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Mission Hindutva over to override sangh pariwar challenge, now it is final dash for reform brigade!
Indian Holocaust My Father`s Life and Time, Chapter:Nine Hundred Fifty Nine
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Mission Hindutva over to override sangh pariwar challenge, now it is final dash for reform brigade!The hanging of Guru after kasab is expected to insulate the govt, which has been under bitter attack from Opposition over “limp-wristed” approach to terrorism.It is time for budget to woo the mango people and a final push fo second generation of reforms!Even as the state government ordered a probe into Sunday's stampede at Allahabad railway station, sources said pressure on Kumbh officials to clear the town of the millions led to the 36 deaths and injuries to over 24 others.
How important was this? Just forget someone like Nandita Huxar or Ms Arundhati Roy. Rest of the nation is celebrating. What if the flagbearers of Indian democracy in Kshamir like chief minister Omar Abdulla or the opposition leader Mehbooba Mufti say something different!The nation is habirtual with most violent violation of civil and human rights. Citizens have handed over their privacy and sovereignty for the best tool of ethnic clensing, the digital and biometric citizenship. We have been bearing the armed forces special power act since 1958. We have never demanded justice for Bhopal gas tragedy victims, the aborigin humanscape siezed within in the killing fields, Gujarat genocide or Sikh Killings or Marichjhanpi.We are tamed so much so that we celebrate our killing during Durga Puja all on name of Hindutva. We have never dared to stand with Irom Sharmila or soni Sori. We do join civil society movement now and then, but never did raise our voice against corporate hegemony rule. We have seen curfew so much so that it means nothing how Kashmir reacts.
Budget 2013 is around the corner and in the days before the big day, members of India Inc, multi-national companies and even individual taxpayers are striking an optimistic note.
A survey by BMR Advisors and CNBC-TV18 reveals that the optimism centers around hope of further clarity and stability in tax regime, and the implementation of overdue reforms , reports CNBC-TV18’s Sandeep Srikanth.
As finance minister P Chidambaram begins putting the finishing touches to Budget 2013, he has a daunting task ahead of him. He has to balance the need to revive growth with the pressure to implement ambitious tax policies and the mandate to ensure fiscal consolidation.
BMR Advisors and CNBC-TV18 asked a cross-section of tax and financial experts from India Inc, multi national companies and even individual tax payers for their expectations and here's how the chips fell:
On the tax front, 40 percent of the respondents expect a marginal increase in tax rate given the looming fiscal deficit, but the majority, 47 percent say no and 60 percent do not expect an increase in the surcharge and/or education cess.
But nearly half the respondents expect a separate slab rate to be introduced for high net worth individuals or the super rich though over half of them do not expect the minister to introduce an inheritance tax.
Over 40 percent hope the government will follow the Shome Committee's recommendation on the prospective application of indirect transfer provisions and nearly 50 percent see the minister laying down safe harbor rules for curbing transfer pricing litigations.
Nearly 50 percent of the respondents say they do not foresee any new specific-anti-avoidance-rules in view of the deferment of GAAR.
Over 40 percent believe the Budget will lay down a clear road map for the introduction of the direct taxes code (DTC) and nearly 50 percent foresee a major announcement on goods and services tax (GST). On indirect taxes, 60 percent say the finance minister will hike the median rates for excise duty and service tax. A hike in indirect taxes could hit the government's efforts to kick-start the economy once again.
But India Inc is hopeful of other sweeteners, nearly 50 percent of the respondents expect significant incentives for the infrastructure sector. Also, when it comes to reviving the reforms process, the respondents are split down the middle on whether the government will table the Insurance Bill in the Budget session of parliament.
Saluting the Indian law over Parliament attack convict Afzal Guru hanging, superstar Amitabh Bachchan today said the law should be followed and respected by one and all.He is the real iconic patriot, no doubt.
"We all should follow the law. Whatever India has done, has been done within the ambit of the law," Bachchan told reporters here.
"Whoever is guilty, even if it is me...we all should abide by the law of the country," he said.
"The country has fully investigated this (case). We salute the law of the land," Bachchan said.
Afzal Guru, who was convicted for his role in the attack on Parliament in 2001, was hanged today.
Bachchan was talking to reporters on the sidelines of a function here.
