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Goods and Services Tax (GST) is ON, replacing almost 20 state and federal taxes. Now, it is going to change the fate of all businesses and lives of every Indian in many ways and some of them in a disruptive way.

1) A transparent tax reform

For the first time, through the form of a single GST rate consumers will have the knowledge of the actual amount of taxes they are paying for goods and services.  The GST rate will be split between central and state governments. Earlier, an invoice included the state-level value added tax (VAT) and in certain cases, the service tax levied by the central government, which excluded taxes on raw materials and services used by various intermediaries.  These taxes were added to the final price of the goods purchased but were not mentioned in the invoice. The efficiency of GST is expected to minimize the tax burden and encourage the transparency.

2) Transition in tax burden

The effort is for keeping the GST rates as close as possible to the existing tax burden on goods and services and to make the transition revenue neutral. Therefore, the effective tax on individual products or goods is expected to move up or down. Tax on services like telecom is expected to go up. However, actual changes will depend on the pricing strategies adopted by the businesses.

3) Unorganized sector at a turning point

Small enterprises with annual sales less than Rs 20 lakh are exempt from the rigors of registering for GST and filing returns. But this exemption poses a risk of larger enterprises turning away from the unorganized sector for sourcing materials and services to larger suppliers that are within the GST system so that taxes paid by their suppliers are available as credit. Small enterprises have to voluntarily sign up for GST to not lose their customers. Larger procurers looking forward to keep ties with the unorganized sector, however, have the choice of paying taxes on their behalf under a system called ‘reverse charge’. Small businesses being a part of the GST system is expected to enhance tax compliance not only of indirect taxes, but also of income tax.

4) Impact on Small and medium enterprises (SMEs)

The tax burden for SMEs is set to go up. With the threshold for GST registration for businesses being much lower at Rs20 lakh annual sales, SMEs will come under GST and have to pay taxes at the federal level too—the central GST. This is expected to double the tax rate for them, although the actual increase in tax burden may not be equally high because of the tax credits passed on to them from their material and service suppliers. GST is devised to broaden the taxpayer base with a vision of minimizing the overall tax rate.

5) No more tax breaks

There is no more excise duty exemption for setting up production units in the north east or hill states. Enterprises will have to make investment decisions based on scale of economy rather than tax arbitrage. This indicates that enterprises will have to set up new production units closer to their market rather than expanding existing facilities in places to leverage on region specific exemption. Units that have already come up with excise exemption for a specified period will have to pay tax first and claim refunds for the remaining period. Mostly the drug makers, automobile producers and cement companies will be affected more as they prefer to set units in hill states earlier.

6) Revamping supply chain

GST will also affect the businesses in terms of its location of warehouses and movement of goods from state to state. As GST is applicable on transfer of stock within a group company’s warehouses in different states, it is expected that businesses may try to optimize their supply chain.

7) Keeping on Right Side of Law

Businesses and traders have to work hard on their pricing strategy during the transition period to avoid getting caught for not passing on any reduction in effective tax burden to the consumer. An anti-profiteering body being set up will keep an eye on how businesses restructure the tax inclusive price charged from consumers.

8) Training vendors, workforce

People in the entire business ecosystem of a company need to be trained. Companies have to not only update their business, accounting and tax payment software, but also train their personnel. Training vendors and business partners is also important as the invoices they file are relevant for the taxes to be paid by a business.

9) Return filing

While suppliers have to upload details of transactions and invoices, the tax return of buyers of goods and services will be auto-generated based on suppliers’ data, minimizing human discretion. Buyers can either accept auto-generated return or modify it.

10) Alcohol and fuel

Alcohol and five fuels including crude oil, petrol, diesel, jet fuel and natural gas are expected to see an increase in tax burden as they continue to remain in the existing tax system, while the GST paid on all equipment and services used in their production become an added cost.

 

 

(A compiled report)

Delhi

Facebook and volunteers of a social organisation helped in uniting an old woman to her family! Kudos

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The social networking site Facebook and whatsapp are extremely significant if used for good and healthy purposes, but has its ugly consequences as well if the users have ill conceived notions and intentions. There are cases of ugly nature happening when people are compelled to watch immoral, obnoxious and uncivilised material and pictures posted intentionally by notorious and disgruntled elements or hackers intruding into accounts of others to derive pivotal informations clandestinely.

But there are intellectuals, social activists, journalists and people with ethics who rightfully use this important via media for exchange of healthy and intellectual views seeking and providing significant information good for one and all. There have been lots of positive incidents that have happened due to facebook like delivering a particular group of blood to the needy, financially helping poor and hapless patients, providing job opportunities to the needy and even helping people and women in distress. This pivotal via media has also helped bringing issues of burning nature to the knowledge of the authorities concerned and simultaneously getting them resolved. Important and sensitive issues such as that of Jessica Lal murder, diabolical murder of Amit Kataria, gang rape and brutal murder of Nirbhaya of Vasant Vihar and Nazafgarh and Kathua rape and horrendous murder of a girl child also acknowledged tremendous momentum nationally through this important social networking sites finally leading to capital punishment to the guilty human beasts and stringent amendments in the laws of the land to severely punish the perpetraters of gruesome crime.

