Tax. (IANS Infographics)
A fund-starved government will be better off looking at increased collections fuelled by an economic recovery and improved technology driven enforcement rather than through the introduction of new taxes, a KPMG survey showed on Wednesday.
According to the pre-budget survey 2021-22, only 2 per cent of the respondents feel that raising taxes would be the solution to mobilise additional revenue for the government that sees an increase in its expenditure due to the pandemic.
A majority (20 per cent) held that the Government’s revenue needs can be met through increased collections fuelled by an economic recovery as well as improved technology driven enforcement (49 per cent).
The KPMG survey conducted in January 2021 has tried to capture the expectations of all important stakeholders on various tax aspects of the budget. In all, 250 respondents across sectors participated in the survey.
Despite the expectation that government may not raise taxes, the survey has brought out that a smaller number of respondents (29 per cent) expect that a new Covid-19 cess may be imposed in the Budget.
When it came to some of the measures the government could adopt to provide relief to the salaried class, some respondents (74 per cent) felt that an enhancement in the standard deduction on salary income from the existing Rs 50,000 should be considered.
As to what the government could do more to help resolve disputes, a whopping (77 per cent) of respondents felt that a mediation scheme should be introduced in the Budget to enable negotiated settlements of tax disputes.
AS many as 38 per cent respondents felt that the Advanced Pricing Agreement (APA) programme had been effective in pre-empting/resolving key transfer pricing controversies. About 40 per cent respondents felt that the introduction of the General Anti-Avoidance Rules (GAAR) and the implementation of the Multilateral Instrument (MLI) could lead to increase in tax disputes.
Given the financial impact of the pandemic, a majority of respondents (47 per cent) expect an increase in the deduction with respect to provisions made towards Non-Performing Assets (NPA) by banks and NBFCs. This would provide much needed relief to the banks and NBFCs, who are bracing for increased delinquencies, on account of the pandemic.
A toral of 43 per cent respondents felt that a specific carve out for unlisted shares and securities from tax collected at source (TCS) was also warranted.
Asked if respondents felt that the Goods and Services Tax (GST) regime was getting simplified over the last three years, the response was divided. While 45.97 per cent believed that it was simplified, 41.71 believed otherwise. This could be due to multiple reasons such as various notifications, circulars being issued on a regular basis, number of increased compliances for multiple registrations, stringent provisions for credits availment which, in turn, leads to additional costs and time investments in the business.
Nearly two-thirds respondents (62 per cent) were comfortable with the digital compliance system introduced for GST. A large percentage of respondents (64 per cent) believe that CBIC should introduce customs assisted assessment for Micro, Small and Medium Enterprises (MSMEs)
Lastly, in line with the need to provide a level playing field to provide a level playing fields for Indian companies to access overseas capital markets and facilitate a better valuation for equity shares, 70 per cent respondents said that the government should announce provisions to facilitate a regime for direct overseas listing of Indian companies.
Commenting on the findings of the survey, Sunil Badala, Partner and Head, Financial Services- Tax, KPMG in India, said: “Our Pre-Budget Survey indicates that relief for the salaried class by way of an enhancement in the standard deduction on salary income from existing limit of Rs 50,000 is highly awaited. Corporates are also hopeful that dispute resolution will continue to be a priority for the Government; and that negotiated settlements of tax disputes will be enabled. Overall, we notice that the respondents do not expect introduction of any new taxes including Covid-19 cess.”
IT Minister blasts Twitter, says it failed to comply with new guidelines
A day after micro-blogging platform Twitter said that it has appointed a Chief Compliance Officer, Union Electronics and IT Minister Ravi Shankar Prasad on Wednesday said that the US-based company has failed to comply to the new intermediary guidelines.
In a series of tweets, the minister came down hard on the platform over its reluctance to comply with the new norms.
“There are numerous queries arising as to whether Twitter is entitled to safe harbour provision. However, the simple fact of the matter is that Twitter has failed to comply with the Intermediary Guidelines that came into effect from the 26th of May,” Prasad said.
He also said that Twitter was given multiple opportunities to comply with the same, however it has “deliberately chosen” the path of non-compliance.
Observing that the culture of India varies like its large geography, he said in another tweet: “In certain scenarios, with the amplification of social media, even a small spark can cause a fire, especially with the menace of fake news. This was one of the objectives of bringing the Intermediary Guidelines.”
“What happened in UP was illustrative of Twitter’s arbitrariness in fighting fake news. While Twitter has been over enthusiastic about its fact checking mechanism, it’s failure to act in multiple cases like UP is perplexing & indicates its inconsistency in fighting misinformation,” he said.
