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Tag: Central Board of Indirect Taxes and Customs

  • Data gathering by public businesses picks up at the same time as regulation hangs hearth

    The customs division mandating airways to share private particulars of worldwide flyers, the Civil Aviation Ministry’s facial recognition system DigiYatra, the MeitY’s proposal to share non-personal information collected by the federal government with start-ups and researchers, CERT-In’s mandate asking digital personal community (VPN) service suppliers to retailer information of their customers: these are amongst a rising variety of strikes made by the Central authorities and its businesses to gather and course of residents’ information — all within the absence of a knowledge safety regulation.

    Experts have raised issues over this development, questioning the federal government’s efforts of knowledge assortment and monetisation within the absence of a fundamental information safety regime. Earlier this month, the Centre withdrew the Data Protection Bill, 2021, saying that it’ll quickly come out with a “comprehensive legal framework” for the web ecosystem.

    The Bill, greater than 4 years within the works, had gone via a number of iterations, together with a assessment by a Joint Parliamentary Committee. While it had important exemptions for the Centre and its businesses, it laid down a framework for consent-related mechanisms earlier than gathering information, how private information was purported to be dealt with by numerous entities, and offered for a recourse mechanism in case an individual’s information was compromised.

    In the backdrop of the Bill’s withdrawal, to this point this yr, various Central authorities establishments and its associated entities — starting from the Ministry of Electronics and Information Technology (MeitY), the Central Board of Indirect Taxes and Customs (CBIC), the Civil Aviation Ministry, cybersecurity regulator CERT-In, and the Indian Railway Catering and Tourism Corporation (IRCTC) amongst others — have all both launched new varieties of information assortment or monetisation plans. While a few of them finally relented below criticism and withdrew their proposals, the preliminary efforts and the underlying thought of monetisation are simple, specialists contend.

    Last month, IRCTC launched a young detailing its plans to monetise its financial institution of passenger information for doing enterprise with authorities and personal entities. According to the tender, buyer information that would probably be monetised contains passengers’ title, age, cellular quantity, gender, electronic mail handle, cost mode, “login/password”, amongst different issues. However, final Friday, the corporate withdrew the tender given the absence of a knowledge safety regulation within the nation.

    In February, the MeitY had floated a draft India Data Accessibility and Use Policy which proposed that information collected by the Centre that has “undergone value addition” could be offered within the open marketplace for an “appropriate price”. This draft was withdrawn after it confronted extreme criticism over its proposal to monetise authorities information and the MeitY has now come out with a draft information governance framework which seems to be to leverage non-personal, that’s information that may not establish people, as a substitute.

    Experts imagine that there’s a basic concern in treating residents’ information as a “wealth resource”.

    “There is a fundamental issue with our approach of trying to treat data as a ‘sovereign wealth resource’ which then creates incentives for attempts to accumulate, and subsequently monetise large volumes of data. Until this lens persists, we can expect more efforts to monetise citizens’ data even without any additional safeguards,” mentioned Prateek Waghre, coverage director at Delhi-based digital rights group Internet Freedom Foundation.

    “The authorities’s major concern must be service supply and safeguarding the data it gathers from residents in the direction of this finish. Its key goal shouldn’t be to monetise this information for revenue.

    “The 2018-2019 Economic Survey of India referred to data as a ‘public good’. By definition, that means it should be treated as ‘non-excludable and non-rivalrous public good’ and not traded as if it were a commodity,” he added.

    Within the Centre, there are previous precedents of scrapping an energetic coverage that monetised residents information, over privateness issues.

    The Ministry of Road Transport, in 2020, had scrapped its Bulk Data Sharing Policy, below which the ministry used to promote automobile registration information (Vahan) and driving licence information (Sarathi) to non-public and public entities. The coverage was scrapped over potential misuse of private info and privateness points.

    Aside from monetisation, the Centre has additionally upped the ante on mandating entities to gather new varieties of citizen information and, in some circumstances, share it with the federal government.

    With its new Passenger Name Record Information Regulations, 2022, issued earlier this month, the CBIC has requested airways to mandatorily share PNR (passenger title document) particulars of all worldwide passengers with the National Customs Targeting Centre-Passenger, 24 hours previous to departure of flights.

    Aimed at “risk assessment”, the information to be shared contains title of the passenger; date of meant journey; all obtainable contact particulars; all obtainable cost or billing info corresponding to bank card numbers; journey standing of the passenger, together with affirmation and check-in standing; baggage info; seat info; and journey company or agent from the place the ticket was issued. While the notification says that the information will likely be topic to “strict informational privateness, it is going to be saved for a interval of 5 years.

