QBiz: GST Council Lowers Tax Rates; FinMin Slashes Corporate Tax

Here is a round-up of the top business stories.

1. India INC Gets Its Mojo Back

In a bold move to reverse the economic downturn and make India an attractive investment destination, finance minister Nirmala Sitharaman on Friday slashed corporate tax rates worth Rs 1.45 trillion paid by domestic manufacturers, making the country one of the lowest tax regimes in Asia.

Manufacturing companies not availing of tax sops can now opt for a 22% corporate tax rate, while new manufacturing companies that register and start production between 1 October and March 2023 can avail an even lower tax rate of 15%.

(Source: Livemint)

2. GST Council Meet Key Takeaways: Tax Sops for Hospitality Industry

After hours of deliberation, the GST Council on Friday announced rate cut on a number of items, amid a chorus of demands for measures to address the slowing economy. All GST rates will be effective from October 1, Finance Minister Nirmala Sitharaman said.

Taxation simplifications and rationalisation of tax rules governed the GST council meet on Friday, Sitharaman said.

The panel, comprising state finance ministers and the union finance minister as the chair, was expected to cut tax on 20-25 products.

(Source: The Economic Times)

3. Failed ATM Services: RBI Tightens Norms for Banks, up Penalties

The Reserve Bank Friday prescribed a turnaround time (TAT) for banks to settle failed transactions for customers and also notified compensations payable for various types of customer complaints.

The financial compensation should be done suo motu by the bank, without waiting for a complaint or a claim by a customer, the RBI said.

(Source: Livemint)

4. Improve Revenue Buoyancy, Finance Commission Chairman Asks States

Fifteenth Finance Commission (FFC) Chairman N K Singh on Friday asked states to consider restructuring goods and services tax (GST) compensation, amid growing concerns over the Centre’s revenue collection. States were told to explore ways to shore up revenues and recommended considering hiking rates on certain items. Singh is also learnt to have asked states whether the current revenue assumption of 14 per cent growth in compensation from the Centre was unrealistically high.

GST collection has significantly slowed down in recent months, making it difficult for the Centre to hand out compensation to states.

(Source: Business Standard)

5. ED Finds Gaps in State Bank of India Audit of Grounded Jet Airways

The Enforcement Directorate (ED) has raised objections against the State Bank of India-commissioned audit of Jet Airways books because its own probe findings in the case are significantly different. SBI, which led the lenders’ consortium for Jet, had appointed accounting firm EY last year to do an audit of the airline amid fund diversion allegations.

The bank closed the forensic audit in April because it found the cash-strapped airline’s response adequate on the findings.

(Source: Business Standard)

6. Shaktikanta Das Says GDP Growth Expected to Be Better in September Quarter

Reserve Bank of India Governor Shaktikanta Das said on Friday that with the government spending gaining momentum, economic growth is expected to be better in the second quarter of the current financial year. The comments from the RBI Governor come on a day Finance Minister Nirmala Sitharaman announced a reduction in corporate tax rates in a big boost to companies, and said that the latest measures will cost the government Rs. 1.45 lakh crore in revenue.

"From the second quarter government expenditure has been picked up. So second quarter numbers will be hopefully better than the first quarter," Mr Das said.

(Source: NDTV)

7. Goyal Bats for PSUs, Says Private Sector is Full of Scandals

Union minister Piyush Goyal Friday batted for continued government ownership in banks and other key industrial areas saying privatisation is not the panacea for all the ills facing the economy as the private sector is plagued with more scandals than their state-run peers.

Chairing a panel discussion at an India Today event here this evening, he said, "there are more scandals in private banks today than we have in public sector banks.

(Source: Livemint)

8. Revival in Auto Sector May Be Round the Corner With the Corporate Tax Cuts

The prices of two- and four-wheelers manufactured by profitable automakers are likely to come down significantly following the corporate tax cut announced on Friday, just in time for the Navratri and Diwali festivals.

The automobile component manufacturing sector, which has been the worst hit by the yearlong downturn in sales, will also benefit from the move.

(Source: Livemint)

9. Banks' Credit Must Grow 12% to Meet $5 Trillion Economy Target: SBI

The credit from banks must grow by 12 per cent every year to meet the Centre's target to achieve a $5-trillion economy within the next five years and the step taken for mergers of the PSBs is in the right direction to meet the goal, a top SBI official said Friday.

Supporting the move to merge the public sector banks(PSBs) by the Union Finance Ministry, State Bank of India (SBI) MD Dinesh Kumar Khara said that the merger is "well-thought of" and will strengthen the banking system to support the economy to pursue $5-trillion target.

(Source: NDTV)