Prasad said that it is astounding that Twitter which portrays itself as the flag bearer of free speech, chooses the path of deliberate defiance when it comes to the intermediary guidelines.
“Further, what is perplexing is that Twitter fails to address the grievances of users by refusing to set up process as mandated by the law of the land. Additionally, it chooses a policy of flagging manipulates media, only when it suits, its likes and dislikes,” he said.
Further, in another development, official sources have said that Twitter has lost its status as intermediary platform in India as it has not complied with new guidelines.
ICICI Bank launches ‘ICICI STACK for Corporates’
The ICICI Bank on Wednesday announced the launch of ‘ICICI STACK for Corporates’, a comprehensive set of digital banking solutions for corporates and their entire ecosystem including promoters, group companies, employees, dealers, vendors and all other stakeholders.
The wide range of 360-degree solutions enables corporates to seamlessly meet all banking requirements of their ecosystem in an expeditious and frictionless manner. With this launch, ICICI Bank aims to be the preferred banking partner for companies and their entire ecosystem.
The environment in which corporate customers operate is becoming increasingly dynamic and competitive with accelerated digital adoption transforming every business. In this ever-changing environment, a banking partner, which can serve not only the corporates but also the entire ecosystems where they operate in, adds significant value to corporate customers, the bank said in a statement.
With this backdrop, the Bank has created ‘ICICI STACK for Corporates’ to serve the companies and their ecosystem by bringing the full bank to the customers, it added.
A first-of-its kind initiative, the ‘ICICI STACK for Corporates’ provides customised digital banking services to companies in over 15 leading industries– such as financial services, IT/ITES, pharmaceuticals, steel to name a few– and their entire ecosystem. Armed with the Bank’s digital platforms, these services can further be tailor-made for companies within an industry.
The four main pillars of the ‘ICICI STACK for Corporates’ are: digital banking solutions for companies; digital banking services for channel partners, dealers and vendors; digital banking services for employees and curated services for promoters, directors and signatories.
In order to supplement these digital efforts, ICICI Bank has opened eight ecosystem branches — five in Mumbai and three in the National Capital Region (NCR). It plans to launch another four in this financial year.
Vishakha Mulye, Executive Director, ICICI Bank said, “In an increasingly competitive and dynamic environment with rapid digital transformation impacting every industry, corporates look towards a banking partner, which can offer the breadth and depth of solutions for the entire ecosystem. With an objective to cater to the ecosystem of every corporate, we have launched a digital ‘ICICI Stack for Corporates’ with many industry first features. It offers banking solutions to corporates with backward and forward integration for their entire network of employees, dealers, vendors and all other stakeholders. We look forward to partnering with our customers for the banking needs of their entire ecosystem and unlock the full potential.”
Brent may test $78-$80 levels, support at $68-$70 levels: Emkay
Petrol. (File Photo: IANS)
Brent crude oil prices may test higher levels of $78-$80, and the support may be at USD 68-70 level, according to a study by Emkay Wealth Management.
But the rise may be, to a certain extent, limited by the strength in the US Dollar against other currency majors, the study added.
One major factor that dominated oil markets is the possibility of a nuclear deal between the US and Iran, and also better relations between the two countries, based on the reported talks between the two parties. This would mean that the supply from Iran will be in the markets as soon as such a pact is reached. Therefore, the prices should naturally come down.
But there is a strong view that oil prices may start going up, anticipating this supply in the near future, Emkay said.
One of the seasonal factors is that during and immediately after the summer in the northern hemisphere the number of people who would take to the highways moving to holiday destinations is quite large, and this keeps the prices high. This is one reason that may support prices to remain high.
It is also worth noting that the recovery in economic activity in the US and Europe is on course, and the same may be true of the leading Asian countries too. This may also support higher oil prices though demand in Asia is yet to go back to the pre-pandemic levels, the company’s study said.
The production in the US which was at 13 million barrels per day just before the pandemic has touched almost 11 million barrels per day recently. Therefore, restoration of supply as well as demand is happening.
Overall economic conditions warrant higher consumption and therefore, higher prices. Again, much would depend on the stance taken by OPEC+ which may be meeting soon. Russia is now in sync with OPEC in achieving the production cuts which the OPEC had envisioned earlier.
A related matter is the enhanced climate activism seen in the recent past and the likely attempts at containment of carbon emissions by oil companies and producers. It is gathering pace and it is good for the environment and posterity. It also means higher prices for oil as we start implementing the governance standards on climate. The extent to which renewable energy or electricity could replace the traditional sources is limited in the initial stages, and in fact, many believe that the common man may not be able to afford the costs associated with electric vehicles.
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