New Delhi The Select Committee of the Rajya Sabha on the Goods and Services Tax Bill has advised changes in provisions relating to compensation for states and on levy of one percent additional tax by states on the inter-state supply of goods.
The suggestions were made on Wednesday as the committee submitted its report to the Rajya Sabha, the upper house of parliament. The report, which by majority endorsed almost all the GST bill provisions is, however, marked by dissent notes from the Congress, AIADMK and Left parties.
According to the committee, the provision in the bill provides that the central government “may” compensate states for a period up to five years for any revenue loss. The report has suggested this be substituted with a commitment to compensate for five years.
In case of the provision for levying 1 percent additional tax by states to cover their losses due to abolition of local levies, owing to implementation of GST, the committee has suggested the levy should only apply to “all forms of supply made for a consideration”.
According to the bill, when goods move from one state to another, an additional one percent tax would be levied, but the opposition said it would lead to a cascading effect.
The committee, headed by BJP leader Bhupendra Yadav, however, retained the representation of the Centre and states in the GST Council at the proposed level at one-third and two-thirds, despite demands to reduce the centre’s representation to one-fourth.
“Administratively, we are taking all steps for both the Centre and states to meet the April 2016 deadline,” Revenue Secretary Shaktikanta Das told reporters here.
The union government has set the target to reform India’s indirect tax regime from April next year, and had earlier proposed 100 percent compensation to states for first three years.
The GST is seen as the key to facilitate industrial growth and improve the country’s business climate.
By subsuming most indirect taxes levied by the central and state governments, such as excise duty, service tax, VAT and sales tax, the new regime proposes to facilitate a common market across the country, leading to economies of scale and reducing inflation through an efficient supply chain.
The passage of the bill to become a law is a lengthy process.
Being a constitution amendment bill, passed by the Lok Sabha, it needs to be passed by the Rajya Sabha with a two-thirds majority and then be ratified by at least 15 state legislatures before being sent to the President for his assent.
A leader of India’s ruling Bharatiya Janata Party (BJP) has announced that he would pay a reward roughly equivalent to $1.5 million to anyone who would behead an Indian actress and a film director.
Surajpal Singh Amu, a member of the BJP in northern Haryana state, is apparently upset about an upcoming movie, Padmavati, starring actress Deepika Padukone as the 14th-century Hindu queen Padmini.
The movie is directed by Sanjay Leela Bhansali.
Amu alleged that the movie is misleading, not based on truth and offends Hindu sentiments in the country.
“We will reward the ones beheading them, with 10 crore rupees, and also take care of their family’s needs,” Amu said in an interview with India’s Asia’s Premier News (ANI) earlier this week.
Threats against movie
Amu also vowed not to allow the release of the movie and warned movie theaters to avoid playing the movie or risk being torched.
The movie was set to be released during the first week of December.
Rights activists have reacted strongly to the threats and urged the government to take action.
“This is pretty outrageous that you announce publicly and no action takes place at a time when people are being arrested for most trivial reasons in this country,” Gotum Naulakha, an Indian-based civil liberties activist, told VOA.
An official complaint has been registered against Amu, but many are criticizing the stance of the ruling Bharatiya Janata Party — which controls the central government led by Prime Minister Narendra Modi — on the matter.
“I’ve not heard any official stance from the central government or the Ministry of Information and Broadcasting,” Vinod Sharma, an Indian-based analyst, told VOA.
Anil Jain, a local BJP spokesperson, told ANI that the law applies to everyone in the state of Haryana and no one can threaten others. The central government has yet to react, however.
Bollywood actress Padukone stood her ground and said the movie would be released despite the threats.
“Where have we reached as a nation? We have regressed. The only people we are answerable to is the censor board, and I know and I believe that nothing can stop the release of this film,” Padukone told Indo-Asian News Service (IANS) last week.
Padmavati was controversial right from the start. Opponents of the movie stormed the filming of one scene and destroyed the film sets. They were upset that the director of the movie was distorting facts by alleging romance between the Hindu queen and the Muslim invader Alauddin Khilji.
Film director Bhansali, however, denies the allegations and maintains the story is based on a Sufi and medieval-era poem written about the Hindu queen. In the poem, the Hindu queen chooses death before the Muslim conqueror could capture her.
Some experts say the poem is centuries old and there is a possibility the Hindu queen might be purely a fictional character found only in folklore.
“There’s a lot of debate in India whether Padmavati was actually a living being many, many years ago or whether she was just an imagined person in a poem,” analyst Sharma said.
Rights activists maintain that if government fails to draw clear lines around the threat made by the politician, and discourage a growing sense of impunity for some, incidents like this will only increase and threaten the freedom of expression in the world’s biggest democracy.
“By letting loose and giving [a] sense of impunity to the goons of the ruling party or people who’re connected or close to the ruling party, we’re paving the ground for much bigger and [worse] things to happen in the near future,” Naulakha told VOA.
The movie is awaiting approval from India’s Central Board of Film Certification.
• Illegal liquor licenses granted in shopping malls
• Swaraj India protests against illegal vends at Cross River Mall
• Illegal vends have turned the mall into a liquor den
• Liquor license scam, a perfect example of unholy collusion between AAP & BJP
• Arvind Kejriwal, who came to power on the promise of making Delhi addiction free, has today become the Badal of Delhi and Manish Sisodia another Majithia.
New Delhi, Nov 5: Newly formed political party, the Swaraj India has exposed a major scandal in the distribution of liquor licenses by the Delhi government. Party’s Chief National Spokesperson and Delhi State President, Anupam, said that the Delhi government is illegally distributing L10 category liquor licenses enabling dealers to open vends in shopping malls of the city.
The Delhi government offers licenses in the L-10 category to liquor vends in shopping malls of the city. Definition of shops operating from within a mall is clearly stated in the law and the rule mandates that all shops operating from within a mall should be opening up within the building only and cannot have an entrance towards the exterior side of the mall. But Delhi government and the mall management have created these liquor shops against the approved map of the mall. Every week, the Excise officials of Delhi Government are supposed to inspect liquor vends existing in the city, but not a single objection has been raised against these vends that are blatantly violating rules every single day.
And this has resulted in around a dozen liquor vends springing up in just the ground floor of the Cross River Mall. This has turned the shopping mall into a den of liquor vends leaving people living in nearby residential areas helpless. Neither the Delhi government nor the MCD and nor the Delhi police are even taking note of this broad daylight scam. “Is this not a direct sign that all the levels of the government and administration are complicit in letting this illegal trade grow?” Anupam asked.
Everyone in Delhi is well aware of how the employees of MCD don’t lose a moment to demand their share when any construction work begins anywhere. But when illegal constructions are done at such a large scale in a big mall, the MCD doesn’t even blink an eye.
Cross River mall is located in an area from where the Councillor, the MLA as well as the MP are from the BJP. The illegal license is being granted by AAP led Delhi government. It is surprising to see such a harmonious blend between the Aam Aadmi Party and BJP. Promoting liquor trade in Delhi seems to be such a profitable business for both the BJP as well as the AAP that it has brought together the two parties that are otherwise always at loggerheads. Are the black transactions involved in such liquor business the real reason why not a single question has yet been raised by anyone or any party?
Earlier in the last, the Delhi government has eased rules for granting the license to new liquor vends by reducing the minimum carpet area required from 1000 to 500 square feet. And now, in clear dereliction of rules, even vends are being run in the shopping malls.
On Sunday, Swaraj India’s Mahila Swaraj Morcha protested against the numerous liquor vends in Cross River Mall of Delhi and demanded that the liquor shops be closed down. And in this mall in Shahdara, around a dozen liquor shops have been opened up by granting illegal licenses of the L10 category. And outside this mall, that has been turned into a den of liquor vends, a crowd of drunkards creating an atmosphere of hooliganism has become a daily affair. There has been a continuous increase in crime in the drunken state, where eve-teasing & snatching have become a regular affair.
Sarvesh Verma, President of the party’s Mahila Morcha, said that Arvind Kejriwal who rode to power on the promise of making Delhi an addiction-free city has today become the Badal of Delhi with Sisodia as another Majithia.
Anupam said that though the Delhi government’s anti-women policies will result in the promotion of alcohol addiction but Swaraj India will not let these nefarious plans succeed. The party has earlier as well launched mass agitations against the granting of liquor licenses in residential areas of Delhi, because of which the Delhi government was compelled to announce a ban on the distribution of new licenses. If the government does not immediately order an investigation into the illegal L10 vends and stop this unholy collusion, the Mahila Swaraj Morcha of Swaraj India will take this agitation ahead for the betterment of Delhi.
New Delhi, October 4: Though the government’s radical measure of demonetisation has disrupted the economy and has hit the real estate sector — already reeling under prolonged slowdown — it will turn out to be a blessing in disguise in the medium-to-long term.
