estates in <a href="https://www.indiacoffee.org/coffee-regions-india.html">Karnataka’s coffee belt</a> but it was Siddhartha who made the right moves at the right time and CCD became the go-to place for young Indians at the turn of the century long before competitors woke up to the opportunity. Privileged and benevolent Siddhartha not only built his own empire of coffee chains, real estate, financial services and logistics, he also supported entrepreneurs who went on to become icons in their own right. Infosys is a shining example, which went on to be the first poster boy of India’s IT revolution. However, the company didn’t have enough takers for its shares at the time of its IPO. Siddhartha, who was a stock broker in Bengaluru at the time, had underwritten those shares and bought them. He made a lot of money out of it but only because he knew their worth when no one else did. Infosys and Mindtree are <a href="https://economictimes.indiatimes.com/tech/ites/tech-savvy-siddhartha-got-many-a-tech-winner-going/articleshow/70458429.cms?from=mdrhttps://economictimes.indiatimes.com/tech/ites/tech-savvy-siddhartha-got-many-a-tech-winner-going/articleshow/70458429.cms?from=mdr">only two of the many examples</a> were Siddhartha backed entrepreneurs. He owed a lot of his wisdom and foresight to the training he received under Mahendra Kampani (1959 to 2017), one of the stars of India’s stock market, who was the sitting member of the governing board at the Bombay Stock Exchange (BSE) <a href="https://www.business-standard.com/article/specials/mahendra-kampani-dies-in-car-crash-197082701105_1.html">until his death in a car crash in 2017</a>. After his Masters in Economics, Siddhartha got his early training at JM Financial under Kampani in 1983-84. Those two years of training and some capital from his father made him an independent broker in Bengaluru later. It was then that he underwrote the shares of Infosys and profited from the investment. The other ventures and profits followed this initial success. However, one may wonder if he could have built his fortune as a businessman in India without being just as savvy politically. SEE ALSO: <a href="https://www.businessinsider.in/business/cafe-coffee-day-founder-vg-siddhartha-letter-to-board-of-directors/articleshow/70443951.cms" data-type="tilCustomLink" target="_blank">Full text of the letter written by Cafe Coffee Day founder VG Siddhartha before he went missing</a>

A former Prime Minister cried on national TV for VG Siddhartha-- the untold tales of politics and privilege may die with India’s coffee baron

