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Dated:- 16-3-2012 – Press Information Bureau Government of India Ministry of Finance 16-March-2012 13:29 IST Government Keen on Early Enactment of DTC Bill Model Legislation for GST on the Anvil National Information Utility to be Operational by August The Union Finance Minister ShriPranab Mukherjee today expressed firm commitment to enact the Direct Taxes Code (DTC) Bill at the earliest, after expeditious examination of the report of the Parliamentary Standing Committee. The Bill was introduced in Parliament in August 2010, and was to come into force from April 1 this year. However, the timeline could not be adhered to as the report of the Parliamentary Standing Committee on the matter was received only on March 9 this year. Similarly, Shr

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Allied Laws – GST to be operational by August 2012 – TMI Updates – Highlights

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Goods and Service Tax – GST – By: – Swati Dodhi – Dated:- 15-3-2012 Last Replied Date:- 30-12-1899 – Goods and Service Tax (GST) As the introduction of the Goods and Service Tax (GST) gathers momentum, the businesses in India have started bracing themselves. GST, which is likely to subsume most of the current indirect tax levies, is expected to be the most efficient indirect tax system in India. GST would be a single comprehensive indirect tax to be levied on goods and services. It would be levied at every production and distribution leg with the eligibility to claim set-off of most indirect taxes on procurement leg. Under the current regime, there is a fractured credit mechanism; businesses don't get credit for all the taxes they pay.

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n enhanced logistics cost. For instance, to avoid the burden of CST, the businesses open distribution centres in all the States, which lead to additional logistics cost. With the introduction of GST, the businesses may re-define their supply chain and structure the same in a most economic and efficient manner without worrying about the indirect taxes – for example, the businesses may not need to open distribution centres or warehouses in each and every State; they can operate from a place most convenient for their business from a commercial perspective. This would not only allow the businesses to save the inventory and warehousing cost but would also reduce the unwarranted compliance requirements under indirect tax laws in each and every st

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from 10 per cent currently to 16 per cent under GST. Besides the fact that GST is likely to have an impact on the pricing of goods and services, the cash flow of businesses may result in favourable swing. Unlike the current regime, no input tax would become cost under GST and could be set-off against the output tax liability instead of cash payment. REVAMP OF BUSINESSES GST would not just require the businesses to re-define the supply chain but also to re-design their accounting and IT systems. The transformation would require the businesses to revise the formats of invoices, purchase/sales registers, stock registers, reporting declarations to factor the changes under the GST regime. The IT systems would have to be reconfigured accordingly.

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Dated:- 22-2-2012 – Press Information Bureau Government of India Ministry of Finance 22-February-2012 16:39 IST GST will bring about a Paradigm Shift in the Arena of Indirect Taxation in the Country; asks CBEC to make extra efforts to meet the Targets Of Indirect Tax Collections for the Current Fiscal : FM The Union Finance Minister Shri Pranab Mukherjee said that with the introduction of Goods and Services Tax (GST), we are now perhaps at the door-step of the most significant reform in the history of indirect taxes in the country. He said that GST is expected to be a more efficient system of taxation and is likely to give a boost to the tax revenues of the Centre and the States. The Finance Minister Shri Pranab Mukherjee said that GST will also remove barriers amongst States and convert the entire country into a common market. Once implemented, GST will bring about a paradigm shift in the arena of indirect taxation in the country, the Finance Minister added. Shri Mukherjee was speaki

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re than doubled over the last ten years from ₹ 68,282 crore in 2000-01 to ₹ 1,37,427 crore in 2010-11 which is 40 per cent of the total revenue from Indirect Taxes. Shri Mukherjee said that the in the current financial year, the collections from Central Excise up to January, 2012 stand at ₹ 1,17,730 crore, out of total indirect tax collections of ₹ 3,17, 233 crore. He said that there has been exponential growth in the service tax revenues over the years. As compared to a revenue of just ₹ 2612 crore in 2000-01, the service tax collections in 2010-11 stood at ₹ 70,391 crore, which is about 20 per cent of total indirect tax collections, the Finance Minister said. The Finance Minister Shri Mukherjee said that the indirect tax collection figures up to January 2012 indicate that there have been some gains over the last year. However, the Finance Minister said that still further efforts are required to ensure to meet the target of indirect tax collections

