 |
|
FM hints at rollback of tax on cash withdrawal
Experts upbeat on new savings proposals
Budget proposals to delay ethanol-blended petrol project
Aviation Minister wants cheaper ATF for domestic operations
Uttaranchal eases norms for beer bars
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||
|
Virbhadra warns of hard fiscal measures
Capital Bank offers free insurance
Auto
Scene
|
|
FM hints at rollback of tax on cash withdrawal
New Delhi, March 1 Though Chidambaram stoutly defended the banking transaction tax as an “anti-black money” measure rather than a revenue raising one, he gave enough indication yesterday that the government was open to revising the tax amount. There are reports that the cash withdrawal amount may be raised to Rs 50,000 from the proposed Rs 10,000 liable for the banking transaction tax of Rs 10 to prevent harassment to honest taxpayers and depositors. At an interaction with economists here today, when asked about the proposed Fringe Benefit Tax on perks, he said, “these are our proposals and suggestions, which are broadly accepted. We’ll go into them one by one. But if you point out that there are some things to be cleaned up, we’ll certainly look into it. “Large amount of cash is withdrawn for ostentatious purposes and it disappears into a black hole. The idea behind the Rs 10 tax is to keep a tax trail,” he said. “I am more amused than concerned. It is not intended to be a revenue-raising measure but an anti-tax evasion measure,” he said. Nobody is being penalised through this measure, he said but added, “I will go by what Parliament decides on this.” The Finance Ministry also clarified that the proposed tax would come only after the passage of Finance Bill and not from March 1 as feared in certain quarters.
— PTI
|
|
Experts upbeat on new savings proposals
New Delhi, March 1 At present, the personal income tax assessees can avail themselves of rebates under Section 88 in the several savings instruments, including life insurance
premia, national savings certificates (NSCs), superannuation funds and tuition fees, among others. The major tax savings investment options at present available to taxpayers under Section 88 are: Life insurance premia, provident funds, superannuation funds, post office savings bank deposits, securities of the Central government, National Savings Certificates (NSCs), ULIP of UTI and LIC Mutual Funds, units of mutual funds or UTI, pension funds of a mutual fund or UTI, deposit scheme of NHB, deposits with HFCs, local development authorities, tuition fees are exempted. Consider the following example: Assuming an individual has annual income of Rs 2,00,000. In the current financial year (2003-04), his total tax liability without any investment in tax-savings instruments would be Rs 34,000. He has the option of investing up to Rs 70,000 in various schemes under Section 88 (LIC premia etc.). In addition, he had the option of saving a maximum of Rs 30,000 in infrastructure Bonds and up to Rs 10,000 in designated pension funds as allowed under Section 80CCC. If he had invested in all these, he would have been able to avail himself of a combined tax rebate of Rs 18,000. This would, thus, still leave him with a tax liability of Rs 16,000. “Under the new proposals, rebates available under Section 88 has been eliminated and instead will be available under a different Section (Section 80 C). There will be no sectoral caps now. The person can invest an amount of Rs 1,00,000 in LIC permia alone, in NSCs alone, in pension funds, infrastructure bonds or he can combine all schemes to create a portfolio of savings instruments”, Delhi-based investment adviser Avnish Kapoor said. Moreover, every taxpayer will now be allowed a consolidated limit of Rs 1 lakh for savings which will be deducted from the income before tax is calculated. “This means the same person with an annual income of Rs 2,00,000 would not have to pay any taxes in 2005-06 if he invests Rs 1,00,000 in any of the instruments. This is because the threshold exemption limit has been increased to Rs 1 lakh, meaning that his tax would be calculated only on the balance Rs 1,00,000. Since he has already invested a like amount in tax savings instruments, this would also be deducted prior to calculating his tax liability,” Mr Kapoor said. Mr Sarvesh Sharma, another Delhi-based tax consultant and investment adviser, said the new proposals would also benefit the high-income class. In addition, the disappointment of the salaried class notwithstanding, the abolition of the standard deduction has actually put the businessmen on a par with salaried individuals. “Earlier, there was no standard deduction for business persons, although the same was available to salaried persons”, Delhi-based Chartered Accountant I. K. Chopra said.