<ul><li>Foreign investors had pulled out billions from India's equity market ever since the tax surcharge was announced in the latest budget.</li><li>The Narendra Modi government also announced a slew of measures including tax reforms to revive a sluggish economy.</li><li><keyword id="7706673" type="UNKNOWN" weightage="20" keywordseo="finance-minister-nirmala-sitharaman">Finance Minister Nirmala Sitharaman</keyword> and her team addressed a press conference to restore the faith in the economy and the government.</li><li>Reform is a continuous process, she said in her opening remarks.</li></ul>In a bid to restore the faith in the Indian economy and the Narendra Modi government, Finance Minister Nirmala Sitharaman assured the investors that the government respects wealth creators and declared that the surcharge on foreign and domestic equity investors has been rolled back. The latest budget for the financial year ending March 2020 imposed an additional tax on the country's super rich and foreign portfolio investors (FPIs) got caught in the crossfire. The subsequent anger and market sell-off has wiped off billions of rupees in share market wealth since then as foreign investors rushed for the exit. Most foreign portfolio investors in India operate as non-corporate entities such as trusts and associations, which are taxed like individuals and therefore the additional tax would fall on them. The government will lose ₹1,400 crore by rolling back the additional surcharge imposed in the latest budget. Not just the surcharge on capital gains, there are other tax reforms too All pending tax notices in India will be cleared by October 1, Finance Minister Nirmala Sitharaman declared. If any case must continue, the notice will have to renewed once again after October 1 for it to be applicable. All refunds of the goods and services tax (GST) pending so far will be cleared within the next 30 days. All future refunds will have to paid within 60 days. "Reform is a continuous process," she said in her opening remarks adding that tax scrutiny will be 'faceless' from Vijaya Dashami day, the last day of the Indian festival of Dussehra. The idea is to ensure there is no physical interface between the taxman and the assessee to avoid any harassment of the taxpayer. "We are inclined to move from the prosecution route to more humane approach. I want companies and the media to see that at no point, the intention of the government is to take the prosecution route," Sitharaman said. "Issue of IT orders -- notices, summons, etc-- will go through a centralised computer system from October 1," she said. This would mean that any tax demand will be approved by a central authority. "Any notice issued with a computer generated unique document identification (DIN) number will not be valid," she said. India moves to make home loans cheaper and easier The National Housing Board will given additional ₹20,000 crore to be further lent to housing finance company. The government will release the ₹70,000 crore to state-owned banks, which will allow for more credit and lower lending rates. The banks have also been asked to pass on every fall in the cost of funds to the consumers. The government wants people to get cheaper loans for homes and cars as demand took a nosedive in recent months. Government wants to make more money to be available for credit The government will take steps to create a credit default swap market in India in consultation with the Reserve Bank of India and the Securities and Exchange Board of India. A credit default swap (CDS) is a way for a lender to hedge against a loan turning bad. "For example, if a lender is worried that a borrower is going to <a href="https://www.investopedia.com/terms/d/default2.asp" data-type="internalLink">default</a> on a loan, the lender could use a CDS to offset or swap that risk. To swap the risk of default, the lender buys a CDS from another investor who agrees to reimburse the lender in the case the borrower defaults. Most CDS will require an ongoing <a href="https://www.investopedia.com/terms/p/premium.asp" data-type="internalLink">premium</a> payment to maintain the contract, which is like an insurance policy," according to Investopedia. The government sets up a dedicated panel to make infrastructure development faster An inter-ministerial task force will be set up to expedite the proposed government investments in infrastructure. The government had announced earlier that it would invest ₹100 lakh crore in infrastructure projects in the next five years. Automobile sector "BS-IV vehicles purchased until March 30, 2020 will be allowed to run on the roads for the duration of the registration," the Finance Minister said. Any vehicle will bought from now until March 2020 will be eligible for 30% depreciation, double that of the current rate of 15%. "That will largely benefit commercial vehicle segment. In the case of cars, only companies buying cars will benefit and that doesn't affect us," RC Bhargava, Chairman, Maruti Suzuki, the country's largest car maker told CNBC-TV18. Government departments have been told to actively replace the old vehicles. Until now, there was a ban on the government offices from retiring their old vehicles as part of a cost control initiative. The stimulus hopes to boost India's sluggish economy Indian economy has slowed down sharply leading to millions of job As many as <a href="https://www.businessinsider.in/news/a-startup-that-bets-on-packaged-keto-snacks-and-chocolates-raises-seed-funding/articleshow/70784578.cms" data-type="tilCustomLink" target="_blank">30 million jobs in the textile sector</a> and 350,000 people in the automobile sector have lost their jobs. However, the Finance Minister started her address citing the slowdown in economies around the world and highlighting that India is faring much better than many others. The minister blamed the impact of <keyword id="3987248" type="PERSON" weightage="20" keywordseo="us-china-trade-war">US-China trade war</keyword> for the current sluggishness in the economy. The slowdown in India has raised questions about the government's ability to meet its fiscal targets. However, the Finance Minister denied any pressure. "I have met tax authorities in three different places and I do not get the feeling that the tax collection targets are unrealistic," she said adding that the taxmen have been specifically told not to overreach and harass the taxpayer in a bid to meet their targets . SEE ALSO: <a href="https://www.businessinsider.in/job-cuts-at-parle-and-britannia-sales-show-indian-economy-is-in-dire-straits/articleshow/70766429.cms" data-type="tilCustomLink" target="_blank">India’s biscuit crisis shows slowdown is hurting the poor more — and job losses are making it worse</a> <a href="https://www.businessinsider.in/epfo-wont-lend-money-to-private-companies/articleshow/70785890.cms" data-type="tilCustomLink" target="_blank">Indian pension fund says it won’t lend money to private companies</a>

