1. Commerce Ministry Moots Limiting Liquor Purchase to 1 Bottle at Duty-Free Shops
International travellers may be able to add just a single litre of liquor to their carts at an Indian airport duty-free shop next time they return from an overseas trip, as against the two litres allowed now. Cigarettes may also vanish from the duty-free shelves.
The measures are part of a set of proposals prepared by the commerce ministry to reduce imports of non-essential items. If accepted, finance minister Nirmala Sitharaman could announce them in the Union budget on 1 February.
“This is part of our drive to reduce unnecessary imports. We have also recommended to the finance ministry a hike in duties on 200 items we consider non-essential," a commerce ministry official said on condition of anonymity.
(Source: Livemint)
2. Budget 2020: PMO Tells FM Nirmala Sitharaman Not to Set Over Ambitious Targets
Finance Minister Nirmala Sitharaman, who is facing a tough task of driving the economy out of probably the toughest times, may not go overboard in setting growth target for FY21 in her second budget speech.
The minister perhaps would set the target for nominal GDP growth to 9.5-10 percent as she now doesn’t have the time for ‘picking optimistic target’ experiments, IANS reported citing sources as saying. Also, the Prime Minister’s Office (PMO), which is linked to the budget even at the micro-level has asked the Finance Minister to avoid having over-ambitious tax revenue and fiscal deficit targets, according to the report.
“This year, there will be a realistic assessment of the nominal GDP,” a source said along with tax revenue and fiscal deficit targets in order to avoid failing to meet them.
(Source: Financial Express)
3. No Wish for Laws Treating Businesses With Suspicion: FM Sitharaman
Finance Minister Nirmala Sitharaman has said the government had no wish for laws which treat every business entity with suspicion. This comes right after Tata Sons chairman N Chandrasekaran said business needs supervision but not suspicion. A sentiment the FM said she fully empathised with.
The government was working towards a desired environment in this regard and required business to work with it, she said.
Delivering the Nani Palkhivala Centenary Celebrations Lecture here, she said: “My first and earnest attempt, which continues till today, is to decriminalise everything to do with the Companies Law or related laws; the very point the Prime Minister keeps talking. And, I was very impressed, again when the Tata Group's head said the government should trust people, government should trust its own citizens.”
(Source: Business Standard)
4. India May Miss Tax Collection Target for 2019-20 by Nearly Rs 2.5 Lakh Crore: Ex-Finance Secretary
The government’s tax collection is likely to fall short of its estimate by Rs 2.5 lakh crore or 1.2 percent of GDP in 2019-20, former finance secretary Subhash Chandra Garg said on Sunday while calling for scrapping of dividend distribution tax.
Garg in a blog said that from the tax revenues perspective, 2019-20 is proving to be a dysfunctional year.
“Tax revenues to see shortfall of Rs 2.5 trillion (1.2 percent of GDP). Time to junk DDT and reform personal income tax,” he said. The government had budgeted gross tax revenues of Rs 24.59 lakh crore.
(Source: Financial Express)
5. USD 5 Trillion Economy Target Needs Doubling of Banking Credit: SBI Chairman
State Bank of India (SBI) chairman Rajnish Kumar on Sunday said banking credit would need to be doubled from the current level if India were to achieve its ambitious target of becoming a USD 5 trillion economy by 2024.
“At present, the Indian banking credit outstanding is around Rs 99 trillion and for India to become a USD 5 trillion economy, it needs to be at least doubled over the next 5 years,” Kumar said.
He observed that Indian banks had the capacity to cater to such high volume demand from industry and other sectors. Kumar was talking to journalists this afternoon during his two-day visit to the SBI Lucknow Circle.
(Source: Business Standard)
6. Future Group Scales Down E-Commerce Operations, Fires Employees
Kishore Biyani-led Future Group has scaled down its e-commerce venture, Retail 3.0, and laid off 350-400 employees, four former employees aware of the development said on condition of anonymity.
Two of them said the layoffs across roles in sales, product development, marketing and ground operations were carried out in the last few months. Future Group recently shuttered many of its EasyDay stores amid little traction for its EasyDay grocery app.
The closure of 140 EasyDay stores in November, which was reported by The Economic Times, was part of the same restructuring exercise, said one of the two people cited earlier.
(Source: Livemint)
7. Govt Likely to Abolish Dividend Distribution Tax in Upcoming Budget
The government is likely to abolish dividend distribution tax (DDT) in the upcoming Budget and may instead tax the shareholders receiving dividends, in a bid to help improve investor sentiment by addressing the multiplicity of taxes and bring down the effective tax rates for companies. The move will need changes in Section 115 (O) of the Income-tax Act.
DDT is levied on dividends that a company pays its shareholders out of its profits. It is currently charged at the rate of 20.55 percent, including a surcharge and education cess.
(Source: Business Standard)
8. Shapoorji Pallonji to Sell Power Project in Bangladesh, Cut Debt
Shapoorji Pallonji group, the debt-laden construction empire run by billionaire Pallonji Mistry, has put its gas-fuelled power plant in Bangladesh on the block to reduce debt, two people aware of the development said.
The group’s 225 megawatt (MW) Bhola power project in power-starved Bangladesh may be valued at around USD 270 million, one of the two people said, requesting anonymity. Standard Chartered has been hired to find a buyer for the Bhola power plant that is expected to be commissioned soon.
Experts said an assured power purchase agreement for 22 years with the Bangladesh Power Development Board is expected to help Shapoorji Pallonji get a better valuation for the asset.
(Source: Livemint)
9. Govt Considering Levying Specific Rate of Excise Duty on Aviation Turbine Fuel
With no sight of including jet fuel in Goods and Services Tax (GST) in near future, the government is considering levying specific rate of excise duty on aviation turbine fuel (ATF) in place of current ad valorem rates to insulate its prices from cascading effect in times of volatile prices.
ATF presently is chargeable at 11 percent ad valorem rate of excise duty. Concessional rate of 2 per cent is applicable for ATF sold under Regional Connectivity Scheme. Ad valorem rate means that the impact of an increase in price of the fuel because of global rate hike translates into an even higher price for airlines as the tax incidence also rises.
(Source: PTI)
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