Tez to take India closer to digital transformation: Pichai

Sep 19, 2017 0

New Delhi– A day after Google launched its new digital payment app “Tez” in India, the company’s Indian-born CEO Sundar Pichai on Tuesday tweeted it will help India move closer to digital transformation.

“We hope that the launch of @TezByGoogle will help take India one step closer to your vision of @_DigitalIndia,” Pichai tweeted.

Finance Minister Arun Jaitley who launched the app here had said the idea of “Tez” was discussed by Pichai in January, just after demonetisation.

“Google saw a great potential in Indian economy and businesses,” Jaitley said, adding that Google’s new digital payments app over the next few months was likely to make major advances in digital transaction volumes.

Sundar Pichai

Built on the Indian government-supported Unified Payments Interface (UPI), Tez allows users, free of charge, to make small or big payments straight from their bank accounts.

The app was built for India, working on the vast majority of the country’s smartphones and available in English and seven Indian languages (Hindi, Bengali, Gujarati, Kannada, Marathi, Tamil and Telugu).

The app works in partnership with four Banks — Axis Bank, HDFC Bank, ICICI Bank and State Bank of India — to facilitate the processing of payments across over 50 UPI-enabled banks.

According to D.D. Mishra, Research Director, Gartner, Tez provides promising features which are in-line with the requirements.

“It is too early to say whether it can be a game changer as evolution in this business is going to continue, but yes it has the capabilities to bring some disruption as of now,” Mishra said in a statement.

Moreover, Google’s information about an individual’s preferences can play a good role in enabling business to know their preferences and provide offers with interesting options.

“The mobile wallet industry too, is evolving and we are at an interesting stage in this competition. Eventually, UPI payments will have an upper hand if it continues to remain free and provide better security, convenience and add more Value Added Services,” Mishra informed. (IANS)

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Exporters’ woes under GST: Working capital stuck as refunds not available

Sep 10, 2017 0

By Meghna Mittal

New Delhi–Exporters are having a tough time since the roll-out of the new indirect tax regime as the online facility to claim refunds is not yet available, with many even postponing shipments as they grapple with low funds, stakeholders and experts have said.

The worries are greater for small and medium exporters who have a turnover of less than Rs 20 crore as their cost of working capital has significantly risen with refunds not coming so far under the Goods and Services Tax (GST) regime.

“We estimate an additional working capital of Rs 1.5 to Rs 2 crore for us. At present, refunds can’t be claimed as Goods and Services Tax Network (GSTN) system is not yet operational. We have to pay GST on procurement and also keep control on all vendors to ensure that they pay GST,” Vilas Phule, CFO, Magna Steyr India, which exports engineering services in the automobile sector, told IANS.

The company with a monthly turnover of Rs 6 crore to Rs 8 crore, exports services worth Rs 4 crore to Rs 6 crore every month.

Certainly, this was putting exporters in a lot of working capital pressure, he added.

Jigar Doshi, Partner, SKP Business Consulting, said: “At present, exporters are unable to file refund claims online as no facility/utility is available at GSTN website and is unknown as to when it will be made available. Now, working capital blockage is proving to be big hurdle particularly for small exporters, who do not have deep pockets.”

GST expert Pritam Mahure said, “In GST regime, exporters are facing challenges as the upfront exemption is not available and given this working capital of exporters is getting blocked. I hope that the government forms a high level committee to address their challenges or else the working capital blockage can derail the struggling exports scenario in India.”

In the previous indirect tax regime, exporters enjoyed upfront tax exemption on goods to be exported. But under GST, exporters are procuring goods and services on payment of GST. This credit of GST, which is available with exporters is supposed to be claimed as refund.

Under GST, there is also Integrated GST applicable on the export turnover, for which there are two methods available — one to export without payment of GST (under cover of Letter of Undertaking or Bond) and second with payment of IGST and then claim refund of it.

“In our case, we have 80 per cent export of services. Hence, GST paid on procurement of services which needs to be claimed as refunds. If exemptions, similar to the one given under previous indirect tax regime, are granted then the funds blockage can be optimised along with reduction in unnecessary administrative work for paying GST and then claiming refunds,” Phule said.

The former GSTN Chairman Navin Kumar, who retired recently, said, “For exporters, it is not yet available. For exporters there is going to be a separate form where he can claim refund of IGST. Currently the online facility is not active on GST portal.”