As an asset class, real estate has been a big source of generating and consuming black money. The cash component in real estate has been there at various levels, beginning with land transactions where it amounts to 30-50 per cent. The cash payout is quite high in luxury housing too. The consumption of cash has been as high as 30 per cent in secondary market transactions.
The primary market transactions, however, are by far bereft of cash component as home purchases are financed through loans from banks and housing finance corporations. It is another matter that even in primary market deals, developers have been encouraging cash payouts by luring property buyers with good discounts on property price.
The speculative buying by investors through offerings like underwriting and pre-launches has also been involving cash payout, leading to artificial price hike and in turn making homes out of the reach of masses.
Demonetisation, coupled with the government’s move to check benami transactions through legislation and curbs on cash transactions, was meant to clean up the system.
This sudden ‘shake up’ was, however, not without its adverse impacts. Demonetisation badly affected the liquidity in the capital-intensive real estate sector, deepening the problem of massive fund shortage/cash crunch faced by developers reeling under delayed deliveries, which deterred buyers from purchasing property.
The impact was more evident in markets like NCR and Mumbai which were largely investor-driven, compared to southern markets of Bengaluru and Chennai and even Pune in the west, which have been end-user driven. The premium/luxury residential segment, in which the cash component was more in transactions, got impacted by demonetisation.
Real estate experts’ belief that the impact of demonetisation is only short-term and will not have long-term impact, stems from the fact that developers who have been following transparent and fair practices have not been affected by demonetisation and instead it worked out to their advantage.
This also turned out to be a positive development for big global real estate consultants like JLL India which doubled its profits in 2016 over 2014-15, with 60 per cent revenue growth.
One key positive impact of demonetisation and RERA (Real Estate Regulation Act) has been that speculative investors deserted real estate and end-users/genuine buyers, who were all these years pushed to the sidelines, came out in large numbers. Now, it is the property consumers who are driving the real estate market, especially residential market, aided by the government’s pro-industry and pro-consumer initiatives.
The step to promote affordable housing and according real estate industry status for the purpose of making easy and cheap funds available to the sector also helps.
Demonetisation has particularly boosted foreign funding. The transparency brought in by demonetisation, aided by RERA, GST reforms and liberalisation of FDI norms, has boosted the confidence of foreign investors, which is clearly evident from the spurt in foreign investments, particularly from pension funds.
This will inject much needed liquidity in the sector starved of funds. Targeting consumers, the government under the Pradhan Mantri Awas Yojana (PMAY), is providing substantial interest subsidy to home buyers. The clampdown on floating cash in the system has contributed significantly to curbing inflation which, in turn, helped RBI in cutting interest rates, thereby boosting home buying.
The proposed measures to liberalise FSI norms and rationalise stamp duty, will give further fillip to the residential sector, particularly affordable housing.
Demonetisation had a salutary impact on property prices by curbing cash transactions and checking speculative pricing, in turn increasing affordability, which is a key to achieve the government’s flagship mission of ‘Housing for All’. RERA & GST are further aiding demonetisation to control prices.
The key provisions in RERA, to speed up project completion, by checking diversion of funds through mandatory escrow account, stringent penalties to check project delays, together with the government’s move to make all building sanctions online, will go a long way in checking time and cost overruns of real estate projects, thereby controlling home prices.
The ban on pre-launching of projects under RERA will also check artificial spurt in pricing. GST has come to tackle the flow of cash in the purchase of building materials by introducing input credit tax. Further, the government’s plans to liberalise FSI norms, especially for affordable homes, and rationalising stamp duty will have a sobering effect on property prices.
But for some little lingering effect, economists and real estate experts believe that the overall downside impact of demonetisation has faded and its impact is not going to be there in the next quarter.
Says Ashwinder Singh, formerly CEO of JLL India & now CEO of leading real estate consultancy, Anarock Consultants: “Other than in terms of the initial confusion-induced decline in sentiment, the trend that is emerging now, points towards a recovery in buying sentiment with serious buyers already returning to primary markets.”
The entire demonetisation exercise undertaken by the government and aided by other reforms, like Benami Property Act, RERA and GST, is to be looked at in the backdrop of the government’s multi-pronged policy to create institutional and regulatory framework for speedy and steady growth of the economy. And at the centre of all these initiatives is real estate, which is a key contributor to GDP. Going forward, these policy initiatives will help make real estate more organised, transparent, credible and affordable, making the sector investor and consumer friendly. (IANS)