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source of inspiration to the other officers of the Service. On the revenue front, he mentioned that while Service tax revenues had been buoyant, there were challenges in so far as Central Excise & Customs revenue were concerned. However, he expressed the hope that the budgetary targets would be achieved by the Department. Quoting the report of the Global Financial Integrity that 70% of the illicit outflow of funds is through trade mispricing, he highlighted the role of the Department in combating various forms of organized economic crimes. He mentioned that there was a good momentum on the GST front, the implementation of which required the concurrence of the States. Speaking about the welfare measures of the staff, Shri Gujral mentioned that the Cadre review of the Department is expected to be through within a period of one month. Chairman CBEC Shri S.K.Goel informed that the indirect tax collections of ₹ 3,17,233 crore till January 2012 in the current financial year, are 15

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nce and dedication to work in their respective fields. I congratulate the officers who are being conferred with the certificates of the Presidential Award 2011. I also greet the family members of the awardees who have assembled here to witness the conferment of this prestigious award. Your presence is undoubtedly a source of motivation to the awardees. The Customs and Excise Department has undergone a major transformation in keeping with the needs of a rapidly changing economic environment in the country. The Department has shown an ability to adapt quickly and successfully to the challenges that it has encountered. In fact, by launching major IT initiatives for facilitating tax compliance, the Department has set an example for others to emulate. The latest such initiative, namely, the introduction of mandatory e-filing of Central Excise and Service tax returns would not only make the process convenient for the assesses and reduce the transaction costs, but would also throw up useful i

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control-based gate pass system to invoice and record-based system. The objective of these reforms was to repose a greater trust on assesses and introduce a number of trade facilitation measures in Central Excise rules and procedures. The system of compliance in central excise was sought to be implemented mainly through audit and anti-evasion machineries. These reforms have to continue to their logical end, making compliance easy and cost effective. Service Tax was introduced for the first time in 1994. It has steadily grown over the years and now covers 119 services. There has been exponential growth in the service tax revenues over the years. As compared to a revenue of 2612 crore in 2000-01, the collections in 2010-11 stood at 70,391 crore, which is about 20 per cent of total indirect tax collections. With the introduction of Goods and Services Tax (GST), we are now perhaps at the door-step of the most significant reform in the history of indirect taxes in the country. Under the GST

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d a large number of trade facilitation measures, the most recent ones being the Authorized Economic Operator Scheme for faster clearances as part of secure global supply chain and Onsite Post Clearance Audit. Self-assessment in tax returns has been introduced last year. It marks a fundamental shift from the departmental assessment and a new era has begun, one of trust based customs control. Customs will continue to play a vital role in combating the menace of fake Indian currency, counterfeit products, narcotic drugs and psychotropic substances, smuggling of which has become a major economic threat. It means that the Customs operational units have to be equipped with the latest technology and resources for dealing with such offences. A powerful intelligence network is equally important in this task. I am happy to see that the department has been proactive in co-operating with other countries for the prevention and detection of customs offences. As we approach the end of the current fin

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FEMA – Export of Goods and Services – Receipt of advance payment for export of goods Involving shipment (manufacture and ship) beyond one year . – Cir. No. 81 Dated: February 21, 2012 – TMI Updates – Highlights

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Export of Goods and Services – Receipt of advance payment for export of goods Involving shipment (manufacture and ship) beyond one year . – FEMA – 81 – Dated:- 21-2-2012 – RBI/2011-12/403 A.P. (DIR Series) Circular No.81 February 21, 2012 To All Category – I Authorised Dealer Banks Madam / Sir, Export of Goods and Services – Receipt of advance payment for export of goods Involving shipment (manufacture and ship) beyond one year Attention of Authorised Dealer Category – I (AD Category I) banks is invited to the sub-regulation (2) of Regulation 16 of the Foreign Exchange Management (Export of Goods and Services) Regulations, 2000, notified vide Notification No.FEMA.23/RB-2000, dated 3rd May 2000, as amended from time to time, in t

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or the overseas buyer. ii. compliance with the Anti Money Laundering standards has been ensured; iii. the AD Category-I bank should ensure that export advance received by the exporter should be utilized to execute export and not for any other purpose i.e., the transaction is a bona-fide transaction; iv. progress payment, if any, should be received directly from the overseas buyer strictly in terms of the contract; v. the rate of interest, if any, payable on the advance payment shall not exceed London Inter-Bank Offered Rate (LIBOR) + 100 basis points; vi. there should be no instance of refund exceeding 10% of the advance payment received in the last three years. vii. the documents covering the shipment should be routed through the same auth

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Service Tax – Head Office distributed credit – The input service distributor can distribute the Service Tax paid on input services amongst its various units only if such services are used among the un

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FEMA – Export of Goods and Services- Simplification and Revision of Softex Procedure. – Cir. No. 80 Dated: February 15, 2012 – TMI Updates – Highlights

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FEMA – 80 – Dated:- 15-2-2012 – RBI/2011/12/400 A.P. (DIR Series) Circular No. 80 February 15, 2012 To All Authorised Dealers in Foreign Exchange Madam / Sir, Export of Goods and Services- Simplification and Revision of Softex Procedure Attention of the Authorised Dealers is invited to Regulation 6 of the Notification No.FEMA 23/2000-RB dated May 3, 2000 viz. Foreign Exchange Management (Export of Goods and Services) Regulations, 2000, as amended by the Notification No.FEMA 36/2001-RB dated February 2, 2001, in terms of which designated officials of the Ministry of Information Technology, Government of India at the Software Technology Parks of India (STPIs) or at Free Trade Zones (FTZs) or Export Processing Zones (EPZs) or Special Economic Zones(SEZs), had been authorised to certify exports declared through SOFTEX Forms. 2. Considering the spurt in the volume of software exports from India in recent times, the complexity of work contracts involved, the voluminous nature of contract ag

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the values etc. and will thereafter forward the first copy of the revised SOFTEX format to the concerned Regional Office of RBI, the duplicate copy alongwith bulk statement in excel format to Authorised Dealers for negotiation / collection / settlement, the third copy to the exporter and the last copy will be retained by STPI for its own record. Under the revised procedure, the exporters, however, will have to provide information about all the invoices including the ones lesser than US$25000, in the bulk statement in excel format. [The revised procedure for submission of the Softex form and other relevant documents are detailed in the Annex.] 4. The new procedure will be effective initially in STPI Bangalore, Hyderabad, Chennai, Pune and Mumbai with effect from April 01, 2012. Based on the success in these centers, it would be adopted by all the STPIs and SEZ/ EPZ/ 100% EOU/ EHTP/ DTA units by June 2012. 5. Authorised Dealers may bring the contents of this circular to the notice of th

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s are exhausted, the exporter can apply again to RBI for allotment of number. Exporters can use the allocated Softex number either for each invoice or for a group of invoices with same currency of a particular customer. Softex number would be the control number for identifying any of the export transaction. E. Details of information – As per the template in Annexure A, which will broadly cover information as under Name and Address of the Exporter Letter of permission number and date Name of authorized data com service provider Import Export Code number Software Export Declaration Details of Export of Software during the period Period of submission i.e. Month name SOFTEX Number Name of Client Address of Client Country of Export Invoice Number Invoice Date Project Code or Contract or Agreement or PO & Date Type of Software Exported Invoice Currency Offshore Invoice value Details of billings on account of Royalty on Software Packages/products exported as per Annexure B Period of

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py Submission – Software Exports Declaration in summary excel sheet with above details. G. Hard copy submission – Covering letter along with summary sheet declarations and Annexure copies in quadruplicate. Copies of Softex forms, Invoices, SoW, MSA or any other document are not required to be submitted along with summary. H. Additional Information – At the request of STPI, software exporter need to submit additional details about selected sample invoices within 30 days of the request or any reasonable extended time at the discretion of the Director , STPI at the request from the exporter. I. Time Period for additional Information – STPI would do sample audit periodically but not during the period beyond six months, to make the records concurrent with the filing of the Softex. This however, doesn t stop the regulator from asking old records as per FEMA. J. STPI will send the attested Bulk Softex statement in hardcopy to software exporter and soft copy to RBI, Reg

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ormation as under Name and Address of the Exporter Import Export Code number Details of invoice wise collections (Attachment A) SOFTEX Number Name of Customer Invoice Number Invoice Date Invoice Currency Offshore Invoice value Offshore Invoice value realized Date of Realization of exports proceeds Name of the Bank Country of the Bank Details of Foreign Currency Inward Remittance in India(Attachment B). Authorized Dealers will give a control number for this Attachment B, which shall be used by them to settle all the softex forms in Attachment A. Inward remittance in India from overseas bank accounts Name and address of the Authorized Dealer at which the amount has been received Inward remittance details like FIRC number, date, amount and foreign currency Name and address of the Overseas bank from which remittance has been effected Direct Inward remittance in India from customers against exports of software Name and address of the Authorized Dealer at which the amount has been received I

