Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 11-2-2016 – GST, when comes, shall impact almost every one individually and to all sectors of trade and industry. Some of the sectors are discussed hereunder. Land, Real Estate, Renting Presently, Real estate transactions are taxed as levy of stamp duty. Renting/leasing transactions are covered under Service Tax. However, long-term leases suffer both, stamp duty and Service Tax and are under litigation presently. Construction activities and works contracts relating to construction/EPC contracts/installations etc are also liable to Service Tax as well as works contract tax (as VAT). As such, this sector is heavily under multiple tax burden. As of now, it is not clear as to whether real estate / land activities will be brought under the GST net or not as this sector provides major tax revenue to both, centre and states. In many other countries, construction and selling of houses is treated as a commodity and taxed to VAT
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
Railways. While IR has a separate budgetary allocation by way of Rail Budget, its operations are subject to certain direct / indirect tax provisions in terms of direct tax, excise duty, service tax, Swachh Bharat Cess (SBC) etc. IR operates through zones, divisions and most of public sector undertakings, besides various business models / projects under PPP/JVs. Major revenue sources of IR include freight, passenger fare, advertisement & publicity, land lease, other leases etc. Looking to the expansion, modernization and maintenance of railways, IR is in urgent need of funds or schemes whereby IR can raise funds efficiently at low cost to meet its short term / long term financial requirements. Following issues need consideration from indirect taxes view point under the GST regime High Speed Diesel (HSD)/Light Diesel Oil (LDO) consumed by Indian Railway may be considered as input for the purpose of Cenvat Credit. Railway locos/coaches being used in-house (captive consumption) may be
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
in the form of margin and is hidden in the form of interest, dividend, annuity payments etc. In India, most of the banking and financial services are exposed to levy of Service Tax but interest is in the negative list. Through the Select Committee of Rajya Sabha also advocated for exclusion of financial services from levy of GST based on the representation of banking industry, it is felt that there does not appear to be any economic logic or reason as to why such services should not suffer levy of GST. However, Cenvat credit should be allowed on such transactions. Since interest is a return on money lent to borrowers, it may continue to the out of GST net. Presently, leasing companies are burdened with both taxes- VAT as well as Service Tax. In GST regime, it is expected that such anomaly will go and there should not be dispute on the nature of transaction and it would be easier to decide as to when will a transaction in relation to transfer of right to use goods takes place in course
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =