Year End Review-2015, Department of Revenue, Ministry of Finance

Year End Review: Highlights of the Achievements of the Department of Revenue, Ministry of Finance

Question: During April-October 2015, indirect tax collections increased by what percentage over the collections made during the same period last year?

(a) 35.9%
(b) 25.5%
(c) 30.2%
(d) 20.8%

Ans (a)

Related facts:

  • On 17 December 2015, Department of Revenue of Ministry of finance published Year End Review of the year 2015.

Indirect Tax Collections:

  • In October 2015, indirect tax revenue (provisional) collections increased by 8% compared with collections made in October 2014.
  • During April-October 2015, indirect tax collections increased by 35.9% over the collections made during the same period last year.
  • Overall, in monetary terms, the indirect tax revenue (provisional) collections were Rs 3, 82,860 crore during April-October 2015.
  • Collections on account of Central Excise increased to Rs.1, 47,685 crore in April-October 2015 with an increase of 68.6 %.
  • Collections on account of Customs increased to Rs. 1, 22,448 crore in April-October 2015 with an increase of 16.8 %.
  • Customs duty on certain inputs was reduced to address the problem of duty inversion.
  • The Special Additional Duty of 4% which is levied on imported goods to counter balance the local taxes levied by States (other than excise duty) was reduced/exempted.
  • Basic customs duty was increased on metallurgical coke from 2.5% to 5% and on commercial vehicles from10% to 20%.
  • Basic customs duty on specified steel goods was increased to 10% / 12.5%

In order to protect the interests of domestic farmers, the following measures were taken:

  • Basic customs duty was increased on sugar from 15% to 25% which was later increased to 40%.
  • Excise duty was exempted on ethanol produced from molasses generated from cane crushed in the sugar season 2015-16 i.e. 1st October, 2015 onwards.
  •  Basic customs duty was increased on crude edible oils (of vegetable origin) from 7.5% to 12.5% and refined edible oils (of vegetable origin) from 15% to 20%.
  • Basic customs duty was increased on ghee, butter and butter oil from 30% to 40% for a period up to and inclusive of the 31st day of March, 2016.

The objective of improving the quality of life and public health through Swachh Bharat initiatives was achieved by the following measures:

  • Clean Energy Cess levied on coal, lignite and peat was increased from Rs.100 per tonne to Rs.200 per tonne.
  • Concessional customs and excise duty rates on specified parts of Electrically Operated Vehicles and Hybrid Vehicles was extended upto 31.03.2016.
  • Excise duty on sacks and bags of polymers of ethylene other than for industrial use was increased from 12% to 15%.
  • In order to allocate additional resources to infrastructure, the effective rates of Additional Duty of Customs / Excise levied on Petrol and High Speed Diesel Oil commonly known as Road Cess have increased from Rs.2 per litre to Rs.6 per litre.
  • In keeping with the declaration of 21 June as the International Day of Yogaby UN General Assembly, charitable activities relating to advancement of Yoga have been exempted from Service tax.

Enforcement:

  • The DRIhas been awarded for the second year running the United Nations Environment Programme (UNEP)’ Asia Environmental Enforcement Award (AEEA).
  • The DRI, for the first time ever launched an International Operation – “Operation Sesha” in the Asia-Pacific Region (named after Seshachalam Hills in Andhra Pradesh where Red Sanders grows) to combat smuggling of all species of timber including Red Sanders.

Taxpayer Services:

  • The CBEC has declared 2015 as theYear of Taxpayer Services.
  • CBEC has set up a newDirectorate of Tax Payer Services with headquarters at New Delhi.

Legislative steps:

  • The levy of Wealth-tax has been abolishedwith effect from 2016-17 (Assessment Year) for reducing the compliance burden on the tax payers.
  • Clarity in taxation of indirect transfer has been broughtthrough Finance Act, 2015
  • Income arising to foreign portfolio investors from transactions in securities to be treated ascapital gains.
  • “Roll Back” provision has been introduced in the Advance Pricing Agreement (APA) regime
  • The threshold limit for applicability of transfer pricing regulationsto specified domestic transactions has been increased from Rs. 5 crore to Rs. 20 crore.
  • Eligible date for borrowing in foreign currency has been extendedfrom 30.06.2015 to 30.06.2017 for concessional tax rate of 5 percent on interest payments.
  • Rate of tax on royalty and fees for technical services has been reduced(25% to 10%)
  • ‘Yoga’ has been included as a specific category of activity in definition of ‘charitable purpose’
  • Personal Income Tax exemption limit was raisedto Rs. 2.5 lakhs in the case of individual taxpayers below 60 years of age. Exemption limit raisedtoRs. 3 lakhs in the case of senior citizens that is individuals in the age bracket of 60 years to 80 years.
  • Investment limit under section 80C of the Income-tax act has been raisedfrom 1 lakh to 1.5 lakh.
  • Limit of deduction under section 80CCD of the Income-tax act on account of contribution by the employee to National Pension Scheme (NPS) has been increasedfrom Rs. 1 lakh to 1.50 lakh.
  • The limit of deduction under section 80D of the Income-tax act has been increasedfrom Rs. 15,000 to Rs. 25,000 on health insurance premium.

Measures to curb black money:

  • The Benami Transactions (Prohibition) Amendment Bill, 2015 has been introduced in Lok Sabha to amend the Benami Transactions (Prohibition) Act (BTPA) 1988.
  • India and United states signed Inter governmental Agreement (IGA) to implement the Foreign Account Tax Compliance Act (FATCA) to promote transparency on Tax matters.
  • It has been decided that quoting of PAN will be required for transactions of an amount exceeding Rs.2 lakh regardless of the mode of paymen

E- Governance activities:

  • The progressive number of PANs allotted till 31st March, 2015 is 22,32,47,190.
  • The number of registered users of the e filing portal as on 31stOct 2015 is about 4.86 crore.
  • The Income Tax Department has initiated ‘Project Insight’for improving compliance and effective utilization of information in all areas of tax administration.
  • Income Tax Business Application (ITBA) is the flagship project of the Department for automating all the processes of the Department in the foreseeable future.
  • OLTAS project integrates online tax payments made by tax payers with the running ledger accounts of tax payers maintained by the income tax department for tax credit.
  • The Centralized Processing Cell for Tax Deduction at source (CPC-TDS) is a technology driven initiative of the Income Tax Department.
  • To facilitate the taxpayers and to provide end-to-end e-enabled services, a system of electronic verification of return of income has been launched by CBDT.
  • “E-Sahyog” pilot project was launched as an online mechanism to resolve mismatches in income-tax return through end to end e-service obviating the need to visit income-tax office by the taxpayer.

Minimum Government Maximum Governance:

  • A committee under Justice (Retd.) R.V. Easwar has been constituted to recommend measures for simplification of the Income-tax Act, 1961.
  • The Government has accepted the report of Justice A.P. Shah Committee that Minimum Alternate Tax (MAT).
  • Simplification of procedures was made for submission of Form No 15G and Form No 15H.
  • Notification made of Income Computation and Disclosures Standards (ICDS) under section 145(2) of the Income Tax Act.

Reference:

http://pib.nic.in/newsite/PrintRelease.aspx?relid=133422