Amar Kulkarni, CFO, Hoerbiger India, which exports gas compressor valves for the petroleum industry, said, “Given the working capital pressure, many exporters are postponing the exports and are struggling for funds. This entire process of claiming refund by exporter can be eased through upfront exemption.”

The exporter is required to capture details of monthly export for GST return and this is a tedious work, he said.

Another exporter Samir Oke, who exports thermocol for refrigerators admitted that his company was facing a problem of blockage of working capital with GST.

“Even, in case of procurement from unregistered vendors, the company is required to pay GST which further leads to increase in working capital requirement,” Oke, CFO, K K Nag Pvt Ltd, told IANS.

“We faced numerous challenges in obtaining a Letter of Undertaking for exporting goods without IGST. The said procedure was expected to be online but practically we had to visit and follow up with the authorities for the same,” he added.

Doshi said, “Prior to GST regime, there was no requirement to obtain Letter of Undertaking for exporting services, which is mandatory in GST regime and given this service exporters face numerous challenges. The government should identify key challenges faced by exporters and address the same immediately.”

Further, the refund of GST can be claimed only if the vendors pay GST and this is required to be tracked by the company, which is leading to more hassles for the exporters.

“There are various requirement as far as input tax credit is concerned. It is very difficult to communicate with numerous vendors and ensure that they are paying GST. The company is required to ensure that vendors are paying and filing returns in case of a registered vendor. In case of unregistered vendor, the company not only has pay the GST but is also required to raise the tax invoice and payment voucher, which is a tedious and time consuming process,” Oke said.

Hoerbiger India said, “We are being held responsible for compliance by vendor, which is unreasonable as SME exporters don’t have manpower to ensure all these.”

To add to the woes, recurring breakdowns of the GSTN system are making things worse for the exporters.

“GSTN system is not ready and we are facing numerous errors in the system during filing of GST returns,” Magna Steyr India said.

Hoerbiger India said, “Exporters are investing a lot of time during return filing process as the GSTN system is not robust. If such problems continue then the company will have to focus only on returns on that export.”

There is no surety on whether the tools or website will work on a particular day as due to traffic surge GSTN system was down multiple times, thus exporters are facing challenges in filing of GST returns, Oke protested.

Anita Rastogi, Partner, PwC – GST and Indirect Tax, said, ” The largest issue being faced by an exporter is that of additional working capital requirement. There are teething problems being faced by exporters on the procedural side. It is important that the interests of exporters are safeguarded and this should be taken on priority by the government.” (IANS)

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Limited access to capital, gender bias biggest challenges for Indian women entrepreneurs

Sep 7, 2017 0

Kolkata– Lack of access to capital, gender bias at work place and a weak infrastructure in capacity building for women to derive necessary skill sets are the “key challenges” in the way of women entrepreneurship in India, a US-based woman entrepreneur and investment banker said here on Thursday.

“In India despite all the pro women government schemes, the awareness of how to get access to capital is very limited. The women may manage to get the debt but the access to private equity in the form of venture funding or mid to late stage funding is minimal,” Accelerator Group LLC Managing Director Seema Chaturvedi said in a media round table organised by the US Consulate General Kolkata at the American Center here.

Seema Chaturvedi

She also stated that the women are victims of gender bias at workplace across the world and are stereotyped primarily as care givers in the household.

“It came out during the workshops that whether the woman is from New York or from Coimbatore, there were slimier experiences of significant gender bias at the work place. These experience was not related to being an entrepreneur but is more related to being a woman,” she claimed.

In the run up to the upcoming Global Entrepreneurship Summit (GES) 2017, Chaturvedi was in the city to engage with Global Links students, government officials, entrepreneurs, businessmen, start-ups, and NGOs for promoting entrepreneurship, innovation and business incubation through programmes.

Claiming that the capacity building for women skills is strongly missing in this country, she said a lot women entrepreneurs in India do not have an ability to access certain opportunities as they lack certain soft skills like pitching their ideas to the investors.

“A lot of women either do not have access or are not aware of the opportunities, Some of them do not know how to pitch. So the bottleneck is more societal,” she added. (IANS)

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India to become 5th largest consumer market by 2030

Sep 7, 2017 0

New Delhi–India will become the fifth largest consumer market in the world by 2030, a joint report said here on Thursday.