Mind you, the exercise is getting momentum as with a Parliamentary panel suggesting further pruning of the Food Bill, the Centre has called a meeting of state food ministers on Wednesday for detailed consultations once again before taking the revised version to the Cabinet.
The BJP on Monday took strong exception to remarks by Jammu and Kashmir chief minister Omar Abdullah over the hanging of Afzal Guru, alleging that he was speaking the language of separatists and trying to provoke the people of the Valley.
BJP spokesman Prakash Javadekar said Abdullah's comments in the aftermath of the execution of the Parliament attack convict seek to sympathise with terrorists. "In his venomous interviews to the media, Omar Abdullah has ended up sympathising with Afzal Guru. He describes him as a 'young man of 43', forgetting that six of the nine who were killed in the Parliament attack were younger than Afzal," he said.
Javadekar said Abdullah's remarks of "sense of alienation in the Valley" after the hanging of Guru was an insult to common Muslims. "It is equal to bracketing common Muslims with terrorists and anti-national elements," he said.
The BJP spokesman also termed as "most objectionable" the J&K chief minister's statement that "the new generation in Kashmir will identify with Afzal Guru". "The BJP strongly condemns the Chief Minister's statements. He is speaking the language of separatists," Javadekar said, adding that Kashmiri youth identify themselves with cricketer Pervez Rasool and IAS topper Shah Faizal.
Javadekar said Congress should clear its stand on the interviews given by Abdullah as the National Conference was "part and parcel" of the UPA. "So, to raise the issue of discrimination or some other references, is actually nothing but provoking the situation in the Valley. At least the chief minister of Jammu and Kashmir should not do this," he said.
Javadekar said such statements from a chief minister were "totally unacceptable" when the country was feeling "national sense of relief" after the execution of Guru. BJP also took exception to Abdullah's "misrepresentation" of the Supreme Court verdict in the Parliament attack case claiming that it "depended on circumstantial evidence" and death sentence was awarded to "satisfy the collective conscience of the society".
"Abdullah forgets conveniently that the Supreme Court had said there was not even a shred of doubt about Afzal's complicity in hatching the conspiracy to attack Parliament and evidence showed that he had actively participated in its execution," he said.
Javadekar said the Supreme Court had concluded that "short of participating in the actual attack, he did everything to set in motion the diabolic mission."
On Sunday, Abdullah had slammed the execution of Parliament attack convict Afzal Guru and said it would reinforce a sense of alienation and injustice among generation of youth in the Valley. The chief minister had said it was a "tragedy" that Guru was not allowed to meet his family before he was hanged and not allowed a 'final farewell'.
After Jammu and Kashmir chief minister Omar Abdullah questioned the wisdom of executing parliament attack convict Afzal Guru, the main opposition People's Democratic Party in the state called India a "banana republic".
Former chief minister and PDP patron Mufti Mohammad Sayeed, who is locked in competitive politics with the National Conference and chief minister Omar Abdullah, on Monday evening issued a statement, accusing the Centre of a "narrow-minded approach (that) has caused serious setbacks to the peace process".
His statement reflected complete support for Afzal Guru, matching the sentiments that chief minister Omar Abdullah expressed on Sunday, a day after the execution, in interviews to TV channels.
Mufti said: "It is no good to regret the inability of the government to deny Afzal's family a last mandatory meeting with him or deny his body to the family."
In fact, Mufti Mohammad Sayeed said: "This reduces Mahatama Gandhi's country, the world's largest democracy and a genuine candidate for super power status, to a banana republic."
Mufti was home minister of the country in the shortlived VP Singh government from 1989-1990. Mufti urged the central government to "roll back the draconian measures in Kashmir,which have caused a whole population to be imprisoned".
He blamed Delhi for what has been happening in the Valley, claiming that law and order is a state subject and measures like curfew have been taken by Omar Abdullah.
Yet another youth shot in firing by security forces during protests in the Kashmir Valley against the hanging of Parliament attack convict Afzal Guru died early on Monday, taking the toll to three since clashes broke out last Saturday.The Jammu and Kashmir government announced a magisterial inquiry into the incidents that have led to three youths dying during the protests, even as the Valley remained under curfew for the third day on Monday.
"Concerned deputy commissioners and SSPs (of Ganderbal and Baramulla districts) were directed to lodge FIRs and conduct magisterial enquiry into the death cases immediately," an official spokesman quoting divisional commissioner Kashmir Asgar Samoon said.