India unveils economic stimulus-- from homes to cars to banks to infrastructure to equity markets

(Eds: Adding more quotes) New Delhi, Feb 10 () Former Finance Minister P Chidambaram on Monday tore into Narendra Modi government's handling of the economy, saying it was "perilously close to a collapse" and was being attended to by "incompetent doctors". The economy, he said, was facing twin problems of rising unemployment and falling consumption but the government continues to live in denial. Initiating the debate on the Union Budget for 2020-21 in the Rajya Sabha, Chidambaram said more money needs to be put in hands of people and not give "extraordinary powers" to junior taxmen to unleash "tax terrorism." He offered Finance Minister Nirmala Sitharaman the same advice that Modi as BJP's prime ministerial candidate had offered him in November 2013. On "November 2, 2013, a very distinguished political leader said and I quote: "Economy is in trouble. The youth wants jobs. Devote more time to the economy, not on petty politics. Please focus on the job at hand. Very wise advice. I can't do anything better than reading this piece of advice to the Finance Minister", he noted. According to him, the economy was facing structural problems but the government continues to believe they were cyclical in nature. Modi government's chief economic adviser for four years, Arvind Subramanian, has stated that the economy is in the ICU (Intensive Care Unit). But "I would say the patient has been kept out of the ICU and incompetent doctors are looking at the patient," Chidambaram said. "It is dangerous to have a patient out of the ICU and being looked upon by incompetent doctors. What is the point standing around and chanting slogan 'Sab ka Saath, Sab ka Vishwas'," he said. According to Chidambaram, the BJP government lives in denial, refuses to acknowledge its mistakes and has an "outdated" predisposition towards protectionism and a strong rupee, and is against bilateral as well as multilateral trade agreements. "We have an economy which is perilously close to collapse. It has to be attended to by very competent doctors. In the last few years, we have found the doctors are not so competent," he said. "We are living in denial and we are ignoring two big elephants in the room -- one is rising unemployment and the other is fall in consumption. Unemployment rises, consumption falls, the Indian economy becomes poorer and not richer," he noted. Chidambaram called demonetisation of old 500 and 1,000 rupee notes as well as the hurried implementation of a "flawed" Goods and Services Tax (GST) with wrong design, rates, structure and procedure and an unprepared system as "monumental blunders" that ruined the economy. "Because of its refusal to admit mistakes, because it lives in denial, because of its predisposition, the government either does not know or if it knows is not willing to make it clear that this is the state of the economy," he said. With an unprecedented six consecutive quarters of falling growth, the economy is facing demand constraints and is investment-starved, he said. "When we point out the mistake of the government, the government must have an open mind to debate and if it is a mistake, admit it." "It is living in denial. It simply does not accept that the state of the economy is extremely bad," Chidambaram said as he reeled out the government's own statistics to drive home the point. While GDP has fallen to an 11-year low of 4.5 per cent in 2019 July-September quarter, agriculture is growing by just 2 per cent, while consumer price inflation has risen from 1.9 per cent in January 2019 to 7.4 per cent in a matter of 11 months. Also, food inflation is at 12.2 per cent. Bank credit is growing 8 per cent with non-food credit rising by 7-8 per cent and credit to the industry by just 2.7 per cent. Credit to agriculture has declined from 18.3 per cent to 5.3 per cent and that for MSMEs from 6.7 per cent to 1.6 per cent, he said. "Who are your doctors?, I want to know," he said, adding the government considers Congress as an untouchable and does not think of any good about the rest of the Opposition and so doesn't consult them. Chidambaram charged that instead of putting money in the hands of people, the Modi government "puts money in hands of 200 corporates" by way of cut in corporate tax. Stating that every competent doctor that the Modi government could ever find has left the country, he listed out former RBI governors Raghuram Rajan and Urjit Patel, former CEA Arvind Subramanian and former NITI Aayog Vice Chairman Arvind Panagariya as persons who quit during the BJP rule. "Fear and uncertainty prevail in the country," he added. Chidambaram also attacked Sitharaman for reading out a 160-minute speech without talking about the state of the economy and its management. "Question on my mind is what was the Finance Minister trying to say? If you take 160 minutes to read the speech and still few pages are left to read, what is the narrative, what is the story you are trying to say. "You are living in echo chambers. You want to hear your own voice," he said. Chidambaram said overall industrial index showed just 0.6 per cent growth with every major industry being at either near-zero or in the negative zone. Thermal power plants are operating at just 55 per cent of the capacity as factories have either closed or are on the verge of closure, he added. "That gives you a good picture of the state of the economy. You don't require a MRI," he said. "You are in management for six years. How long can you blame previous managers," he added. Further, Chidambaram said the government was burying unfavourable reports such as the labour survey that put unemployment at 45-year high of 6.1 per cent at the end of 2017-18. As also the one that talked of consumer expenditure falling to 3.7 per cent between 2011-12 and 2017-18, he noted. ANZ RAM MKJ

