Stock Watch

2010 – 2011 electronically for some time now as the government has suspended the facility as it could not get the renewal for the security certificate of its e – filing portal as the security certificate for the income tax department’s e filing portal had lapsed on May 8 this year. The E filing that gives the tax payer the convenience to file the tax return from any place using a computer , had to be suspended due to lack of completion of security facilities.

The Government has managed to identify nine territories, with which it may negotiate treaties to seek information on tax avoidance. Up till now, India could enter into tax agreements with countries only, but after the amendment was done in Income Tax Act in the Finance Act, 2009, the Government can also enter into agreement with ‘specified’ regions.

A new tax rate has been imposed on any income received without a permanent account number (PAN) from April 1 this year.

The income which is liable to tax deducted at source will see tax as high as 20% if the earner does not quote a PAN. The union government has made it mandatory for all residents and non-residents to quote a PAN if they want to avoid heavy withholding tax.

While increased allocation for the power sector may trigger new investment opportunities for engineering contracts, the lift in the minimum alternative tax rate is expected to extend an impact on profitability of companies involved in the business of power generation, distribution and transmission.

The Union Budget has announced a hike in MAT to 18% from 15%, a move that is revealed to significantly raise the tax burden of corporate entities.

States and the Centre want different rate of the proposed Good and Services Tax (GST) and thus its implementation is likely to be further delayed beyond April 1, 2010.

The tax burden is all set to be reduced. The Government today announced that tax would come down by 25-30% from the next financial year.

P V Bhide, the Revenue Secretary said that the tax payers would be substantially relieved, as the burden of tax would be pulled down by around 25-30%, after GST comes in starting 1 April 2010. He also said that GST will enhance the competitive edge of both the manufacturing and services industries.

Despite the speedy recovery of the economy and strong quarterly growths, the Government's direct tax collections have recorded a mere 3.7% rise to Rs. 1.83 lakh crore in the current fiscal year's first 8 months, as compared to the same time last year.