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Bracing to roll out the new indirect tax regime — Goods and Services Tax (GST) from April 1 next year, the government on Wednesday set up two committees to suggest tax rates and look into I-T preparedness.
The committee would “recommend possible tax rates under GST that would be consistent with the present level of revenue collection of Centre and states,” an official statement said.
“While making recommendations, committee would consider expected levels of growth of economy, different levels of compliance and broadening of tax base under GST. ..,” the statement added.
Govt proposes tax sops to boost e-transactions
By: ENS Economic Bureau
To discourage transactions in cash and thereby curb black money, the government is considering giving incentives to electronic transactions in the form of tax rebates, waiver of charges on card payments such as purchase of rail tickets and discounts on utility bill payments.
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The finance ministry on Wednesday put up the draft proposals for facilitating electronic transactions and asked the public to comment on the same by June 29.
In his Budget speech in February, finance minister Arun Jaitley had proposed to introduce measures that would incentivise credit or debit card transactions and disincentivise cash transactions.
To promote wider adoption of e-transactions, the government has proposed income tax rebates to end consumers for paying a certain proportion of their expenditure through electronic means.
The amount of rebate hasn’t been mentioned. Merchants could get tax rebate if at least , say 50 per cent, value of the transactions is through electronic means or alternatively, a 1-2 per cent reduction in value added tax could be given for all electronic transactions by the merchants, according to the draft.
It also suggests to increase the threshold to Rs 5 lakh from Rs 2 lakh in a year for reporting of aggregate credit card transactions to tax authorities.
The move proposes policy intervention to waive convenience fee/service charge/surcharge levied by government entities on card payments. FE