The situation on Monday was peaceful so far with no reports of any untoward incident from anywhere in the Valley, official sources said. Ubaid Mushtaq, who was injured allegedly in firing by security forces at Watergam village in Baramulla district yesterday, succumbed to injuries at 3 AM, Medical Superintendent of SKIMS Hospital Aijaz Mustafa said.
Two youths drowned in a river in Ganderbal yesterday when they tried to escape security personnel while being chased during a demonstration by protesters. The body of one of the youths—Zameer Ahmad Dar—was fished out from Jhelum river in Ganderbal district this morning, official sources said. The other youth who drowned was identified as Tariq Ahmad Bhat.
An irrate mob thrashed Executive Magistrate Ganderbal Ghulam Mohammad Khatana and his personal security guard Fayaz Ahmad as body of Dar was being taken to Sub-District Hospital for post-mortem, official sources said.
Sources added Khatana and his guard had to be rescued by police by firing tear smoke shells at the protesters. The two were admitted to a hospital for treatment. Restrictions on the movement of people in the Valley were also further tightened in view of apprehension of widespread protests to commemorate the 29th death anniversary of JKLF founder Mohammad Maqbool Bhat.
Bhat, who was sentenced to death for murder of a police officer, was hanged inside Tihar Jail on this day in 1984. As many as 14 companies of BSF were rushed to Kashmir Valley from Jammu to beef up the security apparatus. Ten additional companies of Central Reserve Police Force (CRPF) are also due to arrive in Jammu from Delhi and are being rushed to Kashmir Valley.
An official spokesman said divisional commissioner Kashmir, Asgar Samoon visited the injured persons at a hospital here and sanctioned Rs1 lakh ex-gratia in favour of the three persons who died during the protests. "The Kashmir divisional commissioner Asgar Samoon announced Rs1 lakh in favour of next of kin of two persons of Ganderbal, who died due to drowning and the youth who died in Watergam village," the spokesman said.
Samoon said he has kept three Red Cross ambulances for any emergencies for public, in addition to the ambulances of government departments.
Meanwhile, mobile Internet services remained down for the third day as a precautionary measure. Newspapers also failed to hit stands this morning due to curfew.
The Food Bill, which was introduced in the Lok Sabha in December 2011, aims to give legal right over subsidised foodgrains to two-third of the country's population.
In its latest report, the Parliamentary panel has suggested drastic changes in the Bill, saying that all the beneficiaries be provided 5 kg of wheat and rice per month at a uniform rate of Rs 2 and Rs 3 per kg.
"It (Conference) will discuss proposals made in the Bill and further action for finalisation of the Bill in the light of recommendations of the Parliamentary Standing Committee," an official release said.
At present, below poverty line (BPL) families effectively get 7 kg of wheat and rice at Rs 4.15 and Rs 5.65 per kg per month.
In the Food Security Bill, the government had proposed to change this by giving 7 kg of wheat and rice to a person at Rs 2 and Rs 3 per kg. Non-BPL families, as per the Bill, were to get 3 kg of foodgrain at half of the government fixed minimum support price, which translates into about Rs 7/kg for wheat and Rs 10/kg for rice.
The Parliamentary panel's recommendations are generally not binding on the government. However, if accepted, the recommendations will benefit the general population in both price and quantity, while BPL member will get lesser quota than what was proposed in the original bill.
However,the country is expected to export foodgrain worth around $ 40 billion in 2012-13 on account of surplus production, Minister of State for Agriculture Tariq Anwar said today in Patna.
The country has shipped foodgrains worth $ 20-25 billion so far. The export is expected to touch $ 40 billion by the end of 2012-13 fiscal, Anwar told PTI.
Foodgrains production in the country is expected to scale up to 250 million tonnes (MT) in 2012-13. Out of this, 240 MT foodgrain production has already been achieved.
The Minister said there was tremendous scope for improvement of agriculture in the eastern states. Keeping this in mind, the Union government has launched a special scheme to achieve second green revolution in Bihar, West Bengal, Odisha and Assam.
Bihar Chief Minister Nitish Kumar had a meeting with Agriculture Minister Sharad Pawar recently during which he gave details of a five-year agriculture roadmap formulated by the state government. Pawar, he had said, assured all help to the Bihar CM for the success of the roadmap for 2012-17.
