The Indian Express (Delhi Edition)
‘GST won’t lead to job losses, enough work to be available’
FM ASSURES TAX OFFICIALS
shares / instruments issued prior to April 1, 2017. This would improve the sentiment and a similar clarification should also be issued in the context of the Tax Treaties with Mauritius, Singapore and Cyprus,” Abhishek Goenka, Partner, Tax & Regulatory Services, PWC said.
GAAR can be invoked through a two-stage process involving a nod at the level of principal commissioner of income tax and a panel headed by a high court judge. “The stakeholders have been assured that adequate procedural safeguards are in place to ensure that GAAR is invoked in a uniform, fair and rational manner,” CBDT said, adding that the government is committed to providing certainty and clarity in tax rules.
CBDT said that if at the time of sanctioning an arrangement the court has explicitly and adequately considered the tax implications, GAAR will not apply to such an arrangement. It would also not apply if an arrangement is held as permissible by the Authority for Advance Rulings.
“Further, it has been clarified that if an arrangement has been held to be permissible in one year by the Pcit/cit/approving Panel and the facts and circumstances remain the same, GAAR will not be invoked for that arrangement in a subsequent year,” CBDT said. It also clarified that levy of penalty under GAAR would depend on “facts and circumstances of the case and is not automatic”.
Finance minister Arun Jaitley had in his Budget speech in 2015, deferred GAAR implementation by two years and also said that the investments made up to March 31, 2017 shall not be subjected to GAAR, which was to be applied on those claiming tax benefit of over Rs 3 crore. CBDT Friday clarified that Rs 3 crore limit of tax benefit calculation for each arrangement cannot be read with a single taxpayer as GAAR is with respect to an entire arrangement that has been entered into. AFTER THE Customs and Central Excise officials raised concerns of job loss after rollout of Goods and Services Tax (GST), finance minister Arun Jaitley on Friday assured that they should have no insecurity as enough work and opportunities will be available to them and only the nature of work will change in the new indirect tax regime.
“I see no reason really for disquiet for the simple reason (that) opportunities which are available to people in service and the matter of policy and constitutional guarantee are all protected,” Jaitley said at the Investiture Ceremony organised by Central Board of Excise and Customs (CBEC).
The proposed GST will subsume all indirect taxes, replacing an array of central and state levies like excise duty, service tax and VAT.
“Important changes and evolutions which take place are never put on the back burner for the reason that they are the responsibility of those who conduct the activity itself will now be in an altered form, altered environment,” he said.
He further said: “Once it takes place you have a situation where taxes (that) are levied by the state (and) by Centre (will) all be integrated into one and therefore resulting in one assessment. Multiple systems on assessment which is there at present will evolve into a newer kind of system,” he said.
Jaitley responded to concerns of indirect tax officials after CBEC chairman Najib Shah pointed to the “rising disquiet in the cadre”. Shah said there were human resource issues in the service.
Jaitley also said the revenue to be collected is going to expand and there will be expansion of economic activity as well. “Therefore even though you have two parallel machineries which could now be converging into similar kind of activities and shared responsibility, I think the future will stand witness to the fact that there will be adequate amount of opportunities to be created and therefore the kind of disquiet in service, the kind of personal pressure I see on you should reduce as there is no real occasion for a fear of this kind or a sense of insecurity for anyone in this service,” he said.
The finance minister said change and evolution are an integral part of any economic order. “This is an ongoing process it will continue and we will all have to adjust ourselves with this particular change. I can only assure you that there is no reason for disquiet, you can go and have a comfortable sleep tonight,” Jaitley said.
Revenue secretary Hasmukh Adhia also told the officers that they will have enough work to do under GST.
The Indian Revenue Service (Customs and Central Excise) Officers’ Association had asked the government to protect the sanctity of their service amid attempts by officers of state government VAT departments to equate themselves with IRS (Customs and Central Excise) officers. They had called for a noncooperation movement by wearing black badges against the recent decisions made by GST Council, which divided the taxpayers in a 90:10 ratio below the annual turnover threshold of Rs 1.5 crore, with 90 per cent of the tax assessees to be scrutinised and audited by the states.
For taxpayers above the Rs 1.5 crore threshold, the taxpayers will be divided equally between the states. The arrangement between the Centre and the states to break the deadlock on division of control is being seen as a compromise on part of the Centre, as it has lost out on the maximum share of taxpayers under the threshold of Rs 1.5 crore.