Economy perilously close to collapse, being attended by incompetent doctors: Chidambaram

The Indian Government passed the <a href="http://www.businessinsider.in/searchresult.cms?query=income+tax+department&amp;sortorder=effectivedate">I-T amendment bill</a>, making the laws stricter but it is yet to see how strongly the laws will be enforced. 
 
According to <a href="http://www.businessinsider.in/searchresult.cms?query=demonetisation&amp;sortorder=effectivedate">new laws</a>, many unexplained expenditure, credits and deposits such as wealth inheritance from grandparents, wedding expenditure, etc will have to be explained. In case the person fails to give a ‘satisfactory’ reply to the taxmen on the source of funds received or give, he/she will have to cough up as much as 83% tax. 
 
"We have discussed the matter among ourselves. It's a strong provision in the (Income Tax) Act and the department would find it handy in mobilising tax from black money. But there are chances that it may be misused," a senior tax official in Mumbai which accounts for the highest direct tax collection told ET. 
 
READ ALSO: <a href="http://www.businessinsider.in/people-with-unaccounted-cashheres-how-the-i-t-department-is-watching-you/articleshow/56717177.cms">People with unaccounted cash: Here's how the I-T department is watching you </a> 
 
The relevant parts of the I-T Act are: Section 68 (dealing with unexplained cash credit, which is applicable to loans, gifts and share capital); section 69A (unexplained money, jewellery or valuable items); 69B (unexplained investment); and section 69C (unexplained expenditure.) Once section 115BBE is invoked, then the income (which is under question) cannot be set off against any other loss for the year or carried forward. 
 
The laws have gotten more teeth but can be misused too as the person only has to tell a right source of funds. Very few people maintain account books. 
 
“If one is able to establish unexplained deposits, loans, or investments, can the Assessing officer still not be satisfied? While every effort will be made by AO to determine identified credits as unexplained, assesses will try to prove otherwise by adequate evidences, by establishing the identity, capacity and genuineness,” Mitil Chokshi Senior Partners Chokshi and Chokshi told ET.

Tax laws have more teeth now but they can be misused too. Here’s how

<keyword id="58225" type="ORGANIZATION" weightage="100" keywordseo="NRIs">NRIs</keyword> with offshore bank accounts would not be able to escape the investigation by tax authorities. If found guilty, they will have to instruct the overseas banks to share their account information with the Indian tax office to prove themselves innocent. 
 
Only after the authorities are convinced that the money in the account does not belong to the person who has been pulled up for hiding offshore assets, would they be able to escape their eyes. 
 In a recent case, the Bombay High Court has dismissed the writ petition filed by an NRI, who was an alleged beneficiary of a trust which was linked to an <keyword id="832748" type="ORGANIZATION" weightage="100" keywordseo="HSBC-Geneva">HSBC Geneva</keyword> account, after she refused to sign the "consent waiver" form. Due to secrecy rules, Switzerland banks and tax havens don’t divulge account information until they get consent from account holders. 
 
The court, in its order dated April 5, said, "In the normal course of human conduct if a person has nothing to hide and serious allegations/questions are being raised about the funds, a person would make available the documents which would put to rest all questions which seem to arise in the mind of the authorities." 
 