Meanwhile,concerned over delay in the passage of the new Seed Bill, Agriculture Minister Sharad Pawar today said his department has requested Parliamentary Affairs Ministry to ensure that it is taken up for discussion in the forthcoming Budget Session.
The National seed bill, which was introduced in Rajya Sabha in December 2004, aims to regulate the quality of hybrid seeds and check the sale of spurious seeds, besides increasing private participation in seeds production and distribution.
"One of the important bills is pending for quite some time now. We have taken up with the Parliamentary affairs Ministry that new seed bill should be discussed in the Budget Session. If Parliament accords, a lot of issues will be resolved and will be helpful for the entire seed sector," Pawar said at a conference organised by National Seed Association.
"I hope that the bill will come up for discussion in the Budget session of Parliament," he added.
The Bill proposes to repeal and replace existing Seeds Act, 1966, for it does not deal with the quality control of genetically modified (GM) seeds. The legislation also envisages hiking penalties in case of those found selling non-certified seeds.
Stressing upon the importance of seed sector to achieve 4 per cent farm growth, Pawar said: "Though we achieved self- sufficiency in cereal production, we continue to depend on imports of pulses and edible oils."
Private participation in these crops is low. "While there are technological barriers in developing hybrids in pulses, success met with some of the oilseeds crops need to be pursued with vigour. This will help reduce the import bill," Pawar said.
Pawar also mentioned, "My colleagues in the Finance Ministry are worried about higher import of pulses and edible oil. We have to increase domestic production of these two commodities for which the support of technological breakthrough in seeds and other inputs is required."
The government is open to supporting a policy to promote development of new seeds in pulses and oilseeds, he added.
Stressing the need to sell quality seeds at affordable price to farmers, the minister said: "The public and private sectors have to partner the process of change equally by brining in better products, supplement the technology transfer efforts of the government and ensure that we never have to go back to the era of food shortages."
In the last 3-4 years, the government has taken several steps to encourage private industry participation in seed sector. The New Policy on Seed Development (NPSD) was revised to allow import of oilseeds and coarse cereals by using protocol procedure for trails, he noted.
Reserve Bank today said it will take into account decelerating growth and Finance Ministry's fiscal consolidation efforts in the forthcoming budget before formulating its monetary policy review next month.
"We have taken note of roadmap for fiscal consolidation put out by the Finance Minister. And like everyone else in the country and around the world, we are also looking forward to the Budget to have a better understanding of how fiscal consolidation could be done on the way forward," RBI Governor D Subbarao told reporters after the board meeting here.
Commenting on latest growth estimate of 5 per cent for the current fiscal, he said, "We got to know about the CSO projection. We will take that into account as and when we make our next policy."
The Central Statistical Organisation (CSO) has pegged the economy growth rate for the current fiscal at 5 per cent, the lowest in the decade. The economy grew by 6.2 per cent in 2011-12.
On the possibility of rate cut to boost growth, Subbarao said, "I am unable to comment on rate cuts at this forum."
Reserve Bank is scheduled to announce mid-quarterly review of monetary policy on March 19.
With a view to promoting growth, RBI in its quarterly policy review last month lowered the key pending rate by 0.25 per cent and reduced the Cash Reserve Ratio (CRR) by the same margin releasing Rs 18,000 crore or primary liquidity into the system.
Replying questions on inflation, RBI Governor said, "we have given our assessment (in policy document on January 29). There is nothing further to add to what we said a week ago but going forward we will be taking into account further developments and further data that comes."
Indian Markets are expected to slip post the Union Budget 2013 on February 28, according to global investment bank Morgan Stanley.
Historically, in the past 20 years, the MSCI India has outperformed the MSCI EM on eight occasions (1997, 1999, 2001, 2004, 2005, 2006, 2010 & 2011) in the month after the Budget.
On average, India markets have fallen 2.3 per cent in the month after the Budget with the first 15 days accounting for most of it, underperforming emerging markets by 1.5 per cent.
According to Morgan Stanley's observation, if the market is up in the month before the Budget, it has an 80 per cent prospect of falling post the event, higher than the overall probability of 60 per cent.
"A market that is already down before the Budget still holds an even chance of slipping further in the month after," said the report.