|
|
Budget proposals to delay ethanol-blended petrol project
New Delhi, March 1 Petroleum Minister had already deferred the project due to shortage of ethanol in the country and the subsequent rise in its prices. The previous NDA government had announced to introduce 5 per cent ethanol-blended petrol across the country during 2003-04 and up to 10 per cent ethanol-mixed petrol in the next phase. The sugar industry has maintained that after the fall in sugar production over the past three years, the Budget proposals would force them to pass on the duty on the consumers. Currently, molasses prices are hovering around Rs 4000 per tonne. Oil companies have found it difficult to purchase ethanol from the domestic or international market at competitive price for blending with petrol. Petroleum Minister Mani Shankar Aiyar observed that at the prevailing ethanol prices, it would not be “economically feasible for the oil marketing companies to implement the ethanol-blending project.” Ethanol blending with petrol was likely to result in financial savings worth millions of dollars, less pollution and benefits to the sugar producers. A parliamentary panel has already taken a serious view of the ministry’s failure to provide ethanol-blended petrol across the country by the end of fiscal 2004-05 and the delay in launching the bio-diesel fuel plan. In its report submitted to Parliament, the parliamentary committee attached to the ministry has stated that the delay “indicates faulty planning and lack of seriousness in the approach of the government to such a vital issue.” The Standing Committee lamented that despite an increase in refining capacity, the country was dependent on oil imports by up to 70 per cent of the total consumption. “The government should intensify its efforts to bring down this percentage to about 60 per cent in a time-bound manner.” Industry experts maintained that the soaring international crude oil prices, now touching $ 48 per barrel, were also followed by rise in international ethanol prices thus discouraging the oil companies to mix ethanol in petrol and diesel. Several countries, including Brazil and the USA, have been successfully using both ethanol-blended petrol and bio-diesel for transportation. At present, about 40 per cent of petrol and diesel are consumed by the transport sector and the government had started studying the feasibility of using ethanol in a higher proportion in petrol and diesel. The parliamentary panel in its report on demands for grants (2004-05) had asked the government to cover the country with five percent ethanol-blended petrol by the end of 2004-05. It has been informed by the government that this too would not be feasible because of ethanol shortage, panel report said.
|
|
Aviation Minister wants cheaper ATF for domestic operations
New Delhi, March 1 The government had yesterday in the Union Budget decided to treat ATF as deemed export for international operations of designated Indian carriers. Civil Aviation Minister Praful Patel today welcomed the government’s proposal to do away with central sales tax on ATF and hoped that the Finance Minister would take further steps in this Budget to lower the tax burden on ATF for domestic aviation use. In the Budget, Mr Chidambaram has proposed amending the CST Act 1956, to declare the sale of ATF to a designated Indian carrier for its global operations, enabling them to purchase the fuel without paying the CST. The ATF cost now accounts for over one-third of the total cost of an air ticket in the domestic sector against the global level of 15 per cent. Sales tax on ATF is charged by state governments and varies from a high of 39 per cent to four per cent. Besides, all airlines pay a central excise duty of eight per cent which has not been reduced in the budget 05-06. The Finance Bill 2005 said “if any designated Indian carrier purchases ATF for the purposes of its international flight, such purchase shall be deemed to take place in the course of the export of goods out of the territory of India” and hence would be exempted from CST. The proposal, which would come into effect from April 1, would lower the cost of ATF for foreign operations and provide a level-playing field not only to Air India and Indian Airlines vis-a-vis foreign carriers, but also to newly designated carriers Jet Airways and Air Sahara, besides Air India Express, who have been allowed to fly abroad. But despite this reduction in cost, these carriers would still be paying higher for ATF than their global competitors as they would have to pay central excise duty of eight per cent, leading to a sizeable price differential. Meanwhile, public sector airlines Air-India and Indian Airlines are looking at hiving off their ground handling and maintenance, repair and overhauling wings by forming joint ventures with foreign firms with a view to make them independent profit making centres. Mr Patel said that the proposal for the same had been cleared and the process was likely to be completed and made operational by the end of the year. He said that the two
airlines were also working on their IPOs and would appoint financial consultants by the end of the year to infuse more equity.