Since the petition was not withdrawn, the order would most likely be used by the taxmen against those they suspect to have HSBC Geneva accounts. 
 
<a href="http://s3.amazonaws.com/armstrongeconomics-wp/2014/06/Swiss-COW.jpg">Image source</a>

Tax authorities can investigate NRIs with offshore bank accounts until they give consent for information sharing

Indian tax officials are secretly planning a silent revolt against the <keyword id="208415" type="ORGANIZATION" weightage="100" keywordseo="department-of-revenue">department of revenue</keyword> (DoR) headed by <keyword id="6377137" type="PERSON" weightage="100" keywordseo="Hasmukh-Adhia">Hasmukh Adhia</keyword>. Reportedly, the officials are not happy with the directives and functioning of Adhia, a Gujarat-cadre IAS officer and one of the most powerful bureaucrats in India. 
 It was only last week that the taxmen, including some of the senior-most officers, met in Mumbai, where they discussed DoR's alleged interference in "operational matters". They believe that this interference has "hurt the morale" of several <keyword id="141310" type="UNKNOWN" weightage="100" keywordseo="I-T-officials">I-T officials</keyword>. 
 
Also read: <a href="http://www.businessinsider.in/SRK-gets-notice-from-Income-tax-department/articleshow/53378793.cms">Income Tax department wants Shah Rukh Khan to disclose offshore investments</a> 
 
The ‘emergency meeting’ was held to discuss DoR’s efforts to undermine the autonomy of the Central Board of Direct Taxes, two officials who attended the meeting told <a href="http://economictimes.indiatimes.com/news/politics-and-nation/i-t-officers-up-in-arms-against-revenue-department-to-approach-fm-arun-jaitley-and-pmo/articleshow/53423536.cms">ET</a>. 
 
The meeting was called after an I-T officer was transferred after sending an advance tax notice on a large bank, and it was in this meeting that the officers decided to draw the attention of the finance ministry and Prime Minister's Office to DoR and its ways. 
 
"The DoR," said a senior officer from the <a href="http://www.businessinsider.in/The-Income-Tax-Department-wants-to-talk-to-your-kids/articleshow/53119207.cms">I-T department</a>, "should work as per the Government of India's Allocation of Business Rules, 1961." 
 
"But it is indulging in micro-management - in daily operations like tax assessment, transfers and postings. We have differences with revenue secretary Mr Adhia's views aired during the video conferences he holds on Saturdays," the officer added. 
 
Also read: ​<a href="http://www.businessinsider.in/Tip-of-the-iceberg-I-T-department-unearths-over-Rs-13000-crore-black-money-just-from-two-sets-of-info/articleshow/52936249.cms">Tip of the iceberg? I-T department unearths over Rs 13,000 crore black money just from two sets of info</a> 
 
<a href="http://images.financialexpress.com/2016/04/Hasmukh-Adhia-EP.jpg">Image source</a>

Income tax officials are secretly planning a revolt against the revenue department

Right from <keyword id="2583871" type="UNKNOWN" weightage="20" keywordseo="Swachch-Bharat-Abhiyaan">Swachch Bharat Abhiyaan</keyword> to <keyword id="2472340" type="UNKNOWN" weightage="20" keywordseo="Digital-India-initiative">Digital India initiative</keyword> and Make in India campaign, Indians hailed the reform that the <keyword id="6360789" type="ORGANIZATION" weightage="20" keywordseo="Modi-Government">Modi government</keyword> has initiated ever since it came to power. But it seems that business lobby of the country is losing its confidence in the Modi government, which is poised to complete one year later next month. This was revealed in a Times of India report. 
 
According to the news daily, two tweets from Harsh Mariwala, the chairman of Rs 4,600-crore Marico, narrated this story on Tuesday. In the first tweet, Mariwala said that "Sheen is falling of Modi govt in the context of promises, and gradual delivery. Need to move fast, hope interest rates are reduced today." Then, through another tweet he asserted, "Heard from a leading politician that if elections were held today NDA will barely win 200 seats in spite of weak opposition." 
 
