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nirmala sitharaman

FinMin To Monitor Revenue Daily From March 15

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Keen to keep government deficit within stated targets, the finance ministry will from March 15 start daily monitoring of the revenue receipts, including tax collections, as well as expenditure

Keen to keep government deficit within stated targets, the finance ministry will from March 15 start daily monitoring of the revenue receipts, including tax collections, as well as expenditure.

The move comes against the backdrop of a possible deferment of the initial public offering (IPO) of LIC, which was expected to fetch over Rs 60,000 crore, to the next financial year in view of the ongoing Russia-Ukraine war and its implication on Indian markets.

On the other hand, the government’s decision to bring back thousands of Indian students stranded in Ukraine will impose an additional burden on the exchequer.

According to officials, the daily monitoring of tax and non-tax revenue collections will help the government in taking timely corrective actions, wherever needed.

“The CBDT and CBIC have been asked to report flash figures up to the previous day latest by 12 noon. Besides, other non-tax and disinvestment receipts would have to be reported on a daily basis,” the official told PTI.

Officials said that the Controller General of Accounts (CGA) has been asked to provide daily revenue collection and expenditure figures of various ministries between March 15 and March 31 to the expenditure secretary.

The Central Board of Direct Taxes (CBDT) and the Central Board of Indirect Taxes and Customs (CBIC) are the apex bodies responsible for collecting direct and indirect taxes, respectively.

Likely deferment of LIC IPO along with additional burden on bringing back Indians stranded in Ukraine will put pressure on the fiscal deficit, which has already been raised in the Revised Estimates (RE) to 6.9 per cent of GDP, from 6.8 per cent estimated earlier.

The government has collected Rs 15.47 lakh crore in net tax revenue, which is 87.7 per cent of the full-fiscal target of Rs 17.65 lakh crore.

Similarly, non-tax revenue collections stood at Rs 2.91 lakh crore till January, or 92.9 per cent of the RE target of Rs 3.13 lakh crore.

However, the government has raised only Rs 12,423 crore from disinvestments so far this fiscal, against the revised target of Rs 78,000 crore. It has been banking on LIC IPO to meet the target.

The government’s total expenditure till January-end worked out to be Rs 28.09 lakh crore, as against the RE of Rs 37.70 lakh crore for the entire fiscal.

(PTI)

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Finmin Officials Hold Review Meeting With Infosys Chief

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In a statement on Thursday, the ministry said that Bajaj along with other senior ministry officials held a review meeting regarding the portal with Parekh.

Revenue Secretary Tarun Bajaj along with senior finance ministry officials on Thursday held a meeting with Infosys Managing Director Salil Parekh to review the performance of the new income tax portal.

More than 3.5 crore Income Tax Returns (ITR) have been filed so far for the financial year 2020-21 through the portal, which had faced glitches following which the ministry had directed Infosys to urgently address the issues.

Infosys has developed the new income tax e-filing portal ‘www.incometax.gov.in’.

In a statement on Thursday, the ministry said that Bajaj along with other senior ministry officials held a review meeting regarding the portal with Parekh.

As briefed by Infosys, various steps have been taken, including augmentation of the technical infrastructure and setting up of a dedicated war room to monitor the performance of the portal, it said.

According to the statement, Infosys has assured the ministry about its preparedness to ensure a smooth filing season to instill confidence among the taxpayers.

(PTI)

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Centre Earned Nearly Rs 8.02 Lakh Cr From Taxes On Petrol And Diesel: FinMin

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The minister was responding to queries on the hike in excise duty on petrol and diesel during last three years and the details of the revenue earned through various taxes on these fuels.

The Centre earned nearly Rs 8.02 lakh crore from taxes on petrol and diesel during the last three fiscal years, of which more than Rs 3.71 lakh crore was collected in FY21 alone, Finance Minister Nirmala Sitharaman informed Parliament on Tuesday.