Historically, March has been the worst month of the calendar year, partly because of the Budget itself. The market still seems skeptical ahead of the key event.
After registering a return of 26 per cent in the year 2012, Indian markets corrected significantly so far in the year 2013 from its highs. For the month of January, the BSE Sensex rose 1.96 per cent.
While for the month of February, Indian markets have erased most of their gains registered in January and were down over 2 per cent.
Morgan Stanley advises investors to stay long in equities because the path of fiscal consolidation will likely prove positive for share prices going forward.
Ahead of the January inflation readings later this week, Reserve Bank Governor D Subbarao today said the price rise index which slowed to a three-year low of 7.18 per cent in December, is "still high."
"If you take the macroeconomic context today, you find that growth has moderated, inflation has come off the peak, but even at 7 plus per cent, it is still high," he said while addressing the convocation of the RBI-promoted Indira Gandhi Institute of Development Research here.
The forthcoming inflation numbers are important as they come after the January 29 policy easing, when the RBI cut both the interest rates as well as the cash reserve requirements of banks by 25 bps.
The also come after the government partially freed diesel prices in the middle of January by allowing oil companies to raise retail diesel by 40-50 paise every month apart from taking away the subsidy on bulk diesel customers.
While retail or consumer-price based inflation readings jumped to over 10 per cent in December, headline inflation declined to a three-year low to 7.18 per cent during the month.
The January inflation numbers are also crucial because they will be considered before the mid-quarter review by RBI on March 19.
Taking a dig at those who blame his tight monetary stance as a major reason for the steep decline in growth, the Governor said: "The RBI has been criticised for hurting growth and we are sensitive to that. But one should understand that the person blaming for growth is very articulate and has got proper platforms for speaking up."
"However, the person pinched by inflation does not have a platform and I think both the RBI and the government should take care of that part of the population," said Subbarao, who fought a solitary battle of nearly 40 months to fight inflation even as his counterparts across the globe have re-embraced an easy monetary policy regime as growth in their home countries faltered again.
On the still sticky inflation, Subbarao said: "Though it has declined from peak, it still is above our comfort level" and pointed out that "structural and cyclical factors are driving the inflation".
"Crude oil and food inflation are driving inflation up. There is inflation from the high fiscal deficit as well apart from those coming in from demand pressures. How do we balance between declining growth and stubborn inflation? How do we calibrate the balance? That's a constant struggle in the Reserve Bank," the Governor said.
He said along with a deceleration in economic growth, investment has not only decelerated but also declined.
"Also, the external sector is very vulnerable and that is the macroeconomic context in which we formulate our monetary policy," he said.
Nalco to hit market after budget; to raise Rs 1,400 crore
Nalco disinvestment, which could fetch Rs 1,400 crore to exchequer, is likely to hit the market during the first week of March, after the budget, to ensure it is not impacted by volatility in stock markets.
The Department of Disinvestment (DoD) would start roadshows in Singapore, Hong Kong, Japan, US and UK on February 19 for disinvestment of the state-run aluminium company. The roadshows would conclude on February 25, sources said.
"Nalco disinvestment will happen only after the budget. There is lot of volatility in the markets before the budget and hence we have decided to schedule it in the beginning of March," sources said. The budget is to be presented in Lok Sabha on February 28.
The 12.5 per cent stake or 31.31 crore share sale of Nalco is expected to fetch around Rs 1,400 crore to the exchequer at the current market price. Shares of Nalco closed at Rs 47, up 0.75 per cent on the BSE.
Government currently holds 87.15 per cent stake in Nalco. The government had in November last year deferred disinvestment of Nalco citing poor second-quarter performance which raised valuation concerns and said the stake sale would happen only after the third quarter results.
The aluminium major reported a more than two-fold jump in its October-December quarter net profit to Rs 118.94 crore, on the back of improved sales. The National Aluminium Company (NALCO) had a profit of Rs 51.22 crore in the same period last fiscal.
"We expect to get good valuation of Nalco. Last time the merchant bankers advised to defer the offer to March quarter. This time we want to do it only when the market is stable," sources said.
Enam Securities, SBIBSE 0.36 % Caps and IDFCBSE -2.26 % are merchant bankers for the Nalco disinvestment.
The Cabinet Committee on Economic Affairs (CCEA) had in September approved disinvestment in the Navratna PSU.