    There are extra cases of knowledge assortment taking place within the aviation sector — below the Civil Aviation Ministry’s DigiYatra initiative, facial recognition know-how and scanners will likely be used at numerous airport checkpoints like safety and boarding to determine the identification of passengers. Earlier this month, the Delhi International Airport soft-launched the initiative, rolling out the beta model of its app for Android platforms. The coverage outlining how the initiative will likely be carried out states that the facial scanner can have the flexibility to alter information purge settings primarily based on “security requirements” and safety and authorities businesses could possibly be given entry to passengers’ facial information.

    In April, the Indian Computer Emergency Response Team (CERT-In) launched a set of cybersecurity tips which mandated VPNs, cloud service suppliers and information centres to retailer person info like their IP handle, electronic mail, handle, and get in touch with numbers amongst others. These are information factors which may probably be accessed by the company in case an entity faces a cybersecurity incident.

    In December 2021, the Department of Telecommunications (DoT) had amended the Unified Licence Agreement asking telecom operators and web service suppliers in addition to all different telecom licensees to keep up industrial and name element data for no less than two years, as a substitute of the then present one-year observe. DoT sources had earlier informed this newspaper that the modification was primarily based on requests from a number of safety businesses.

    Queries despatched to IRCTC, MeitY, CBIC, CERT-In, Civil Aviation Ministry, and DoT didn’t elicit a response till press time.

    Before all this, in 2020, the federal government had launched the contact tracing app Aarogya Setu — which was downloaded by hundreds of thousands of Indians on the top of the coronavirus pandemic — and picked up information like their names, cellphone numbers and placement. In its early days, the app was essential for accessing various providers together with flights, till the Karnataka High Court in October 2020 ordered that the app can’t be made obligatory. The app had additionally triggered privacy-related issues, provided that it had entry to individuals’s private information, and in response, the federal government had launched a knowledge sharing protocol for the app. And now, because the app heads in the direction of turning into a well being app of types, the protocol has expired, a proper to info request by IFF revealed.

    All these developments comes as India continues to lack a fundamental information safety laws. However, authorities sources have mentioned that the brand new Bill will incorporate the broader concepts of knowledge safety as beneficial by the Joint Parliamentary Committee and will likely be consistent with the Supreme Court’s landmark judgement of 2017 whereby it held privateness as a basic proper.

  • Customs Act offences: Guidelines for authorized proceedings revised

    Hiking the financial threshold for prosecution and arrest, the Central Board of Indirect Taxes and Customs (CBIC) has issued revised pointers for prosecution, arrest and bail for offences underneath the Customs Act.

    The pointers, dated August 16, specify that Rs 50 lakh can be the financial threshold in case of luggage and outright smuggling, whereas it will likely be Rs 2 crore for industrial fraud. The earlier thresholds have been Rs 20 lakh and Rs 1 crore, respectively.

    While the Act doesn’t specify any worth limits for exercising the powers of arrest, it’s clarified that arrest in respect of an offence, must be effected solely in “exceptional situations”, the CBIC stated. Specifying such distinctive conditions, the CBIC stated they embody circumstances involving unauthorised importation in baggage/circumstances underneath Transfer of Residence Rules, the place the market worth of the products is Rs 50 lakh or extra or circumstances of outright smuggling of excessive worth items corresponding to valuable metallic, restricted gadgets or prohibited gadgets or items or offence involving overseas forex the place the worth of offending items is Rs 50 lakh or extra.

    Further, circumstances associated to importation of commerce items (i.e. appraising circumstances) involving wilful mis-declaration in description of products/concealment of products, or import of restricted or prohibited gadgets the place the market worth of the offending items is Rs 2 crore or extra would entice arrest underneath customs act. Cases involving fraudulent responsibility evasion of Rs 2 crore or extra too entice arrest provision.

    Saurabh Agarwal, tax associate, EY, stated, “This move will help in reducing litigation and bringing in better clarity for both importers & the customs department.”

    Abhishek Jain, associate—oblique tax, KPMG in India, stated in an efficient justice system, prosecution and arrest must be initiated solely in conditions involving substantial responsibility evasion. “Pursuant to the revised monetary limits being prescribed by the government, going forward, while the civil proceedings would continue for duty, interest and penalty recovery, prosecution and arrest would be initiated in cases where the financial severity is high,” Jain stated.

  • GST’s half-a-decade journey: Tech utilization to plug income leaks, Rs 1.3 lakh cr month-to-month tax ‘new normal’

    India’s greatest tax reform, the Goods and Services Tax (GST), completes its half-a-decade journey on June 30, with many hits and a few misses, and likewise caused a paradigm shift in use of know-how to result in tax compliance and making over Rs 1 lakh crore income assortment each month ‘a new normal’.

