by admin | May 25, 2021 | Corporate, Corporate finance, Corporate Governance, Corporate Jobs, Employment, Private Jobs
New Delhi : With middle-class apathy on the rise, Finance Minister Arun Jaitley may double the income tax exemption threshold for the salaried from the present Rs 2.5 lakhs to Rs 5 lakhs while also reinstating tax-free status for medical expenses and transport allowance, providing some relief to the section already under strain since demonetisation.
Though propriety demands that not too many policy changes should be made in a vote on account budget, the BJP government is apprehensive of the possibility of a middle-class backlash in the impending general elections.
Hence the plan to streamline tax slabs, which in any case are in consonance with the coming Direct Tax Code, government sources told IANS.
The problem that may manifest itself is that the Union Budget will precede the unveiling of the Direct Tax Code Report on February 28. Tinkering with the tax rates before the release of the report will make it contentious.
The new Direct Tax Code will try to bring more assessees into the tax net, make the system more equitable for different classes of taxpayers, make businesses more competitive by lowering the corporate tax rate and phase out the remaining tax exemptions that lead to litigation. It will also redefine key concepts such as income and scope of taxation
At the moment, income up to Rs 2.5 lakh is exempt from personal income tax. Income between Rs 2.5-5 lakh attracts 5 per cent tax (see table), while that between Rs 5-10 lakh is levied with 20 per cent tax. Income above Rs 10 lakh is taxed at 30 per cent. Rs 5 lakh exemption is only applicable to individuals of over 80 years.
Also, tax free medical expenses up to Rs 15,000 and transport allowance up to Rs 19,200 per annum has been replaced with a Rs 20,000 standard deduction for those earning above Rs 5 lakh last year. This will benefit tax payers to the tune of Rs 12,500 annually which is not much but can be viewed as a sentiment buster.
A fatigued BJP dispensation realises that as the incumbent it will have to fight off varied challenges.
With acute farm distress, middle class backlash, massive spike in unemployment data and rising Dalit anger taking its toll on the BJP, it would like to unleash a slew of course correctives. The 10 percent quota for upper castes was part of this process to appease vote banks. But this was an executive decision adopted by parliament, tinkering with the tax structure similarly is a legislative decision.
Income Tax Slabs for Individual Tax Payers & HUF (Less Than 60 Years Old) for FY 2018-19 –
Income Tax Slabs Tax Rate
Income up to Rs 2,50,000* No tax
Income from Rs 2,50,000 – Rs 5,00,000 5%
Income from Rs 5,00,000 – 10,00,000 20%
Income more than Rs 10,00,000 30%
—IANS
by admin | May 25, 2021 | Corporate, Corporate finance, Corporate Governance, Economy, Finance, News, Politics
New Delhi : Finance Minister Arun Jaitley on Monday hinted that the country may eventually have a single standard rate of GST adding that the 28 per cent slab will soon be phased out, except on luxury and “sin goods”.
He noted that the standard rate could be between the 12 and 18 per cent.
“A future roadmap could well be to work towards a single standard rate instead of two standard rates of 12 per cent and 18 per cent.
“It could be a rate at some mid-point between the two. Obviously, this will take some reasonable time when the tax will rise significantly,” Jaitley said on a Facebook post.
The country should eventually have a GST which would have only slabs of zero, five per cent and standard rate with luxury and sin goods as an exception, he added.
Regarding the highest tax slab of 28 per cent, the Minister said: “With the GST transformation completed, we are close to completing the first set of rate of rationalisation i.e. phasing out the 28 per cent slab except in luxury and sin goods.”
—IANS
by admin | May 25, 2021 | Economy, Finance, News, Politics
New Delhi : Finance Minister Arun Jaitley on Saturday said that six items have been removed from the 28 per cent tax bracket under the Goods and Services Tax (GST) regime.
There were 34 items in the 28 per cent tax bracket which included luxury and ‘sin goods’ till now. However, the GST Council in its meeting on Saturday decided to take out 6 items from this list.
Only 28 items now remain in the 28 per cent GST tax bracket.
—IANS
by admin | May 25, 2021 | Corporate, Corporate finance, Corporate Governance, Economy, Finance, News, Politics
Mumbai : Admitting to differences with Urjit Patel, who quit as RBI Governor, Finance Minister Arun Jaitley on Thursday said the government is the sovereign body for managing the economy and RBI Governors have exited if differences were not settled.
“If you look at the history of the RBI, you had several incidents in the past where governments have had a different view from what the RBI has had and then those differences either get settled or the Governors have made way,” he said at a conclave here.
Addressing the India Economic Conclave 2018 via satellite link, Jaitley said the government had a particular opinion on two or three major issues relating to credit and liquidity in the market but was failing to communicate with the RBI and getting them addressed.
“Every person involved in some kind of a business activity, whether its financial, manufacturing or services sector or the MSME sector or even in agriculture, will tell you that they were facing difficulties as far as credit and liquidity is concerned,” the Minister said.
Jaitley said the RBI has the responsibility as far as credit and liquidity is concerned and it is not an issue of confrontation if the “sovereign accountable government” forces the issue for a discussion and redressal by the RBI. Else, the government would fail in its responsibility.