Following the stake sale, the government's holding will come down to 75 per cent in the company.
The stake sale would happen through the Offer for Sale (OFS) or auction route. The paid-up capital of the Company as on March, 2012 stood at Rs 1,288.62 crore.
on, Feb 11, 2013 at 21:12
Budget 2013-14: Expect GST to be rolled out at the earliest: Jyothi Lab
The country has been reeling under unsympathetic market conditions. The previous budget was a disappointment. The investment in select sectors was as expected and nothing extraordinary.
The country has been reeling under unsympathetic market conditions. The previous budget was a disappointment. The investment in select sectors was as expected and nothing extraordinary. Given the current economic scenario, we would like to see the Union Budget to come out with strong measures & economy boosters from the Union Budget to restore confidence and spur growth. In this budget we expect GST to be rolled out at the earliest possible. The implementation of nationwide GST will help in simplifying the entire tax structure. It would be a win-win situation for both customers & retailers as GST will help in cutting business costs and generate more revenue. If the GST is delayed, there should be a provision for a uniform VAT to be implemented across the country.
Why India Inc wants GST so badly: FAQ
In the last budget, the then Finance Minister Mr Pranab Mukherjee has increased the excise duty to 12% from 10% resulting in increase in the prices of most of the FMCG products. This was accompanied by an increase in service tax by 200 basis points to 12%. Both these measures had led to lower disposable income in the hands of consumers. Currently Indian economy is going through a tough phase and one of the ways to move the economy out of this situation will be to increase consumption along with spur investment. We suggest that reduction in the excise duty and restoring it back to the last year level of 10% will not only increase consumption especially in the rural India, but will also be a psychological booster in the minds of consumers.
The government has started on a very positive note with a pilot project in 20 districts in 16 states for direct cash transfer of subsidies. The idea of cash transfer can be a game changer for India if it is implemented well. The Finance Minister in the coming budget should announce of direct cash transfer of subsidy at large scale. This will not only stop the leakage will increase consumption thereby help in the economic growth. There is an urgent need to create employment and empower the backward areas of our country that are lagging far behind the cities. The Finance Minister should make a special provision in the budget for employment generation beyond what has already been done so far by various schemes.
One of the main factors for slowdown in the economy is the high interest rates. Lot of companies have been facing the pressure of this and due to this the investment cycle has slowed down. Now the inflation has also moderated even though it is still on the higher side. Some of the steps like reduction in excise duty on important products and implementation of GST would further lower inflation and making a strong case for interest rate reduction. We are hoping that if all things goes as expected there is room for the interest rate reduction by at least 200bps that would help companies reduce their interest burden significantly along with boosting liquidity in the economy.
Budget 2013: Pragmatic or reformist?
A BMR Advisors-Mint survey of tax and finance heads finds that they want clarity and stability in the tax regime
The fate of the two most ambitious tax reforms—the direct taxes code (DTC) and the goods and services tax (GST)—continues to hang in the balance despite four years of effort since the government first took a stab at key fiscal reforms. Photo: HT
Updated: Mon, Feb 11 2013. 09 28 PM IST
Ahead of the budget presentation on 28 February, all eyes are on finance minister P. Chidambaram, who has a track record of implementing ambitious tax policies while staying deeply committed to reforms and achieving fiscal consolidation without neglecting the government’s ambitious social programme outlays.
Our pre-budget survey focused on gauging the mood of tax and finance heads of leading Indian business houses and multinationals and individual taxpayers. A consistent theme emerging from the survey was the need for clarity, certainty and stability in the tax regime besides reforms and incentives for housing and infrastructure.
Thrust on reforms driven by an eye on tax collections
Nearly half the respondents expect the government to maintain its reforms thrust, including tabling the insurance Bill to loosen over-regulation in the sector. A majority is also hopeful that the government would prioritize infrastructure development by granting tax sops for development of low-cost affordable housing, and extending a tax holiday for power generation.
Findings of the National Institute of Public Finance and Policy on unaccounted wealth could well feature in directional policy announcements. Alongside strengthening the country’s tax information exchange framework and renegotiating tax treaties, expect announcements on administrative measures.
However, a majority of the respondents are sceptical of the government walking the talk on administering laws to deal with the menace.