Just two days ago a great job could be executed successfully through the publicity of a missing illeterate old woman of Uttarakhand in Delhi who could finally been restored back to her family. According to BM Upreti of a social organisation of Uttarakhand in Delhi, Uttarakhand Lok Manch an old women probably in her eighties, namely Bhagwati Devi of Kumaon, Uttarakhand who was living in Sagarpur, Delhi for the last two months disappeared after she left the house alongwith her grandson. Since she was illeterate and new in Delhi, was completely unaware about anything, the addressand locality. Not well versed in Hindi she could’nt explain anything about the family and the address.

However, she was left at the Sagarpur, police station by someone. But the police was unable to locate the family as the address and other details of the family was unknown. The volunteers of Uttarakhand Lok Manch Prithvi Rawat and Vijay Gosain put her picture in the Facebook with a message to help locate her family. The message and the picture became viral and finally the Lok Manch’s dedicated team was able to restore the old woman back to her son from the Old Age Home where she was given refuge with the help of police authorities and Uttarakhand Lok Manch. After the ordeal of ten hours and the best possible efforts of the police and volunteers of the Uttarakhand Lok Manch particularly Prithvi Rawat and Vijay Gosain, it was finally the facebook post with the picture of the old woman that she could be united with her son, daughter in law and her grandson who were not only badly worried having searched all the nook and corners of the city but were also apprenhesive of her being met with some accident or UNHONEE.

Thanks Facebook, police and the social organisation Lok Munch and Prithvi Rawat n Vijay Gosain for this marvellous job of reuniting the old woman with her son n family. Let’s imbibe the positive efforts of these young men and help people in distress in future.

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Kairana by poll significant to test BSP, SP’s political clout in UP after victories in Phulpur n Sitapur

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The byelection in Kairana, Uttar Pradesh slated for May 28 is going to be the barometer of the popularity of prime minister Narendra Modi, the BJP as well as the Uttar Pradesh Chief Minister Yogi Aditya Nath. It will on the other hand also test the relevance and significance of the anti BJP opposition front or alliance that is slowly but steadily taking final shape against the BJP and Modi, particularly in view of the 2019 general elections. It’s primarily again a litmus lest for the SP, BSP combine who are outrightly backing the RLD candidate in Kairana after having earlier scored victries in two bye elections

Though the byelections are also being held in Palaghat and two other parliamentary constituencies and 28 assembly seats in other states including Noorpur in UP but Kairana by poll is important because its the parliamentary seat of the largest state which brings 80 MPs in Lok Sabha and several law makers in the upper house and also impacts the national political scenerio of the country.

All would remember that the recent two by poll defeats of the ruling BJP and the victory of BSP supported SP candidates in Phulpur and Sitapur, the home turfs of the UP CM and deputy CM have tremendously denigrated the ruling party’s image and in a way led to the assumption that prime minister Modi and Amit Shah are losing their political clout consistently in view of the anti BJP opposition unity.

The Kairana seat has been vacated by the sitting BJP MP Hukum Singh’s untimely demise which was won by him by a huge margin of over five lakh votes defeating the Lok Dal candidate in 2014 after the riots that polarised the Jat and Gurjar votes to a huge extent.

The Kairana seat however had been the stronghold of the Rashtriya Lok Dal. The BJP has given the ticket to Hukum Singh’s daughter Mriganka Singh to cash on the sympathy vote and a one sided vote bank of the Gurjars who are about one lakh twenty five thiudand in number.

The RLD has allotted ticket to the muslim women candidate banking on the majority minority votes which are more than 5 lakhs, a sizeable chunk to decide the winning chances. Dalits votes too are about two lakhs in numbers and the Jat votes over 1.5 lakhs.

In all, there are 19 lakh votes in this constituency. After the successful example of the one sided victory of SP candidates in Phulpur and Sitapur defeating the BJP in the saffron vote bank turf of Yogi Adityanath, the Congress, BSP and SP have not fielded their candidates but have promised to support the RLD candidate of Choudhary Ajit Singh, who happens to be a women from the minority community.

The BJP is trying to capitalise on the majority vote bank already apprehensive of the minority votes likely to go in favour of Ajit Singh’s RLD candidate, the Dalits too may probably back the RLD in view of the BSP’s support to Chaudhary Ajit Singh.

Congress support may also help to an extent to derive votes of youths and other communities apart from minorities and the Dalits.

Sources reveal that the polarisation trend which helped Hukum Singh of BJP win this seat with a heavy margin in 2014 may perhaps not be the factor this time and the opposition unity minus BJP may work well in favour the the RLD candidate who is already having the advantage of the large chunk of minority vote bank.

The Jats and Gurjars who had inclined towards the BJP in view of the influence of the Hindu Muslim riots and played a pivotal role in the victory of the BJP candidate Hukum Singh may still be there but 25 to 30% of them may tilt this time in the favour of RLD and earlier mentor Ajit Singh whose prestige is actually at stake.