|
|
Uttaranchal eases norms for beer bars
Dehra Dun, March 1 With the lowering of the licence fee, the government looks to get better revenue besides attracting tourists, Excise Secretary B.C. Chandola said. The state Cabinet meeting took the decision during a meeting recently. The licence fee for beer bars has been slashed from Rs 50,000 to Rs 30,000 per year. The move would help not only the private entrepreneurs but also the state-run Garhwal Mandal Vikas Nigam that has plans to set up beer bars at popular tourist spots. The government has also relaxed the operating hours of the beer bars from 10 PM to 11 PM. The government has set a target of Rs 330 crore for the coming financial year, officials said. Last year’s revenue collection has been Rs 241 crore against a target of Rs 300 crore as of now, officials said.
|
|
Virbhadra warns of hard fiscal measures
Shimla, March 1 Making a suo motu statement in the Vidhan Sabha to apprise the members about the report of the commission today, he said the total transfers from the Centre to the state for the 2005-10 period would be Rs 14,450 crore as against Rs 7,460 crore recommended by the 11th Finance Commission (EFC), representing a quantum jump of 93.73 per cent. It was a more favourable proposition as the EFC recommended an increase of only 56.60 per cent over the 10th Finance Commission. Giving details, he said the non-plan revenue deficit grant was up from Rs 4,549 crore recommended by the EFC to Rs 10,202 crore, a hike of 124 per cent, and during 2005-06 the state would receive Rs 2,164 crore under this head, a jump of nearly 300 per cent over the 2004-05. Besides, the share in central taxes would bring Rs 3,203 crore during the period. In a significant departure from the past, the TFC had separately made recommendations for maintenance of roads (Rs 261 crore) and bridges and public building (Rs 147 crore). It had also accepted the state’s request for providing us incentives for protecting the forests and provided a sum of Rs 20 crore over the award period. However, it was a meagre amount compared to requirement. The commission had also provided a grant of Rs 10 crore for preservation and protection of historical monuments, archaeological sites, public libraries, museums and archives and improving the tourist infrastructure. It had also addressed special problems not specified in the terms of reference and provided Rs 12 crore for Sanjauli bye-pass road and another Rs 38 crore for augmenting the Shimla water supply. Adopting a normative approach for the state revenues were projected to grow at 16.64 per cent based on the trend growth rate in Gross State Domestic Product (GSDP) which was very stiff target and much more than the forecast. It did not recognise that different taxes target different segments of the economy and society and in many cases past trends were unlikely to be sustained. Similarly, the commission made some clearly unrealistic assumptions about interest and dividend receipts from state Public Sector Undertakings (PSU’s), even after it was made clear that there were welfare and development oriented and not commercial entities. Similarly, receipts from irrigation had been hiked up considerably on the assumption that cost recovery rates must progressively reach 90 per cent of the cost incurred on operation and maintenance. The state had forecast its own tax and non-tax receipts at Rs 9,788 crore over 2005-10 whereas the commission had assessed them to be Rs 12,209 crore, an excess of Rs 2,422 crore. In overall terms the state had projected a pre-devolution non-plan revenue deficit of Rs 31,553 crore but the TFC, pegged it at Rs 13,406 crore, thus restricting the pre-devolution projections of non-plan revenue deficit to the extent of 42.49 per cent.