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FEMA – Foreign Exchange Management Act, 1999 – Export of Goods and Services – Forwarder’s Cargo Receipt . – Cir. No. 65 Dated: January 12, 2012 – TMI Updates – Highlights

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FEMA – 65 – Dated:- 12-1-2012 – RBI/2011-12/345 A. P. (DIR Series) Circular No.65 January 12, 2012 To All Authorised Dealers in Foreign Exchange Madam/Sir, Foreign Exchange Management Act, 1999 – Export of Goods and Services – Forwarder s Cargo Receipt Attention of Authorized Dealers is invited to A.P. (DIR Series) Circular No. 27 dated March 2, 2001, in terms of which they may accept Forwarder s Cargo Receipts (FCR) issued by IATA approved agents, in lieu of bill of lading, for negotiation / collection of shipping documents, in respect of export transactions backed by letters of credit, only if the relative letter of credit specifically provides for negotiation of this document in lieu of bill of lading and also if the relative sale

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of repute/IATA approved agents (in lieu of bill of lading), for purchase/discount/collection of shipping documents even in cases, where export transactions are not backed by letters of credit, provided their relative sale contract with overseas buyer provides for acceptance of FCR as a shipping document in lieu of bill of lading. However, the acceptance of such FCR for purchase/discount would purely be the credit decision of the bank concerned who, among others, should satisfy itself about the bona fides of the transaction and the track record of the overseas buyer and the Indian supplier since FCRs are not negotiable documents. It would be advisable for the exporters to ensure due diligence on the overseas buyer, in such cases. 4. Authoriz

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Customs – Customs duty exemption to least developed countries amongst the SAARC countries. – Ntf. No. 99/2011-Customs Dated: November 9, 2011 – TMI Updates – Highlights

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Customs – 99/2011-Customs – Dated:- 9-11-2011 – [TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)] GOVERNMENT OF INDIA MINISTRY OF FINANCE (DEPARTMENT OF REVENUE) Notification No. 99/2011-Customs New Delhi dated the 9th November, 2011 G.S.R.801(E).- In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), and in supersession of the notifications of the Government of India, in the Ministry of Finance (Department of Revenue), No. 51/2008-Customs, dated the 21st April, 2008 [G.S.R. 297 (E), dated the 21st April, 2008] and No. 85/2011-Customs dated 6th September, 2011[G.S.R.662 (E), dated the 6th September, 2011], except as respects things done or omi

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 7-11-2011 Last Replied Date:- 30-12-1899 – While the Government is trying hard with opposition parties to implement the Goods and Services Tax from April next year, a study carried out by the Comptroller and Auditor General of India [CAG] has brought out shocking details of the manner in which several states are operating the Value – Added Tax (VAT) system. Of the 23 states studied, it was found that in 10 states, there was a dip in the average growth of revenue during the past – VAT regime against those relating to pre-VAT period. Those included major states like Gujarat and Tamil Nadu. Though the report attributed the loss of revenue despite increase in tax base to tax evasion th

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etail price of goods despite sharp decline in the rate of tax. As a result, the benefit of ₹ 40 crore was illegally retained by the manufacturers and dealers in the VAT chain instead of passing on the gains to consumers. In another major revelation, in some states, tax exempted manufacturers collected taxes from the purchaser of their goods without remitting it to the state. Consequently, the states incurred a sizeable revenue loss as the purchaser of those goods also claimed input tax credit on those transactions. CAG suggested e- filing of returns be made mandatory in GST and taxpayers must provide basic data for scrutiny to establish the trail of transactions leading to input tax credit. Timeframe for scrutiny of tax returns should

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Allied Laws – CAG REPORT : AN EYE-OPENING FOR GST – Article – TMI Updates – Highlights

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 4-11-2011 Last Replied Date:- 30-12-1899 – The Centre and States recently arrived at a broad consensus on rolling out independent India's biggest tax reforms that will simplify the manner in which corporates, small enterprises and traders will be levied taxes on goods and services. But the main point on which the Government still has to work a lot is the IT Infrastructure . IT infrastructure is going to play a major role in the smooth implementation of Goods and Service Tax. Unique Identification Authority of India (UIDAI) Chairman Nandan Nilekani is working on the IT preparedness for GST .IT infrastructure will play a huge role in interstate GST. Inter-state GST (IGST) will be