The minister was responding to queries on the hike in excise duty on petrol and diesel during last three years and the details of the revenue earned through various taxes on these fuels.

The excise duty on petrol rose from Rs 19.48 per litre as on October 5, 2018 to Rs 27.90 a litre as on November 4, 2021. The duty on diesel rose from Rs 15.33 a litre to Rs 21.80 during the same period, Sitharaman said in a written reply in the Rajya Sabha.

Within this period, the excise on petrol fell from Rs 19.48 per litre as of October 5, 2018 to Rs 17.98 as of July 6, 2019; while excise on diesel reduced from Rs 15.33 to Rs 13.83 during the same reference period.

The excise duties on petrol and diesel were on a rising trajectory till February 2, 2021, to Rs 32.98 and Rs 31.83 respectively, before falling a tad and then declining further to Rs 27.90 a litre (petrol) and Rs 21.80 (diesel) as on November 4, 2021.

“The central excise duties, including cesses collected from petrol and diesel, during the last three years are: Rs 2,10,282 crore in 2018-19; Rs 2,19,750 crore in 2019-20 and Rs 3,71,908 crore in 2020-21,” Sitharaman said.

Just before Diwali this year on November 4, the government slashed the excise duties on petrol and diesel by Rs 5 and Rs 10 a litre, respectively.

This was followed by several states announcing a cut in the value added tax (VAT) on the two fuels.

(PTI)

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Number Of ATMs In India At Over 213,000: FinMin

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To a question on the target to install ATMs by 2022, he said the RBI has apprised that WLA operators are required to deploy a minimum of 1,000 ATMs every year and to maintain a deployment ratio of 1:2:3 for metro and urban, semi-urban and rural regions respectively”.

The number of ATMs across the country stood at over 2.13 lakh by the end of September this year, and over 47 per cent of these are in rural and semi-urban areas, the Finance Ministry said in Parliament on Monday.

According to the RBI data, scheduled commercial banks have installed 2,13,145 ATMs (automated teller machines) up to September 2021. In addition to this, 27,837 White Label ATMs (WLA) were also installed by WLA operators up to September 2021, Minister of State for Finance Bhagwat Karad said in a written reply in the Lok Sabha.

“Out of these, 47.4 per cent of the ATMs are installed in the rural and semi-urban centres,” Karad said.

To a question on the target to install ATMs by 2022, he said the RBI has apprised that WLA operators are required to deploy a minimum of 1,000 ATMs every year and to maintain a deployment ratio of 1:2:3 for metro and urban, semi-urban and rural regions respectively”.

He said the WLA scheme was introduced as an extended delivery channel for banking services, especially in tier III and VI centres.

(PTI)

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Over 3 Crore Income Tax Returns Filed For FY21: Finmin

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The number of ITRs filed per day is over four lakh and rising as the extended deadline of December 31 is approaching, an official statement said.

The Union finance ministry on Sunday said more than three crore income tax returns have been filed for the 2020-21 financial year so far and advised taxpayers who have yet to file their return to do so at the earliest. 

The number of ITRs filed per day is over four lakh and rising as the extended deadline of December 31 is approaching, an official statement said.

“The income tax department strongly urges all taxpayers to view their Form 26AS and Annual Information Statement (AIS) through the e-filing portal to verify the accuracy of the TDS and tax payments and avail of pre-filling of ITRs,” it said. It is important for taxpayers to cross-check the data in the AIS statement with their bank passbook, interest certificate, Form 16 and capital gains statement from brokerages in case of purchase and sale of equity/ mutual funds, etc, it said.

“Income tax return (ITR) filing has increased to 3.03 crore ITRs for AY 2021-22. As much as 58.98 per cent of these are ITR1 (1.78 crore), 8 percent is ITR2 (24.42 lakh), 8.7 percent is ITR3 (26.58 lakh), 23.12 percent is ITR4 (70.07 lakh), ITR5 (2.14 lakh), ITR6 (0.91 lakh) and ITR7 (0.15 lakh). “Over 52 percent of these ITRs are filed using the online ITR form on the portal and the balance are uploaded using the ITR created from the offline software utilities,” it said.