It is not just Mariwala who is unhappy with the Modi government, but many other CEOs also come under the group of cheerless leaders. It's said that the conversation in board rooms is changing. According to a TOI report, “Captains of industry are now highlighting two new concerns, albeit in hushed tones - some of the recent notices from the taxmen and the seemingly unchecked Hindutva agenda of certain right wing groups.” 
 
Some of the business leaders are also minutely observing the attacks on churches as well as the fresh spurt of tax notices. They believe this is sending out a wrong signal to investors at a time when the government is striving hard to woo foreign investors, the financial daily stated. Harsh Goenka, RPG Group chairman, told TOI said that tax demands of such high value would invariably result in increased litigations. "As long as the issues are treated objectively and fairly, it should not worry <keyword id="46431" type="CITY" weightage="20" keywordseo="India-Inc">India Inc</keyword>. However, as a secular nation, we must avoid any form of fundamentalist activity. Random fascist comments lead to communal disharmony and should be dealt with severely," he said. 
 
A majority of CEOs also agreed that much has happened in the last few months and the Modi government is suffering from the burden of over expectations.

India Inc unhappy with Modi Govt’s ‘sluggish reforms’

<keyword id="2829070" type="UNKNOWN" weightage="20" keywordseo="While-PM">While PM</keyword> Modi is inviting global companies to come and invest in India, the epic legal battle brewing between foreign portfolio investors (FPI) and Indian tax authorities is sending wrong signals outside the country—and is thus, putting India’s reputation as a foreign-investment-friendly nation at stake. 
 As per a news report by The Economic Times, five FPIs have teamed up to challenge the applicability of minimum alternate tax (MAT) to capital gains arising from trading in stocks and bonds. The FPIs plan to file a writ petition in the <keyword id="48485" type="ORGANIZATION" weightage="20" keywordseo="Bombay-high-court">Bombay High Court</keyword> on Thursday challenging the tax demand. 
 
ET could not ascertain the names of the five FPIs and the quantum of MAT demand. However, demands ranging from Rs 1 crore to Rs 50 crore have been raised by taxmen in draft assessment orders to FPIs at the end of last month. 
 <keyword id="231315" type="POSITION" weightage="20" keywordseo="Junior-finance-minister">Junior Finance Minister</keyword> <keyword id="6357677" type="PERSON" weightage="20" keywordseo="Jayant-Sinha">Jayant Sinha</keyword> has confirmed on written that 68 notices had been sent to FPIs for payment of Rs 602.83 crore towards MAT. 
 Earlier, in a statement that had caused considerable consternation, the <keyword id="6355261" type="POSITION" weightage="20" keywordseo="Finance-minister">finance minister</keyword> had said the government could potentially collect around Rs 40,000 crore from FPIs. 
 
The news report by the financial daily reads, the dispute, which has damaged India's international reputation, flared up when the I-T department started sending notices to FPIs about six months ago asking them to pay MAT for the financial year 2011-12. Many tax experts, ET spoke to said MAT cannot be applied to an entity that doesn't have a so-called permanent establishment in the country. 
 
By March 31, assessing officers had sent draft assessment orders to FPIs asking them to pay MAT. Subsequently, demands were raised for two more years — FY10 and FY11 — in the first week of April. Indian income-tax laws allow assessing officers to go back seven years in the hunt for previous taxes. 
 During a conference call last Wednesday, <keyword id="120753" type="POSITION" weightage="20" keywordseo="revenue-secretary">Revenue Secretary</keyword> <keyword id="6359111" type="PERSON" weightage="20" keywordseo="Shaktikanta-Das">Shaktikanta Das</keyword>, Central Board of Direct Taxes (CBDT) Chairperson Anita Kapur and <keyword id="141786" type="POSITION" weightage="20" keywordseo="Minister-of-State-for-Finance">Minister of State for Finance</keyword> Jayant Sinha told investors that MAT would not be levied on funds that have invested through countries such as <keyword id="6356662" type="COUNTRY" weightage="20" keywordseo="Singapore">Singapore</keyword> and Mauritius, with whom India has double-taxation avoidance agreements (DTAAs). 
 