According to a Ficci-Deloitte report on the retail, fast moving consumer goods (FMCG) and e-commerce sectors in the country, the consumer retail industry is expected to reach a size of Rs 85 trillion by 2021.

“Consumer retail forms an integral part of the industry with a current estimated size of more than Rs 45 trillion,” said the report “Konnected to Consumers”.

“It is further expected to witness a CAGR of over 10 per cent in the period 2016-21 to reach a size of Rs 85 trillion by 2021,” it added.

The report said the consumer industry is one of the most dynamic and amongst the fastest growing industries in India.

Although optimism is well founded and makes India attractive to FMCG firms and retailers, challenges remain like poor basic infrastructure, a complex multi-layer regulatory and taxation regime, the report added. (IANS)

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Delhi businessman commits suicide after killing wife, son

Sep 5, 2017 0

New Delhi–A scrap dealer under depression for heavy business losses committed suicide after killing his wife and teenage son in west Delhi, police said on Tuesday.

Police said the late Monday night crime came to light on Tuesday when scrap dealer Om Prakash’s elder son informed Nihal Vihar Police Station.

Om Prakash, 45, was found hanging from a ceiling fan at his residence in Nihal Vihar while bodies of his wife Sujata, 43, and son Prince, 12, with stab wounds were found lying on the first floor.

A police officer reportedly quoted a suicide note of Om Prakash recovered from the spot: “Who will take care of my family after me? I have killed my son and wife and am going to commit suicide.”

His elder son Nitin, who works for a telecom company, had gone to his uncle’s house in the neighbourhood when the crime occurred, Deputy Commissioner of Police Pankaj Singh said.

Nitin said he returned home early Tuesday morning and went to sleep in a room on the ground floor. When he was not called for breakfast, he called out his mother but got no response, Singh said.

He went upstairs and found his father hanging, and mother and brother lying in a pool of blood. A baseball bat, a blood-stained knife and the suicide note were lying around the bodies, he added.

Prima facie, Om Prakash hit his wife and son in their heads with the baseball bat while they were asleep. He later stabbed them half-a-dozen times each. When he was sure of their death, he wrote the note and hanged himself, the officer added. (IANS)

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Demonetisation to have high short-term economic costs, Rajan cautioned government

Sep 5, 2017 0

New Delhi– The demonetisation tool used by the Indian government to drive out black money could have long-term benefits but its short-term economic costs would outweigh them, ex-Reserve Bank of India governor Raghuram Rajan feels.

“I was asked by the government in February 2016 for my views on demonetisation, which I gave orally. Although there might be long-term benefits, I felt the likely short-term economic costs would outweigh them, and felt there were potentially better alternatives to achieve the main goal,” Rajan writes in his book “I do what I do” published by Harper Businss, an imprint of HarperCollins Publishers India. The book is to be launched by Rajan in Chennai on Tuesday.

The Indian government undertook the demonetisation drive on November 8, 2016 by banning high denomination Rs 1,000 and Rs 500 notes.

Rajan’s term as RBI governor ended on September 4, 2016.

Raghuram Ranjan

He further wrote on demonetisation: “I made these views known in no uncertain terms. I was then asked to prepare a note, which the RBI put together and handed to the government. It outlined the potential costs and benefits of demonetisation, as well as alternatives that could achieve similar aims.”

He said that “If the government, on weighing the pros and cons, still decided to go ahead with demonetisation, the note outlined the preparation that would be needed, and the time that preparation would take. The RBI flagged what would happen if preparation was inadequate.”

“At no point during my term was the RBI asked to make a decision on demonetisation,” Rajan said in the introduction to the book.

Mentioning that his book was not a ‘tell-all’, Rajan stated that many questions were posed to him since he left the post of RBI governor but he had “resolutely refused to answer until my period of silence is over”. He gave himself one year. The book is an edited collection of his speeches and articles. (IANS)

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Tata Motors President and CTO Leverton resigns

Sep 4, 2017 0

Mumbai–Automobile major Tata Motors on Monday said that its President and Chief Technical Officer Timothy Leverton has decided to “disengage from his services in the organisation”.

According to the company, Leverton decided to leave the organisation as “he wishes to relocate back to UK for personal reasons”.

Leverton has been associated with Tata Motors since 2010, working out of the Tata Motors Engineering Research Centre in Pune.

“Leverton will continue to remit his responsibilities till October 31, 2017. The successor to Leverton will be announced in due course of time,” the company said in a statement.