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he IT infrastructure needed for the smooth rollout of the proposed goods and services tax (GST) regime. The proposed panel would be authorised to take decisions about the size, features and functionalities of such a system (on GST). The proposed panel will also choose the appropriate technology for GST implementation and select the vendor who will deliver it in a time-bound manner. In a recent development towards the IT Infrastructure, the government announced that it will float a special purpose vehicle (SPV) for setting up information technology (IT) infrastructure for the proposed Goods and Services Tax (GST). The SPV, called GST N (Network), will have the Union government, the states and a technology partner as its stakeholders. Unique

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 3-11-2011 Last Replied Date:- 30-12-1899 – When a ray of hope is coming in the successful implementation of Goods and Services Tax (GST),suddenly a momentum changes in favour of those who are strictly opposing the rolling out of the GST. In the last meeting of the Empowered Group of State Finance Ministers on GST to thrash out all pending issues , three major issues arises in front of the Government , with several states giving a thumbs-down to the draft Constitutional Amendment Bill prepared by the Centre. These major issues are: 1. Veto Power: In this meeting , states ruled by political parties other than the Congress came out openly against the proposal to give veto power to the

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Amendment Bill and may be incorporated in GST Legislation. 3. Petroleum Products: Another major issue is relating to the Petroleum products. Finance Minister Mr. Pranab Mukherjee suggestion to include petroleum products within the GST ambit has underlined the need for a fresh discussion paper on the GST. However, most of the states are looking positively towards the inclusion of petroleum products under the GST, but its implementation at this stage is not advisable. In addition to these issues, some of the statements which are given by the Finance Ministers against the current structure of GST are: GST implementation from April next year is not possible [Mr.Raghavji ,MP Finance Minister] States are left with no powers in the proposed draft

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 2-11-2011 Last Replied Date:- 30-12-1899 – The central and state governments moved closer to ushering in a nationwide goods and services tax on April 1, 2011, that will simplify the manner in which corporates, small enterprises and traders will be levied taxes on goods and services. The reform would eliminate multiple indirect taxes levied by states and the central government, that will not only make life easier for most manufacturing companies but also allow products and services to be priced uniformly across the country. On Wednesday, federal and state finance ministers emerged from a meeting saying they had narrowed differences that have delayed implementation. States are worrie

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entation of the goods and service tax (GST) can give a trillion-dollar boost to the economy, taking the total output to $2 trillion in a short span of time. The gain from GST will propel the country from one-trillion dollar economy to two trillion-dollar economy in a short span of time. Well designed GST will see an increase of 2 to 2.5 per cent in the GDP. The government will also float a special purpose vehicle (SPV) for setting up information technology (IT) infrastructure for the proposed Goods and Services Tax (GST). The SPV, called GST N (Network), will have the Union government, the states and a technology partner as its stakeholders. In a presentation given to the empowered committee of state finance ministers today, Unique Identifi

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ering the tax needs to be created. There is a hope that the legislation will be introduced in parliament in the session that begins on July 26. Pranab Mukherjee has set a deadline of August 20 for states to give their final consent on the new duty structure and all other pending issues, including the proposed constitutional amendment. This is to enable him to move the GST Bill in the monsoon session of Parliament. The empowered group of state FMs has decided to meet on August 4 in the Capital to thrash out all pending issues. LAWCRUX TEAM Import export trade, Custom duty, Central excise duty, GST, Indirect tax services, indirect tax, advance license, foreign trade policy, tax planning, e-book, EOU, SEZ, NEPZ, EPCG, DFRC, CBCC, DGFT, DEPB {

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 23-10-2011 Last Replied Date:- 30-12-1899 – The actual challenge before the Finance Minister is not of drafting a model GST but of its proper implementation and smooth transition from the prevailing system. The challenges which the Government has to face in introducing GST are as follows: * Rapid increase in Assesses: The dual GST model will widen the tax net by taxing every economic supply in the distribution network. This will lead to rapid increase in assesses. It will require some of the businesses to restructure their distribution network to reduce additional tax burden on the consumer with a view to be price competitive. Though it will generate revenue in a neutral and transparent way, the Government will have to ensure that the ultimate consumer is not burdened with tax beyond his capacity. * Place of Supply: One of the main challenge in introducing in GST is defining the place of supply in respect of certain services a