“We are the sovereign government and most important stakeholder as far as management of the economy is concerned and therefore a discussion with an important institution… to tell it that it’s a part of your functions which you must seriously look at, how is it destruction of the institution,” he said replying to a query on the charge that the government was destroying institutions.
Quoting India’s first Prime Minister Pandit Jawaharlal Nehru’s letter to the then RBI Governor, he said, “The economic policy of the country is determined by the elected government. The RBI monetary policy functions are autonomous and independent but other policies of the RBI certainly must be in tandem with the economic policy of the country.”
He said if the government policy is to encourage the MSME sector, the credit policy of India cannot be, “No, we will not give credit to the MSMEs”. In live democracies, concerns of the market and the economy have to be communicated and addressed , he added.
Taking a dig at former RBI Governor Raghuram Rajan, who wrote the book “I Do What I Do”, Jaitley said, “It will be a dialogue of the deaf because you won’t be then giving the concerns to each other and not listening to each other.”
—IANS
by admin | May 25, 2021 | News, Politics
New Delhi : Finance Minister Arun Jaitley on Tuesday said that the Congress has scored a self-goal by dragging Prime Minister Narendra Modi’s parents into the election campaign. The BJP will be glad to fight the 2019 Lok Sabha elections if the Congress made it a contest between the “son of lesser known parents” and “someone who is known only for parentage rather than merit and competence,” he said.
In an article `What was the name of Sardar Patel’s Father’ on BJP’s website, he targeted Congress President Rahul Gandhi and said the weakness of dynastic parties is that their strength is co-existent with the strength of the present generation of the dynasty.
He sought to tear into the Congress by referring to the remarks of party leader Raj Babbar, who had talked of age of Modi’s mother in connection with the falling value of rupee, and to comments of another leader Vilas Muttemwar, who had said that nobody knew the name of Modi’s father.
“The debate whether India should be a dynastic democracy has been ignited by a self-goal of the Congress Party. The Prime Minister’s mother’s age was made a subject matter of the electoral debate. His father’s anonymity was commented upon as an inadequate credential of the Prime Minister. The argument given was that if you represent the legacy of a well-known family, it is a political point in your favour,” Jaitley said.
The BJP leader said Congress considers only a great surname as a political brand. “Millions of talented political workers who come from modest family backgrounds would fail by the Congress test of leadership. Merit, talent, ability to inspire and lead would not be a virtue.”
Jaitley said he asked his well-informed friends if they knew the name of Mahatma Gandhi’s father or Sardar Patel’s father or wife but none of them had a definitive answer.
Referring to contributions of Gandhi and Patel, he said no photograph of Patel’s wife or her details are available even after extensive research by modern day historians.
“The reason is simple. Decades of Congress rule, naming colonies, localities, cities, bridges, airports, railway stations, schools, colleges, universities, stadiums after one family was intended to declare the ‘Gandhis’ as India’s royalty.”
Jaitley said that after Sardar Patel’s death in Mumbai, the then Prime Minister Jawaharlal Nehru requested many of his cabinet colleagues that the best tribute to the Sardar would be to work on the day of his funeral and not go to Mumbai but the then Head of State and several union ministers defied the advice.
“The proposal for building his statue at Vijay Chowk was rejected. The country had to be satisfied with the installation of his statue at a traffic round-about on Parliament Street,” he said.
The BJP leader said many believe Sardar Patel was a farmer leader because of his participation in Bardoli Satyagraha but he was one of Ahmedabad’s most successful practising barristers.
“Panditji is passed off as a great lawyer though he never argued a single case in his entire career. He only went to court once for reasons of tokenism to sit behind senior lawyers led by Bholabhai Desai, who was arguing for the three INA officers in the mutiny trial inside the Red Fort,” Jaitley said.
The BJP leader said that dangers of officially glamourising one family at the cost of those who made a far greater contribution is dangerous both for the nation as also for the party to which they belong.
“The contribution of other great stalwarts like Patel and Subhash Chandra Bose is downplayed. Members of one family are projected as larger than life. The party adopts them as its ideology.”
He alleged that Nehru promoted Indira Gandhi as his successor and laid the foundation of India as a dynastic democracy.
He said when Sikhs were massacred in 1984, “communal polarisation against them was considered a legitimate electoral strategy.”
“Today anti-BJPism leads the Congress to a situation where it can tie up even with its political rivals and sympathise with the Maoists, separatists and disruptionists.”
He said the real strength of Indian democracy would be when the charismas of some families is completely shattered and parties, through a democratic process, throw up leaders of merit and competence.
“This was more than adequately proved in 2014 where most dynastic parties lost miserably. India of 2019 is different from India of 1971. If the Congress Party wants the 2019 elections to be between Prime Minister Modi, who is the son of lesser known parents and someone who is known only for his parentage rather than capacity, merit and competence, the BJP would gladly accept the challenge. Let this be the agenda for 2019.”
Modi had also targeted the Congress over its leaders referring to his parents during elections and said in one of his rallies that his father had passed away 30 years ago.
—IANS