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India’s Forex reserves rise by $1.14 billion to $ $394.55 billion

Sep 1, 2017 0

Mumbai– India’s foreign exchange (Forex) reserves kitty increased by $1.148 billion as on August 25, 2017, official data showed on Friday.

The Reserve Bank of India’s (RBI) weekly statistical supplement released on Friday showed that the overall Forex reserves rose to $394.55 billion from $393.40 billion reported for the week ended August 18.

India’s Forex reserves comprise of foreign currency assets (FCAs), gold reserves, special drawing rights (SDRs) and the RBI’s position with the International Monetary Fund (IMF).

Segment-wise, FCAs — the largest component of the Forex reserves — augmented by $1.142 billion to $370.83 billion during the week under review.

Besides the US dollar, FCAs consist of nearly 20-30 per cent of major (non-US) global currencies. The FCAs also include investments in US Treasury bonds, bonds of other selected governments and deposits with foreign central and commercial banks.

The country’s gold reserves were stagnant at $19.94 billion.

However, the value of SDRs increased by $2.3 million to $1.49 billion.

Similarly, the country’s reserve position with the IMF edged higher by $3.6 million to $2.27 billion. (IANS)

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Cabinet approves raising GST cess on luxury cars to 25%

Aug 30, 2017 0

New Delhi–The Union Cabinet on Wednesday approved an ordinance to raise the ceiling on GST cess for luxury vehicles and SUVs from the current 15 per cent to 25 per cent. This can lead to a hike in prices of high-end cars.

Briefing reporters after the Cabinet meeting, Finance Minister Arun Jaitley said it was decided to recommend to President Ram Nath Kovind to promulgate an ordinance in this regard.

The decision on raising the cess on luxury cars would be taken by the GST Council, he said.

Explaining the rationale, Jaitley said that pursuant to the implementation of Goods and Services Tax (GST), the price of luxury vehicles had substantially come down.

“Objective of any taxation policy can’t be that luxury goods becomes cheaper. Relief has to be given to a common man’s item and not a luxury item,” he said.

Currently, the luxury cars and sports-utility vehicles (SUVs) are taxed at 28 per cent under GST along with a cess of 15 per cent.

“The ordinance is only an enabling law so that cap for those luxury vehicles can be increased to 25 per cent.

“This doesn’t mean that cess will automatically increase. The GST Council, whenever it meets, is entitled to take a decision if it wishes to increase the cess within the cap,” he said.

In relation to certain products like cigarettes, tobacco and luxury vehicles, a cess was permitted under the GST, which goes into a compensation pool, from which any state that loses revenue in first five years would be compensated.

Replying to a question whether the GST rates would come down, Jaitley said it was a new experiment and one would have to see the pattern for a considerable time.

“The GST Council acts on expert advice. Optimum level of taxation has to be kept in mind. No comment on rates. This is an experiment. It has started off well. Collections are reasonably buoyant. We will see how it progresses. The objective was that those who are not paying taxes, start paying them,” he said.

The ordinance was needed to amend the Schedule to the GST (Compensation to State) Act 2017, that currently specifies 15 per cent as the maximum cess rate for luxury vehicles and SUVs.

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Income tax department imposes Rs 7,900 crore penalty on Hutchison

Aug 29, 2017 0

New Delhi–The Indian Income Tax department has slapped a penalty of Rs 7,900 crore on the tax demand of the same amount on CK Hutchison Holdings Ltd for the sale of its mobile phone business to Vodafone Group Plc in India.

“HTIL (Hutchison Telecommunications International Limited) received on February 13, 2017, from ITA (Indian Income Tax department) an assessment order dated January 25, 2017, in respect of tax of approximately Rs 79 billion (HK$9.6 billion) on capital gains in connection with the acquisition plus aggregate interest on the CGT of approximately Rs 164.3 billion (HK$20 billion),” the company said in a filing in Hong Kong stock exchange.

“HTIL received on August 9, 2017, from ITA a penalty order dated July 3, 2017, for a penalty of approximately Rs 79 billion (Rs 7,900 crore),” the statement added.

“For the reasons set out in the announcement, HTIL continues to believe that the taxes cannot be validly imposed on HTIL,” the statement added.

In 2007, Vodafone had acquired 67 per cent stake in the cellular business of Hutchison Whampoa, which is now part of CK Hutchison. (IANS)

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