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from bringing about any change in this structure. In order to enable the Centre and the State Governments to levy GST, the Constitution of India requires amendment to provide for powers to levy and collect GST both by the Union and the States. However, in a landmark decision, the UPA Government has resolved to amend the Constitution to enable states to have the same powers as the Centre in administering the proposed Goods and Services Tax (GST). For the purpose, a new Fourth List is proposed to be created in the Seventh schedule of the Constitution. The Fourth List visualises a governing council headed by Union Finance Ministry and comprising state finance ministers as its members. The council will have overriding powers on issue of indirect taxes. * Improvement in Banking System: In case of destination based principle of taxation, the recipient State will have to levy the tax as per the law of the dispatching State. This is bound to create problems if there is no uniform law and rate

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st track. IT infrastructure will play a huge role in interstate GST. IGST will be collected and passed on the states. It will have to be transferred electronically . * Effective Credit Mechanism: The success of dual GST model will depend on effective credit mechanism to avoid cascading effect of multi-stage taxation in the supply chain. The credit mechanism is the lifeline of GST. As far as Central GST is concerned, there is no difficulty in giving credit of Central GST anywhere in India as is evidenced by success of the present CENVAT scheme. But, in case of State GST presently there are issues in giving credit in relation to inter-State transactions. The challenges posed by GST are no different from what other countries have faced while implementing major tax reforms. Despite the various impediments to the proposed transition, once implemented GST is likely to usher in a more taxpayer friendly regime that could help make various business decisions 'tax neutral' . Until the ti

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 18-10-2011 Last Replied Date:- 30-12-1899 – In Japan, the equivalent of VAT or GST is known as Consumption Tax(CT) and was introduced in January 1989. It requires re-calculation and payments to the tax authorities at each transaction point in the onward sales chain. The Japanese Consumption Tax rate is currently 5% and out of which 4% is national levy and 1% regional levy. Companies are not required to formally register with the Japanese Tax authorities for Consumption Tax . The tax authorities takes into account the first tax filing as the application for registration and a tax office will be allocated to the company. A foreign, non-resident trader is required to appoint a tax age

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company s transactions related to the supply of the relevant goods or services. If there is any consumption tax due that should be paid simultaneously with the filing of the tax return. The tax authorities require payments of CT liabilities to be made in Japan at an authorised bank or post office. There may be a statutory obligation for foreign companies providing goods or services in Japan to charge Consumption Tax. This includes the ongoing compliance requirements to file periodic tax returns and pay over any consumption tax due to the Japanese tax office. Following are the situations which require Japanese compliance: * Where goods are delivered within Japan * Supply of services. For e.g: consulting services, sports events, entertainmen

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 12-10-2011 Last Replied Date:- 30-12-1899 – Goods and Services Tax in Malaysia may be implemented by the Malaysian Government somewhere in the third Quarter of 2011. 4% GST will replace the current sales and service tax currently levied at rates between 5% and 10%. Companies with revenue RM 500,000 and below would be exempted from imposing GST and about 70% of small and medium sized industries would also be exempted. The taxpayer must be registered with the Royal Malaysian Customs once the taxpayer achieves a certain prescribed annual sales turnover i.e. above RM 500,000. The registered taxpayer would also be required to submit periodic GST returns. Being a broad based tax, GST can

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ull; Only one out of the 11 working adults in the country pay income tax and revenue from this source is meagre. • Out of the total population of 28 million people in the country, only 1 million pay income tax. • 40% of the country s total revenue comes from the oil and gas industry. Oil and Gas is not a reliable source of revenue over the medium to long term because the commodities are depleting natural resources, and their prices are volatile. • The country has been stuck with Fiscal Deficits for more than a decade. The budget deficit is projected to have reached to a record high of more than 7% of the country s Gross Domestic Product [GDP] last year. The country cannot continue raising Debts to finance its deficits, otherw

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ecomes, it would be more costly for the Government to administer and for businesses to comply with it. Ø Pricing and embracing appropriate technology in areas such as GST collection at every stage of the supply chain. Ø To create awareness among the public so that they will understand GST better. GST is a grossly misunderstood concept and that s why certain quarters oppose the idea of having it and leads to its postponement. It is responsibility of the Government to educate all the stakeholders in the economy about the system to give them a bigger picture of the GST. A strong political will is needed to ensure GST becomes a reality in the Malaysian economy because any tax reform of this nature tends to meet with resistance a

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Allied Laws – Goods and Services Tax (Malaysia) – Article – TMI Updates – Highlights