After the formation of the Congress JD(S) combine government in Karnataka and the credible victory in Phulpur and Sitapur by elections, the morale of the anti BJP opposition in the saffron ruled state seemed to be quite high, particularly after the involvement of the ruling BJP MLA in a rape and murder case in Unnao, grave unemployment and existing agrarian crisis in the state compounded with several other factors as the detetiorating law and order situation, false encounters and inflation of essential commodities.

The alleged communal hatred environment in the state and the country has also led to the consolidation of the minority vote bank to a huge extent, who are more than five lakhs and a major factor towards victory are bound to be an asset n a credible winning factor for the RLD candidate Tabbassum.

Since prime minister Narendra Modi usually avoids campaigning in the byelections it may also amount to a big loss to the BJP which is now left with the only alternative to bank on jat leaders like former minister Baliyan and the saffron robed chief minister Yogi Aditya Nath.
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Modi’s charisma and the anti BJP unity ! Which one will fructify ?

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If the prime minister of India Narendra Modi is weighed or compared individually in terms of his charismatic leadership stature and eloquent speeches including his outstanding politcally manipulative abilities no leader, singularly, in the entire opposition leaders’ crowd matches as far as his highly enhanced popularity graph in the country is concerned despite some of the downsliding that has started gaining ground during the last one year.

It’s also a hard fact that prime minister Narendra Modi and the national BJP chief Amit Shah have after assuming power in 2014 over shadowed the entire gamut of party leadership giving an unambiguous impression that it’s only because of former’s political charisma that the BJP has secured power in 20 states of the country including having been credited for being the single largest party in Karnataka as well where Congress and JD(S) rode to power after forming a post poll alliance. As the 2019 general election are approaching near, the over ambitious non BJP opposition leaders are trying to establish the unity in diversity by alligning together undrr the common ideological formula of defeating the communal forces and working out the anti BJP opposition unity on secular credentials.

The recent victories in the Phoolpur, Gorakhpur, Alwar and other byelections in Uttar Pradesh, Rajasthan and Bihar where BJP was defeated badly and the formatin of the government in thesouthern state Karnataka on unity pattern between Congress and JD(S) has transmitted a new lease of life in the entire non BJP opposition parties who are otherwise scattered and see no chance of defeating Modi and BJP in case they do not unite on honest terms giving up their vested squeezed political interests.

The way after 2014’s resounding victory at the centre the charismatic Narendra Modi and subsequent saffronisation factor has resuted in an incessant winning spree in 20 states on the country with being the single largest party in Karnataka the anti BJP opposition had no option but to think earnestly on unity for 2019 and the Congress JD(S) in Karnataka paved the way for them to come together. The historical presence of almost all the anti BJP national and regional opposition parties in Bengaluru , except the conspicuous absence of Navin Patnaik of Orissa and Chandra Shekhar Rao of Telangana has proved beyond doubt that a nationalpolitical alternative is in the making for 2019 that can to a great extent create a dent to the BJP led NDA and if situation warranted even miracles can happen.

The recent prediction of the CSDS and Lokniti Mode of the Nation pre poll analysis also suggests heavy anti incumbency in the BJP ruled states like Rajasthan and Madhya Pradesh going in favour of the Congress and more than half of the country’s minorities and Dalit’s not interested to give Narendra Modi and the ruling party another chance with reduction in 25% Modi fan following as well.

But despite all this prime minister still posseses an edge over his political rivals as a national leader of maximum liking. It’s however a universal fact that every gvernment in ruling invite anti incumbency during the next election but its actually not always as Congress ruled at the centre for ten years before losing power to Modi due to excessive corruption and Shiela Dikshit ruled Delhi for fifteen long years before losing to Arvind Kejrival.

Similarly the CPM ruled Bengal for 34 protracted years and The BJP is ruling in Rajasthan, Madhya Pradesh and Chatisgarh for two three terms incessantly. It has been usually witnessed that after two terms the anti incumbency factor starts working usually.

Political analysts are of the unambiguous opinion that if Narendra Modi is compared individually with any individual leader of the opposition as of now, his stature and popularity stands too above them but if the entire anti BJP opposition transparently and meticulously unites against him and the saffron party at the regional as well as the national level earnestly forgetting their vested and squeezed interests the new anti BJP alliance can be definitely a formidable force posing him a direct credible challenge.

If we go by the performanceof the present regime, broadly speaking on theinflation front, petro products front, employment front, bringing back black money from foreign bank’s front, GDP front, communal harmony front, women safety front, GST n demonetisation front and on the front of over all infrastructural development there have been more dissatisfaction than appreciation though people of the country seem more impressed by BJP on saffronisation and majoritarianism which pays it handsomely in every election.

However, a hard fact also can’t be denied that Mamata Bannerjee of TMC, Mayawati of BSP and Rahul Gandhi of Congress consider them selves as front runners for the prime minister’s post against Narendra Modi. But whether any one of them would click against the politically invincible Modi is anybody’s guess or will the anti BJP opposition parties really unite to fight Modi’s unstopping juggernaut still remains to be seen.

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