A fresh challenge for GST(Goods and Service Tax) Council Only Prayers can Solve

It's Faith Vs Logic As Centre Fixes Goods And Service Tax (GST) Rates Ahead Of July Rollout

The GST Council has made puja items exempt from tax, but needs to decide what articles will be included in the category 

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The GST(Goods and Service Tax) Council has resolved many ticklish economic issues since its inception in September. But now it faces a faith versus economic logic clash.
In its last meeting in Srinagar on May 18, the council took a giant step forward by clearing tax slabs for 1,211 items. Essential items and items of daily use were exempted from tax. Luxury items and not so essential items were divided under three slabs. While some protested the hike in the tax slabs, others welcomed the scale-down.
But the government was caught unawares by an objection of a different kind:  There was no clarity over puja and hawan material. Several organisations rose in protest, asking  how incense sticks could be put under the 12 per cent slab, while meat was exempt from taxes.

The government acted promptly. By evening, the Central Board of Excise and Customs issued a clarification saying, "Puja samagri (items) including havan samagri will be under 'Nil' category. However, the exact formulation for the same is yet to be finalized".

A senior finance ministry official said, "The category has been put under the 'Nil' tax list. But what items will be part of that category is yet to be decided. That call can't be taken by the government, so the issue will go to the GST council meet in June".

This means the council, which is scheduled to discuss issues like tax slabs for gold and bidis, will have to sit extra time to finalise what every citizen uses during prayers.  The matter will be tough to resolve. Even if some items are put under this category, religious groups are asking for more.

Prashant Pandey, the convenor of the Sanatan Mandir Association Uttar Pradesh said, "Meat and foodgrain are essentials. They are used daily, so they have been out on the zero tax list. But for millions of Hindus, incense is a daily item. We want agarbattis to be included to the category of zero tax items".
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 Source: http://bit.ly/2rn5kns

 

Government extends service tax return filing date to April 30 - Things to Know While Filing Tax Returns this Year

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The Centre has extended the last date for filing service tax return by five days to 30 April, in a relief to lakhs of service providers. “The Central Board of Excise and Customs (CBEC) hereby extends the date for submission of form ST-3 for the period from 1 October to 31 March 2017, from 25 April to 30 April 2017,” the apex policy making body of the indirect tax department said in an office order.

Every registered service tax assessee has to file service tax return in form ST-3 on a half-yearly basis before the due date to avoid penalty. For filing returns for the period April-September, the due date is 25 October, while for October-March it is 25 April.

The CBEC said that the due date is being extended as the assessees faced “intermittent difficulties” in accessing the Automation of Central Excise and Service Tax (ACES) website on 25 April. This, CBEC said, is “circumstances of a special nature” for which the last date for filing is being extended. As per norms, the returns have to be filed online on www.aces.gov.in.

While return is filed half-yearly, the service tax collected by the assesses has to be deposited with the government on a monthly or quarterly basis. Tax experts in India voiced concern over whether the Goods and Services Tax Network (GSTN) portal would be able to take the load of all the tax payers which would include not only service providers, but also traders and manufacturers.

The government is asking existing excise, service tax and VAT assessee to shift to the GSTN portal for payment of tax and filing returns. GST, which will unify 10 local taxes, is expected to kick in from 1 July.

Nangia and Co Director-Indirect Taxation Rajat Mohan said return filing under GST regime would necessitate much more data in terms of invoices, debit notes and credit notes that would be matched online. “After witnessing this extension of due date for filing service tax return, my concern is the government system might not be fully geared up for such large pool of tax payers and in terms of data requirement in returns,” Mohan said.

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What does GST hold for Indian youth?

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 After a long wait we finally have the GST law ahead of us and broadly know what it would look like. The unified tax reform is set to increase nation's GDP by 2% and enable India Inc to reach new heights. With July 2017 around the corner, businesses all over are figuring out how to be GST-compliant. In the midst of this hustle, I am keen to see how the transformative reform will go down with over 65% of our population, that is the youth below the age of 35 years.