Imposition of a higher tax on the super rich and introduction of an inheritance tax was debated intensively, including its rationale and ramifications. The majority expects the government to introduce a higher slab for high net-worth individuals but doesn’t foresee the introduction of an inheritance tax.
Businesses look forward to a stable tax regime; a majority of the respondents does not foresee an increase in either the rate of tax or surcharge and cess. An overwhelming majority expects the budget to articulate tax deduction provisions governing contributions towards corporate social responsibility initiatives.
Ghost of GAAR and retrospective provisions
Recent statements hinting at the acceptance of recommendations by the expert panel headed by Parthasarathi Shome on deferment of general anti-avoidance rules (GAAR) are likely to be followed up, boosting investor confidence. However, the question that concerns most is if the deferral of GAAR is adequate given the recent spate of high-pitched assessments and overdrive for tax collection. It remains to be seen if the budget yields to the panel’s recommendation on retrospective applicability of indirect transfer provisions as the Vodafone case continues to grab global headlines. Only four out of 10 respondents are hopeful of a respite by way of prospective applicability of indirect transfer provisions, though some feel that the finance minister may spring a surprise by bringing enabling provisions for settling the controversy on terms that are mutually acceptable.
Transfer pricing—Achilles’ heel
Transfer pricing continues to be a key challenge for businesses, given the quantum of transfer-pricing adjustments and consequential tax effect taking its toll on multinationals and clogging tribunals and courts with disputes which can otherwise be amicably resolved by resorting to economic principles and alternative dispute resolution processes under tax treaties. As India’s advance pricing agreement (APA) mechanism takes off, it is becoming imperative for the finance ministry to lay down clear directives and guidelines for determining an acceptable range of arm’s length price in complex business scenarios. US investors are sceptical of India’s APA programme and are expecting greater clarity and certainty on settlement of transfer-pricing disputes under the treaty. Respondents are cautiously hopeful that an announcement of safe-harbour rules and acceptance of the N. Rangachary committee recommendations will feature; nearly half the respondents expect a definitive announcement on implementation of the rules.
DTC and GST—distant dreams?
The fate of the two most ambitious tax reforms—the direct taxes code (DTC) and the goods and services tax (GST)—continues to hang in the balance despite four years of effort since the government first took a stab at key fiscal reforms. The finance minister has reaffirmed his commitment to implementing DTC and GST and his confidence is echoed by a majority of the respondents expecting budget 2013 to lend greater clarity on a road map for implementation of both measures. Half the respondents seem to believe that a complete roll-out of GST and DTC is a long road ahead, looking at polls in 2014. My view is that the finance minister can well bring an amended DTC Bill in the monsoon session and expedite the DTC roll-out from April 2014.
Expect greater clarity on applicability of indirect taxes
Almost 49% of the respondents are expecting amendments in service tax law to remove ambiguities. Considering the nascent nature of the law, respondents are expecting amendments to lend clarity. Similarly, 40% of respondents expect the government to liberalize CENVAT (central value-added tax) credit scheme and make all inputs, capital goods and input services creditable given that on the output side almost all services are now liable to service tax.
Mukesh Butani is chairman of BMR Advisors, a consultancy.
10 FEB, 2013, 10.45AM IST,
Budget 2013: Why Chidambaram should play Angry Birds
y Alok Kejriwal
Can he take inspiration from it and also make his budget single-pointed and easy? The Budget should be like the popular game —simple, elegant & comprehensible to all.
I really have some major expectations from P Chidambaram this budget. The expectations are accentuated since his predecessor Pranab Mukherjeedid nothing during his term as finance minister. He did so little that if Kumbhakarna, the demon who slept, had to appoint a successor, Mukherjee would have made an ideal choice.
Now, back to Angry Birds and why Chidambaram should play it ASAP (I mean, immediately after reading this article).
Nani, Munna & Bahu Can Play The greatness of Angry Birds is that anyone and everyone can play it. My 85-year old Nani plays it and even enjoys it more than Noughts and Crosses. Why so? Because Angry Birds is as simple as switching on the TV. Or, to put it in the Indian context, it is as simple as honking the car-horn.
What Chidambaram will realise in the first 40 seconds of play is the elegance of simplicity. And that is how his 2013 Budget should be. Simple, elegant, easy to understand and comprehensible to all.