A day later, CBDT issued a circular instructing tax officers that decisions should be taken in "...all cases of foreign institutional investors seeking treaty benefits under the provisions of respective DTAAs, decisions may be taken on such claims within one month from the date such claim is filed". Many tax experts have dubbed this order vague since it doesn't mention the word MAT or tell tax officers what action should be taken in this regard. 
 
(Image: Reuters)

India’s reputation as foreign investment friendly nation at stake. Know why

As India’s new Finance Minister, <keyword id="42575" type="PERSON" weightage="60" keywordseo="Arun-Jaitley">Arun Jaitley</keyword>, took the oath of office administered by President Pranab Mukherjee, one wonders if the thought crossed his mind that one of the major problems he would be facing soon is the taxmen’s battles with foreign firms – a legacy handed down by the current President when he held the finance job. 
 <keyword id="15492" type="CITY" weightage="100" keywordseo="Vodafone">Vodafone</keyword>, IBM, Nokia and Shell are just some of the foreign majors embroiled in disputes with the Indian tax authorities. The sums involved are mindboggling –Vodafone is supposed to owe in the region of Rs 20,000 crore; Nokia has been hit with a Rs 2,400 crore tax claim; IBM has Rs 6,857 crore outstanding tax notice against it and Shell has been told it needs to pay an additional Rs 5,000 crore in taxes. 
 
Corporate chieftains around the globe, who might have been thinking about investing in the country, were made to rethink. There have been other consequences and Singapore finally overtook Mauritius as the preferred destination for foreign investors to route their money through, because the former provides better legal protection in cases involving foreign tax liabilities. 
 
For many observers, the genesis of these tax wars is the Vodafone dispute. When the Supreme Court decided in favour of the telecom major on whether it owed taxes to the Indian exchequer over its acquisition of the Indian operations of Hong Kong-based Hutchison Whampoa, the then Finance Minister Pranab Mukherjee went to the unprecedented extent of revising the tax laws to introduce a retrospective liability. 
This, at a time, when India’s most important selling pitch against its ‘bigger and better’ rival China was that the rule of law and the independence of the judiciary system prevailed in the country unlike the wheeling and dealing that happened behind the bamboo curtain in China. 
 Fast forward a few years and you found India’s economy in the doldrums – recording sub-5% <keyword id="35050" type="CITY" weightage="80" keywordseo="gdp">GDP</keyword> growth. The long-term consequences of India’s tax adventurism are certainly being felt even now. The new BJP government has two courses it can pursue. One is to introduce more clarity and transparency in laws governing areas like transfer pricing and M&amp;A, which typically bedevil foreign investments. The other is to speed up the arbitration proceedings in cases like Vodafone, which got completely tangled up in the previous government’s larger dysfunction. 
 
Unfortunately, once the precedent has been set and it has been proved that the Indian government can go to the extent of changing laws retrospectively to get its way, it could be extremely difficult to convince investors that similar instances will not take place in the future. And the same applies for the industries, especially when laws like the Land Acquisition Act was pushed through by the UPA government. It is obvious that the Pandora’s Box can easily open if governments have an agenda to pursue. 
 
Meanwhile, Prime Minister Narendra Modi inherits a fragile fiscal situation and he will have to consult with Jaitley (the latter has to present the new Budget) whether making major tax concessions is possible in the present state of government finances. 
 As the BJP must have found out during its poll campaign, it is easier to make ambitious promises in the heat of the battle, like its proposal to abolish <keyword id="6354751" type="COMPANY" weightage="100" keywordseo="Income-Tax">income tax</keyword>, than implement them when the time arrives. 
 
Maverick leaders of the BJP, such as Subramanian Swamy, who went to town against the UPA’s tax terrorism, do not find a place in the new government. Instead, Jaitley’s background as a high profile lawyer might provide just the skills he needs as he tries to untangle the legal wrangles that the policies of the previous regime has left for him to deal with. 
Image: Thinkstock

You Searched For "indian taxmen" and got 13 results

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