The process of e-verification through Aadhaar OTP and other methods is important for the income tax department to commence processing of the ITR and to issue refunds, if any. It is encouraging to note that 2.69 crore returns have been e-verified, of which more than 2.28 crore are through Aadhaar-based OTP, it said.

“In November, 48 per cent of verified ITRs 1, 2 and 4 have been processed on the same day. Of the verified ITRs, more than 2.11 crore have been processed and over 82.80 lakh refunds for AY 2021-22 have been issued,” it said. Taxpayers are urged to ensure that the bank account selected for credit of refund must have their PAN number linked to avoid refund failures, it added.

“Overall 8.33 lakh digital signature certificates (DSCs) have been registered. In the simplified process of DSC registration, any individual has to register his DSC only once and can use it across any entity where the individual is a partner, director, etc, without having to re-register against each entity or role,” it said.

(PTI)

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FinMin Notifies 12% GST On MMF, Yarn, Fabrics From 2022

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The taxation of inputs at higher rates than finished products created a build-up of credits and cascading costs.

The finance ministry has notified uniform 12 percent GST rate on manmade fiber (MMF), yarn, fabrics, and apparel, thereby addressing the inverted tax structure in the MMF textile value chain.

Currently, the tax rate on MMF, MMF yarn, and MMF fabrics is 18 percent, 12 percent, and 5 percent, respectively.
The taxation of inputs at higher rates than finished products created a build-up of credits and cascading costs. It further led to the accumulation of taxes at various stages of the MMF value chain and the blockage of crucial working capital for the industry.

The GST Council, chaired by Union Finance Minister Nirmala Sitharaman and comprising state finance ministers, had in its previous meeting on September 17 decided that the inverted duty anomalies in the textile sector would be corrected from January 1, 2022.

Giving effect to this decision, the Central Board of Indirect Taxes and Customs (CBIC) on November 18 notified 12 per cent GST rate for MMF, MMF yarn and MMF fabrics.

Experts said though there is a provision in GST law to claim the unutilised Input Tax Credit (ITC) as a refund, there were other complications and resulted in more compliance burden. The inverted tax structure caused an effective increase in the rate of taxation of the sector.

The world textiles trade has been moving towards MMF but India was not able to take advantage of the trend as its MMF segment was throttled by the inverted tax regime, they said, adding the correction in duty anomaly will help the segment grow and emerge as a big job provider.

EY Tax Partner Bipin Sapra said the rate changes in the textile industry are the first of the changes promised by the GST Council with an aim to rectify an inverted duty structure and bring an efficient tax structure for a given sector.

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FinMin To Start Process For Appointment Of MD, DMDs Of Rs 20K-Cr NaBFID

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The DFI will remain outside the purview of CAG, CVC and CBI, a move aimed at enabling faster decision-making.

The finance ministry will soon start the process for the appointment of managing director (MD) and deputy managing directors (DMDs) of the newly set up Rs 20,000 crore development finance institution NaBFID, to catalyse investment in the fund-starved infrastructure sector.

Last month, the government appointed veteran banker K V Kamath as the chairperson of the National Bank for Financing Infrastructure and Development (NaBFID) for three years.

According to sources, the finance ministry will soon intimate the Banks Board Bureau (BBB) about the appointment of MD and DMDs of NaBFID.

The Bureau will issue advertisements and undertake a selection process, sources said.

The BBB is the headhunter for state-owned banks and financial institutions.

The MD, DMDs and whole-time directors would not hold office after attaining the age of 65 years and 62 years respectively.

As per the National Bank for Financing Infrastructure and Development (NaBFID) Act 2021, the institution would have one MD and not more than three DMDs.