All the past budgets, including Chidambaram's, have sounded like monotonous mantras that pundits recite during weddings and housewarmings. Everyone just wants the chanting to end so that they can run away — or attack the food. Only someone of Chidambaram's stature can make complexity simple, so that citizens understand the gravity, heft and importance of the most important document of the Government of India. Only when people understand things can they appreciate them.
One Rule for All Players In Angry Birds, you fling birds at pigs to destroy them — that's it. I just described the core game mechanic of the world's most popular game in a single sentence. Now, can Chidambaram take inspiration from the same and also make his budget single-pointed and easy? Here are two instances that Chidambaram could consider.
As a mobile games entrepreneur funded by international venture capital, I struggle to make a dent in the global market. While I keep myself awake at night, figuring out games, the last thing that contributes to my insomnia should be Indian tax and accounting rules. But trust me, the rules, regulations, dos and, more importantly, don'ts are so frightening that I have to keep working with my CFO and an army of consultants to keep out of harm's way. Just to remit salary to my international employees requires me to sign at 17 places each month.
Also, consider the long-drawn-out Vodafone tax case. Neither the government nor the tax department, nor Vodafone, really seems to be clear about the rules and regulations that apply to this case. When I read "The government is open to a settlement", I read between the lines that "We changed the rules and you got trapped, so let us help you out a bit".
Chidambaram, please make the finance rules of our country so simple that Amitabh Bachchan can ask a few questions on them in the next round of Kaun Banega Crorepati, with simple multiple answers. That should be your real test.
Killing Many Pigs With One Bird In Angry Birds, you can score maximum points if you destroy all the enemy pigs with one bird. It is funny how killing many birds with one stone has been turned around.
10 FEB, 2013, 07.40AM IST, NISTULA HEBBAR,ET BUREAU
Budget 2013: Will UPA government succeed in balancing economy & politics?
With elections coming, the govt readies to push through a clutch of vital bills in the Budget session after a prolonged phase of inertia. Will the allies and the opposition play ball?
Some would say that the main suspense of the Budget session of Parliament is already over. The railway ministry announced its first hike in passenger fares in 12 years in January, while the finance ministry has floated a weather balloon canvassing opinion on whether taxing the rich more would help bridge the fiscal deficit.
A widening fiscal deficit, slower growth than previous years (the government has projected GDP growth for fiscal year 2013 at 5%) and not enough headroom to spend (even on defence, which is going to face spending cuts this year) mean that the finance minister, P Chidambaram, has less space than before for any financial pyrotechnics. This is a particularly problematic situation when presenting the last full budget before a general election.
The session, therefore, will be packed with heavy-duty bills, contentious and political, increasingly looking like a wish list that should have been done and dusted over the past two years but which now appears as governance in hindsight.
Finance Bill, Yes, But More Politics Please
Most of the bills have been hanging fire for the past few years. For example, the Land Acquisition (Amendment) Bill, a legacy from UPA I, it could not be passed because of coalition drama (first the Left parties and later theTrinamool Congress were allies and had definite views on the bill). Other bills, especially the ordinance to strengthen anti-rape laws, are a direct reaction to pressure from the streets. Mostly though, a senior Cabinet minister says, the government had "allowed itself to drift for the better part of the past two years, and has to get its act together fast".
"Since the election of Pranab Mukherjee as president, the PM and the FM appear to be on the same page on the economy. The setting up of the Cabinet Committee on Infrastructure will, in the next few months, ease some of the inter-departmental gaffes in this sector," said a senior government official. Manmohan Singh and Chidambaram are more "synergistic" than Mukherjee and Singh were, adds another official in the know.
It is the battle for perception and politics that is, however, forcing the agenda for this session. After being accused of inactivity and apathy during the worst of anti-graft agitation and the Delhi gang-rape protests, the government has woken up to feverish activity, spurred on by the fact that the general elections are just a year away.
"During the Budget session, the priority is always the financial business, of course, but the ordinance on strengthening anti-rape laws, the Land Acquisition (Amendment) Bill, and the Lokpal Bill will be tabled and hopefully passed in this session," the minister of state for parliamentary affairs, Rajiv Shukla, told ET Magazine.
"I refuse to call it governance by hindsight. The [anti-rape] ordinance is a quick response to the events in December, and the land bill and the Lokpal have to go through due parliamentary processes," he adds.