|
|
Capital Bank offers free insurance
Chandigarh, March 1 The bank, which operates in the districts of Hoshiarpur, Kapurthala and Jalandhar, has entered into a tie-up with ICICI Prudential and Bajaj Allianz to offer life and non-life insurance products. Announcing this today, the bank’s Managing Director, Mr S.S. Samra, said the Capital Bank has achieved a business of Rs 225 crore and a customer base of 48,000 during a short span of five years. It proposes to expand in the districts of Ludhiana, Nawanshahr and Ropar with the approval of the Reserve Bank of India. The bank opened a state-of-the art branch in Jalandhar yesterday. It was inaugurated by Rana Gurjit Singh, MP. The Jalandhar branch will provide extended banking hours seven days a week with facilities to operate lockers and instant draft making.
|
|
Auto Scene
New Delhi, March 1 The price of the Corolla will range between Rs 9.73 lakh and Rs 11.76 lakh (ex-showroom Delhi). The petrol version of Innova is priced between Rs 6.69 lakh and Rs 9.31 lakh (ex-showroom Delhi), while diesel variant is priced between Rs 7.29 lakh and Rs 9.91 lakh. Meanwhile, Honda Siel Cars India Ltd today announced reduction in prices of its models Honda City and Honda Accord following customs duty cut announced in the budget. As per the price cut effective from today, Honda City 1.5 EXi would cost Rs 6,49,500; Honda City GXi would cost Rs 6,99,500 and City CVT would be priced at Rs 7,59,500 (ex-showroom Delhi). Honda Accord VTI-L manual variant would now cost Rs 14,71,000, while the automatic variant would be priced at Rs 15,42,000. Honda Accord V6 (A/T) would now cost Rs 16,99,001.
Maruti sales
Consumers’ dilemma on whether to buy cars before or after the Budget has hit sales of Maruti Udyog Ltd (MUL) in February as it registered a mere 3.2 per cent rise in vehicle sales to 43,603 units, including 3,777 units of exports, in the past month against 42,263 units a year ago. The auto market leader today said its car sales in February were affected as customers postponed purchase expecting a reduction in excise duty on cars in the Budget 2005-06. It was not the case in February 2004 as the Budget was presented in July last, Maruti added. Last month, Maruti’s volume in the domestic A2 segment grew by 22 per cent, while in the A3 segment by 55 per cent and in the C segment by 14 per cent. The sale of entry-level car Maruti 800 dipped by 41 per cent to 8,038 units against 13,518 vehicles a year earlier, the company said, adding that it had seen a 30 per cent fall in volume sales between April-February 2004-05 at 1,06,010 units as compared to 1,52,021 last year.
Tata Xover
In a bid to make further inroads in the global market, Tata Motors today unveiled the Xover, a crossover vehicle concept, showcasing the company’s commitment to innovate and gear up for newer technologies. Presenting the vehicle at the 75th Geneva Auto Show, Tata Group Chairman Ratan Tata said it represented the company’s idea of a modern crossover, a strong emerging segment globally. “The Tata Xover demonstrates Tata Motors’ desire and commitment to innovate and address new market segments,” Tata said. This is the eighth straight year for Tata Motors, the flagship company of the $ 14.3 billion Tata Group, at the auto show where it shares space with bigwigs like General Motors, Ford, Toyota, Honda and BMW. About 900 brands from over 30 countries are displaying products and launch of new models and unveiling of futuristic concept cars is expected at the event, which ends March 13.
— Agencies
|
bb
RIMT ESI scheme Gillette Blaupunkt |
| HOME PAGE | |
Punjab | Haryana | Jammu & Kashmir |
Himachal Pradesh | Regional Briefs |
Nation | Opinions | | Business | Sports | World | Mailbag | Chandigarh | Ludhiana | Delhi | | Calendar | Weather | Archive | Subscribe | Suggestion | E-mail | |