How pocket-friendly will GST be for youngsters?

A 5-tier slab rate structure of 0, 5, 12, 18 and 28% has been agreed upon by the GST council, with lower rates for essential items and the highest for luxury and de-merits goods that would also attract an additional cess.

This means essential items, including food that till now constituted about 50% of the consumer inflation, will be taxed zero, thus keeping a check on inflation. All consumer-centric companies will stand to gain with respect to supply chain and logistics. Indirect tax rate for a range of consumer goods such as FMCG products, personal care, is likely to come down to 18% from the earlier 21%-22% on an average. This will lead to higher purchasing power among consumers. India's youth, being the biggest chunk of this set of consumers, are going to gain from this change.

With entertainment taxes becoming a part of GST, movie ticket, theatrical performances and dining out may also become more pocket friendly in most states.

The automobile sector, another industry that is primarily youth driven, is expected to be the biggest beneficiary of GST implementation. Currently, two-wheelers, small cars and commercial vehicles witness tax outgo of 27 percent. With the introduction of GST, a standard of 18% would be levied, resulting in a 9% reduction which could then be utilized in reducing vehicle prices and stimulate demand.

On the other hand, during the transition phase the youngsters should budget for some increased pocket pricking on telecom services like mobile and internet bills, and electronic products like smartphones, laptops and computers. Services like WiFi and DTH services, online booking of air travel may dearer too. Aligning with the government's negative outlook towards de-merit goods, tobacco, cigarettes, pan masala and aerated drinks shall witness the highest rate of 28% tax rate.

Though pre-primary and higher secondary education services will remain tax-free, higher education in private institutes may turn out to be costlier by about 3%, moving from the earlier service tax of 15% to the new GST slab of 18%. The benefits of such a move are debatable, as the reform is clearly skewed towards favoring government-provided education over private.

 Growth in the job market

GST implementation is expected to organize the unorganized players by bringing them into the tax ambit. This should reduce the price gap between organized and unorganized sector. There are about 3 crore MSMEs which provide employment opportunities to more than 90% of the youth. Though financial gain of this sector by GST is widely debated, the likelihood of this sector getting more organized is higher under GST. Employment in organized sector is going to be a better proposition for the youth than remaining employed in an unorganized sector.

Original Source: http://bit.ly/2pcLRC1 

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How to save service tax?

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As the name reveals, it is the tax on services that one person provides to another person. Service tax is nothing but the tax we have to pay for using the different services. For example, when we take dinner in a restaurant and then we have to pay bills that are nothing but the service tax. There are many ways to save services tax (like LIC policies, medical insurance, charities, etc.). Further, we discussed them one by one. But before we talk about how to save service tax, one thing I want to ask that, Is saving service tax is good for our country?

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Service tax is a backbone of a country & the main source of government revenue and it also affects the development of a country because if the government does not have a proper revenue, then they will not be able to execute their plans for the development of the country. In my opinion, YES, if any option is available for us and if it is beneficial then we must use it.
For saving our tax, we should plan our policies for this. There are many sections in our constitution that helps us deduct our taxes. We discuss them one by one.
Under the section 80C, LIC insurance premium paid in order to insure our family for any future incidence. This can also help us to save our taxes and reduces about 20% of the amount of insurance into tax amount.
Under the section 80D, Medical insurance premium is undoubtedly one of the best investments. It can cover for comprehensive hospitalization expenses related to accident and sickness and insure us and our family for any other medical problems. It also deduct our taxes up to 15000 to 20000 Rs for the age below 60 and up to 40000 Rs for the age above 60.
Under section 80EE, you can claim deduction in your tax amount for interest payments towards your home loans and tuition fee of your children. If someone takes educational loans for his/her children then he would also claim a deduction of the amount of loan interests from tax amount.
Under section 80G, you can claim deduction for 50% to 100% of donations made by you to a charitable institution. The total deduction for cash donation should not exceed the 10% of your gross income.
With the help of all these methods, any person can reduce his service tax without breaking any of the laws.
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