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 5-10-2011 Last Replied Date:- 30-12-1899 – Taxation in New Zealand is collected at a national level by the Inland Revenue Department (IRD) on behalf of the Government of New Zealand. National taxes are levied on personal and business income, as well as on the supply of goods and services. Goods and services tax (GST) is an indirect tax introduced in New Zealand on October 1, 1986 at 10%, and later increased to 12.5% on July 1, 1989, and is to be increased to 15% on October 1, 2010. This brought a major change in New Zealand taxation policy as until this point almost all revenue had been raised through direct taxes. Now 19% of the New Zealand Government's core revenue comes from GST. Most products or services sold in New Zealand incur GST at a rate of 12.5%. End-users pay this tax on all liable goods and services directly, in that the purchase price of goods and services includes GST. All businesses are required to register

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d income. Calculate GST by dividing the sales and the income figure by 9. Similarly claim GST @12.5% for purchases and expenses. Calculate GST by dividing the purchases and expenses figure by 9. Taxable goods and services includes: Goods include all types of personal and real property, except money. Services covers everything other than goods or money, e.g. TV repairs, doctor's services and gardening services Taxable goods and services don't include: goods and services supplied by businesses that aren't registered for GST, and exempt supplies such as: rent from Domestic Accommodation. interest you receive donated goods and services sold by a non-profit body, and certain financial services. GST-registered organizations only pay GST on the difference between what they sell and what they buy: income less expenditure. This is accomplished by reconciling GST received through sales and GST paid (through purchases) at regular periods typically every 2 months .H

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e only exceptions are for businesses which claim a mainly wholesale client-base. Otherwise, displaying a prominent GST-exclusive price (i.e. larger and more obvious than the GST-inclusive price), is illegal. Recently, GST increased to 15% in May 2010 budget which is going to be implemented from Oct 1, 2010. As a result, businesses will need to make many critical decisions about issues such as pricing points, updating business systems, GST stipulations in long-term contracts, logistics around repricing consumer goods, and updating promotional material. This new rate will also create challenge for tourism operators who have set their prices up to 2012. The most immediate concern for the majority of SMEs, particularly those selling goods and services directly to consumers, will how much to increase prices. Hence all the businesses including SMEs in New Zealand have to take crucial decisions in dealing with this new tax rate i.e.15% as Oct, 2010 is not so far away. LAWCRUX TEAM – Articles

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Goods and Service Tax – GST – By: – Nagesh Bajaj – Dated:- 3-10-2011 Last Replied Date:- 30-12-1899 – In Canada Goods and Services Tax (GST) is a multi-level value added tax introduced on January 1, 1991, by Prime Minister Brian Mulroney and Finance Minister Michael Wilson. The GST replaced a hidden 13.5% Manufacturers Sales Tax (MST); Mulroney claimed the GST was implemented because the MST hurt the manufacturing sector's ability to export and also replaced the Federal Telecommunications Tax of 11%.The introduction of the GST was very controversial. As of May 18th, 2010, the GST rate is 5%. The European model has helped to become the Canada s economy more efficient and competitive with lower-priced goods in the international market. H

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and services. The Federal Goods and Services Tax (GST) is collected by the Canada Revenue Agency (CRA). GST is a tax that applies at a rate of 5% to the supply of most goods and services in Canada . Three provinces ( Nova Scotia , New Brunswick , and Newfoundland and Labrador ) harmonized their provincial sales tax with GST to create HST. HST applies to the same base of goods and services as GST, but at a rate of 13%. Of this, 5% is the federal part and 8% is the provincial part Some specific products and services are exempt from GST. Such as Most health, medical, and dental services performed by licensed physicians or dentists for medical reasons; Child-care services; Long-term residential accommodation; Most goods and services provide

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goods and services that are not exempt from GST is a lot more than those which are zero-rated. Certain lower income segments of the population, while not exempt from paying GST, may be eligible to receive quarterly GST credits. The GST/HST credit is a tax-free payment that helps offset all or part of the GST or HST paid. Provincial Sales Tax (PST) is also called Retail Sales Tax (RST). In Quebec this tax is called QST. The tax is collected at the provincial level. Each province could charge consumers differently. The following list shows the current rates. The rates could change in the future. Ontario 8% British Columbia 7% Alberta 0% ( Alberta does not collect provincial sales tax) Manitoba 7% Quebec 7.5% Prince Edward Island ( PEI )

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