    A nationwide Goods and Services Tax (GST), which subsumed 17 native levies like excise obligation, service tax and VAT and 13 cesses, was rolled out on the stroke of midnight on July 1, 2017.

    Under GST, a four-rate construction that exempts or imposes a low price of tax of 5 p.c on important objects and high price of 28 p.c on vehicles is levied. The different slabs of tax are 12 and 18 p.c. In the pre-GST period, the overall of VAT, excise, CST and their cascading impact led to 31 p.c as tax payable, on a mean, for a client.

    Besides, there’s a particular 3 p.c price for gold, jewelry and treasured stones and 1.5 p.c on reduce and polished diamonds.

    Besides, a cess is levied on the very best tax slab of 28 p.c on luxurious, sin and demerit items. The assortment from the cess goes to a separate corpus — Compensation fund — which is used to make up for income loss suffered by the state resulting from GST rollout.

    GST additionally represents an unprecedented train in fiscal federalism because the Centre and states come collectively within the GST Council to thrash out modalities for easy functioning of the comparatively new tax regime.

    The Council has met 47 occasions up to now and have taken measures which made Rs 1 lakh crore GST assortment per thirty days ‘a new normal’ and on target to take the determine to Rs 1.4 lakh crore each month.

    As the federal government releases the June GST assortment numbers on July 1, it’s extensively anticipated that the collections will observe the previous 4 months’ pattern and be round Rs 1.4 lakh crore.

    The collections had touched a file Rs 1.68 lakh crore in April 2022, it had for the primary time crossed Rs 1 lakh crore mark in collections in April, 2018.

    On the fifth anniversary of GST, Central Board of Indirect Taxes and Customs (CBIC) tweeted “GST subsumed multiple levies and cesses, reduced compliance burden, removed regional imbalances and inter-state barriers, and significantly increased the transparency and overall Revenue collection”.

    Over the previous years the Government has been proactively issuing circulars and clarifications to clear doubts concerning taxation beneath GST and guarantee ease of doing enterprise.

    More lately, the GST Council, in its forty seventh assembly in Chandigarh, has determined to ease compliance for small taxpayers who provide via the e-commerce platform.

    Such suppliers, who make solely intra-state provides, needn’t search GST registration if their annual turnover is lower than Rs 40 lakh in case of products and Rs 20 lakh in case of provides.

    To assist tax officers in administration, GST Network, which offers the technological spine for the oblique tax regime, has been utilizing synthetic intelligence and machine studying to dish out newer information and plug income leakages.

    Tax consultants, nevertheless, search an easier construction for Goods and Services Tax, a construction which might guarantee seamless movement of enter tax credit score via the complete provide chain with out losses.

    BDO India Partner and Leader – Indirect Tax Gunjan Prabhakaran mentioned “over the previous 5 years, the GST legislation has developed and mitigated a number of points confronted by the taxpayers via well timed clarifications and amendments.

    “However, the GST Council and the Government should quickly address few other hardships faced by taxpayers in relation to unwarranted and excessive issuance of show cause notices (for reconciliations of financial numbers, grant of registration, etc) and introduce a robust, technology driven single assessment process, which would achieve the twin objective of ease of doing business and remove the cascading effect of taxes”.

    AMRG & Associates Senior Partner Rajat Mohan mentioned within the final 5 years, GST legislation has matured at a quick tempo. First, the main focus was on compliance and know-how; ahead of later, it moved gears, and taxpayers have been posed to self-regulate the annual filings.

    “Now it seems the law has entered the next phase whereby litigation needs to be reduced by either replacing ambiguous tax laws or clarifying the practical application of technical issues. Businesses expect the government to resolve all sectoral issues like would BPO/KPO qualify as an intermediary, tax credit for capital expenditure on building, levy of GST on Extra Neutral alcohol (ENA) etc,” Mohan mentioned.

    While the GST administration has moved ahead with alacrity, it’s nonetheless an extended strategy to go to realize the complete potential of GST and make it a real ‘good and simple tax’.

    With petrol, diesel, ATF exterior GST, a big a part of the economic system remains to be not lined by the oblique tax regime. Inclusion of petroleum merchandise beneath the GST web, might scale back value for firms, tax consultants say.

    With rising know-how, there may be emergence of newer asset lessons just like the digital digital property (VDA) or cryptocurrency.

    There is a necessity for readability on whether or not they could be categorized as provide of ‘goods’ or ‘services’ and what could be the tax price on them.