The government has committed Rs 5,000 crore grant over and above Rs 20,000 crore equity capital.

The central government will provide grants by the end of the first financial year. The government will also provide guarantee at a concessional rate of up to 0.1 per cent for borrowing from multilateral institutions, sovereign wealth funds, and other foreign funds.

The development finance institution (DFI) has been established as a statutory body to address market failures that stem from long-term, low margin and risky nature of infrastructure financing.

The DFI, therefore, has both developmental and financial objectives. To begin with, the institution will be 100 per cent government owned.

It will help fund about 7,000 infra projects under the National Infrastructure Pipeline (NIP) which envisages an investment of Rs 111 lakh crore by 2024-25.

The DFI will remain outside the purview of CAG, CVC and CBI, a move aimed at enabling faster decision-making.

The government expects the DFI to leverage this fund to raise up to Rs 3 lakh crore in the next few years.

During the pre-liberalised era, India had DFIs which were primarily engaged in the development of industry.

ICICI and IDBI, in their previous avatars, were DFIs. Even the country’s oldest financial institution IFCI Ltd functioned as a DFI.

In India, the first DFI was operationalised in 1948, with the setting up of the Industrial Finance Corporation of India (IFCI).

Subsequently, the Industrial Credit and Investment Corporation of India (ICICI) was set up with the backing of the World Bank in 1955.

The Industrial Development Bank of India (IDBI) came into existence in 1964, to promote long-term financing for infrastructure projects and industry.

nirmala sitharaman

Finmin Asks PSU General Insurers To Rationalise Branches, Cut Expenses

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The advisory of the ministry follows Parliament”s approval to a bill to allow privatisation of state-owned general insurers in August in line with the Budget announcement.

The finance ministry has asked public sector general insurance firms to rationalise branches and cut avoidable expenses to improve their financial health.

Of the four public sector general insurers, National Insurance, Oriental Insurance, and United India Insurance are loss-making. The outlier in this segment is New India Assurance.

The advisory of the ministry follows Parliament”s approval of a bill to allow privatization of state-owned general insurers in August in line with the Budget announcement.

The finance ministry has asked these companies to rationalise branches and also trim administrative layers wherever possible, sources said.

Besides, sources said, they have been asked to expand their business through a cost effective digital medium.

“Public sector general insurance firms are implementing various government schemes. Rationalisation of branches should not lead to hardship for the poor as they may have to travel long distances for settlement of their small claims for example cattle insurance or fasal bima,” General Insurance Employees All India Association general secretary K Govindan said.

As a stakeholder, the union raised these issues before the management of various companies, he said, adding, there should be presence of a branch in each district headquarter so that the poor don”t have to face any issue.

Finance Minister Nirmala Sitharaman in her Budget 2021-22 had announced a big-ticket privatisation agenda, including privatisation of two public sector banks and one general insurance company.

As part of the divestment strategy for the financial sector, the government has decided to go for a mega initial public offering (IPO) of Life Insurance Corporation of India (LIC) and residual stake sale in IDBI Bank during this financial year.

The government has budgeted Rs 1.75 lakh crore from stake sale in public sector companies and financial institutions during 2021-22.

Last year, the Union Cabinet decided to halt the merger process of three state-owned general insurance companies due to weak financial positions of these three companies. Instead, the government approved a fund infusion of Rs 12,450 crore to meet regulatory parameters.

As part of capital infusion exercise, the government approved raising authorised share capital of National Insurance Company Ltd to Rs 7,500 crore and that of United India Insurance Company Ltd (UIICL) and Oriental Insurance Company Ltd (OICL) to Rs 5,000 crore each.

The Rs 12,450 crore capital infusion approved by the Cabinet in July includes Rs 2,500 crore provided to these companies during 2019-20. During this year, the government infused Rs 3,475 crore while announcing infusion of the balance Rs 6,475 crore in one or more tranches. 

(PTI)