    Tax price rationalisation is one thing which might occur eventually.

    Current inflationary issues could have derailed the plans to tweak charges and GST slabs, however it might ultimately be a actuality as each the Centre and states want revenues and lesser slabs would imply a simplified tax regime.

    Besides, the choice makers within the Council too must work out an answer as state governments, from July 1, 2022, stare at a stoppage of compensation for income loss resulting from GST implementation.

    When GST was rolled out on July 1, 2017, states have been promised a compensation, from the cess fund, for 5 years if their GST assortment falls wanting the 14 p.c compounded income development.

    Most states have sought an extension to the compensation mechanism and a last resolution is more likely to be taken on the subsequent GST Council assembly in Madurai within the first week of August.

    Abhishek Jain, Partner Indirect Tax, KPMG in India, mentioned going ahead, the Government can take into account organising of Central authority to resolve conflicting AAR judgements throughout states and take into account putting off anti-profiteering provisions releasing companies to set costs.

    “Further, bringing petroleum and electricity under GST ambit will help prevent cascading and ensure further uniformity. Lastly, some checks can also be incorporated on system generated GST notices, so as to avoid any unnecessary harassment of taxpayers,” Jain mentioned.

  • ‘ITC enabling provision to help catch fake dealers; process to be centralised’

    THE BUDGET has launched provisions for enabling restriction of pretend enter tax credit score (ITC) and it’ll assist catch these faux sellers who had been displaying a sudden spike of their provides and never paying the corresponding tax, Central Board of Indirect Taxes and Customs (CBIC) Chairman VIVEK JOHRI stated. In an interview with AANCHAL MAGAZINE, Johri stated fee rationalisation beneath GST will occur in phases because it can’t be very disruptive to income. Edited excerpts:
    Some enabling provisions about ITC beneath GST have been put within the Budget. Will it’s one thing that can have an effect on sincere taxpayers additionally?
    The vital goal of bringing on this provision, which talks about limiting ITC, is to make sure that a brand new taxpayer who has entered the system is just not capable of abruptly generate a lot of invoices for passing on ITC. We observed that previously, based mostly on our investigation into faux sellers and pretend ITC, there was one frequent trait – many of those large sellers didn’t have any revenue tax footprint, they’d no background in coping with items and companies and so they had been getting into the system. They would subject invoices of huge quantities, present a sudden spike of their output provides, not pay the tax comparable to these provides and, then, depart the system in two or three months’ time. So, we wish to have the power to determine such taxpayers, in order that in a centralised manner, with out leaving discretion within the fingers of the officer within the discipline, we’re capable of, then, say that solely a lot of the credit score be allowed within the first month; that isn’t to say that remainder of the credit score won’t ever be out there. Depending on his behaviour, we launch the remainder of the credit score, however the sole goal of getting this enabling provision is to take care of the scenario.
    The GST collections appear to have stabilised across the Rs 1.4-lakh-crore degree. The preliminary concept was to have the system mechanically detect leakages. How is it now?
    E-invoice is unquestionably serving to and we’re happening reducing the brink … The concept is that we should always be capable to universalise it for all invoices. You have invoices on the system, you could have e-way payments for items. To a big extent, you’re capable of take care of the issue of pretend invoices for items. But individuals have develop into smarter, we discover that they’re issuing faux invoices for companies additionally, and in contrast to items the place it’s nonetheless potential to trace the motion of products, in companies even that isn’t potential. So, that’s why the try is to have one supply of reality within the system, which would be the bill that we’ll try to we’ll use to assemble the GSTR-1 of all GST sellers and the GSTR-1 then auto populates the GSTR-3B. So, there’s a self checking mechanism inside the system.

    We’ve additionally tried to make checks extra rigorous on the entry level. For the registration course of, we launched Aadhaar authentication and bodily verification. The entire goal of that isn’t to harass the dealer, however to be sure that the taxpayer who’s coming in is duly recognized. It’s not a bogus entity, it’s not a benami entity. Then, after the taxpayer is within the system, we’re capable of watch his behaviour. Based on the info that we gather from these sources, we’re operating analytics on all of them. We additionally do knowledge triangulation, with different businesses, revenue tax, Customs, for instance, MCA that additionally provides us some extra clues about what’s the background. That is how we intend to proceed.
    Is textiles going to be the rapid focus for fee rationalisation beneath GST or will there be different objects? Will gas, particularly ATF, be included beneath GST?
    I’m not aware of what the GoM is desirous to proceed, however my restricted understanding is that it’s not confined to textiles. They will have a look at the general fee construction. Some sectors want extra capital…and the necessity for refunds, however, they’ll have a look at the general curiosity. The Finance Minister whereas chatting with the business chambers has stated it (ATF) will likely be taken up on the subsequent GST Council dialogue.

    So, that might imply slab modifications? Or is there a center fee or income impartial fee that’s being checked out?
    I don’t assume they’ve utilized themselves to that. There are varied choices. But clearly, no matter determination they take, it can’t be very disruptive to income as a result of that could be a concern. So, both they part it in or they lay down a trajectory of how we should always do it to get to the golden imply. The inversion factor will get corrected first, then the speed slab modifications, after which, primarily doing it in phases. It must be phased.
    The authorities has not favoured responsibility cuts for Tesla. Is the proposal off the desk?
    I don’t assume it’s truthful to talk about a specific firm’s proposal…however the present fee construction is okay. It doesn’t want any change. At the present fee construction, you could have many different firms coming into the nation, proper? They’re not speaking about rejigging the speed construction, they’re pleased with 15, 30, 60, 100 per cent, proper? Now, they take the decision based mostly on the worth chain. You need to take a name as a enterprise the place you match into that worth … There are firms which can be bringing in components for manufacturing right here. So all of the choices are there. To say that tariff is coming in the way in which of any person investing within the nation, whether or not on the market or for manufacture, I don’t assume is an accurate illustration.

  • Taxmen to provide ‘reasonable time’ to clarify causes for mismatch in GSTR-1, 3B

    Tax officers will give affordable time to erring companies to clarify causes for mismatch in turnover reported in gross sales return GSTR-1 and tax cost kind 3B earlier than initiating restoration motion for brief cost or non-payment of taxes.
    The Central Board of Indirect Taxes and Customs (CBIC) has issued pointers on restoration proceedings and mentioned that taxmen would give a “reasonable time” to companies to clarify the explanations for such mismatch.
    As per the modifications within the GST regulation efficient January 1, GST officers have been allowed to instantly provoke restoration motion towards these errant companies which confirmed increased gross sales in month-to-month return GSTR-1 however under-report it throughout tax cost in GSTR-3B.

    The transfer was aimed toward curbing the observe of pretend billing whereby sellers would present increased gross sales in GSTR-1 to allow a purchaser to say an enter tax credit score (ITC) however report suppressed gross sales in GSTR-3B to decrease GST legal responsibility. with pti

  • Block ITC solely on foundation of ‘material evidence’, CBIC tells GST officers

    The CBIC has launched pointers on blocking of tax credit score by items and providers tax (GST) discipline officers, including such motion needs to be on the idea of ‘material evidence’ and never simply out of ‘suspicion’.
    The norms by the Central Board of Indirect Taxes and Customs (CBIC) lay down 5 particular circumstances during which such credit score could possibly be blocked by a senior tax officer. These embody availment of credit score with out an bill or a legitimate doc, or availing of credit score by purchasers on invoices on which GST has not been paid by sellers.
    The CBIC mentioned the commissioner, or an officer authorised by him, not under the rank of assistant commissioner, should kind an opinion for blocking of ITC solely after “proper application of mind” contemplating all of the details of the case. “It is reiterated that the power of disallowing debit of amount from electronic credit ledger must not be exercised in a mechanical manner and careful examination of all the facts of the case is important to determine cases(s) fit for exercising power under rules 86A,” it mentioned.
    The authorities had launched Rule 86A in GST guidelines in December 2019 giving powers to taxmen to dam the ITC obtainable within the digital credit score ledger of a taxpayer if the officer has “reasons to believe” that the ITC was availed fraudulently.
    Till early final month, taxmen had blocked Rs 14,000 crore price of ITC of 66,000 companies underneath this rule.
    In its pointers dated November 2, the CBIC mentioned the treatment of disallowing debit of quantity from digital credit score ledger being, by its nature, extraordinary, needs to be resorted to with utmost circumspection and with most care and warning. It contemplates an goal willpower based mostly on clever care and analysis as distinguished from a purely subjective consideration of suspicion.
    WITH PTI
     

  • Taxpayers can discharge March GST dues with ITC

    The Finance Ministry stated Satur­day GST taxpayers might use the ITC out there of their credit score ledger to discharge GST dues for March.
    In an announcement, the Central Board of Indirect Taxes and Customs (CBIC) stated, “Taxpayers are free to utilise the Input Tax Credit (ITC) available in their credit ledger, as permissible in law, to discharge their GST dues for the month of March, 2021 — the last month of this financial year.”
    Last month, the Goods and Services Tax (GST) mop-up crossed the Rs 1 lakh crore mark for the fifth month in a row.