FM Jaitley asked to extend cut-off date to deposit banned notes

Washington: Describing the demonetisation move as a "bold decision", a global body for people of Indian-origin has asked Finance Minister Arun Jaitley to extend by six months the cut-off date for depositing the banned notes of Rs 500 and Rs 1,000 denominations.

"It is a bold decision by Prime Minister Modi and we fully support him," said GOPIO president Niraj Baxi in his recent letter to FM Arun Jaitley Jaitley.

The Global Organisation of People of Indian-Origin (GOPIO) in a recent letter said it has been flooded by concerns from a large number of NRIs and PIO after the recent government's decision to ban Rs 500 and Rs 1000 currency notes.

"It is a bold decision by Prime Minister Modi and we fully support him," said GOPIO president Niraj Baxi in his recent letter to Jaitley.

He said that some NRIs and PIOs have left over cash from their previous visits to India, while others have used currency exchanges and banks to obtain the rupees abroad for use on their future trip to India.

Many NRIs and PIOs have kept these notes for a while so as to use them on their return to India in the future. Some have used less time consuming means of obtaining currencies from online money exchanges to take back to India, said a media statement issued by GOPIO.

"NRIs and PIOs should be allowed to exchange whatever amount they have as long as they show the proof of past conversion of foreign currency to Indian currency in the last 10 years," said Thomas Abraham, chairman of GOPIO International.

In the letter, GOPIO requested the Indian Government to extend the cut-off date by six months, as many cannot return to India by the end of December, 2016; and offer PIO's with business and other income in India be similar deals as for residents (deposit up to Rs 2,50,000).

It also urged Jaitley to assist the PIO's living abroad by providing an avenue to cash or exchange the Rs 500 and Rs 1,000 denomination notes held by them for travelling to India and increase the limit for exchange to Rs 25,000 when they arrive at the airports.

In his letter Baxi said as per Government's recent announcement, NRI and PIO'scannot deposit these notes in their foreign banks (as they are refusing to accept them); do not have bank accounts in India to deposit and even if they do they cannot travel to deposit the notes and cannot exchange the notes as foreign banks and exchange outlets are refusing to accept these notes.

PTI

New Rs 100 notes to be issued soon: RBI

Mumbai: The Reserve Bank of India (RBI) on Tuesday said it will soon put to circulation Rs 100 notes in the market with enlarged identification features.

RBI Governor Urjit Patel .

“The Reserve Bank will shortly issue Rs 100 denomination banknotes in the Mahatma Gandhi Series-2005, without inset letter in both the numbering panels,” RBI said in a release.

The notes with ‘2016’ printing year will be similar in design with the existing Rs 100 notes in the Mahatma Gandhi Series-2005 having ascending size of numerals in the number panels, bleed lines, and enlarged identification mark, on the obverse.

The RBI said it has already put to circulation Rs1 00 notes with the ascending size of numerals in the number panels but without bleed lines and enlarged identification mark. These notes will remain in circulation concomitantly with the notes being issued now, it added.

“All the banknotes in the denomination of Rs 100 issued by the central bank in the past will continue to be legal tender,” RBI said further.

Besides, earlier this week RBI had said that it will issue Rs 20 and Rs 50 denomination notes. Issue of these small value currencies will be a big relief to common consumers to meet their daily requirements as the Rs 2,000 denomination bank note available currently has a limited acceptability as finding change is a big issue when almost 86% of the cash has been wiped off the market to abolish Rs 500 and Rs 1,000 banknotes.

PTI

7th Pay Commission: No scope to change in minimum pay of Rs 18,000

New Delhi: Finance Ministry sources today said on condition of anonymity, there is no scope to change in minimum pay Rs 18,000, recommended by the 7th Pay Commission and approved by the cabinet.

After cabinet nod of 7th Pay Commission recommendations, Finance Minister Arun Jaitley said central government employees salaries have to be respectable in comparison to public or private sector.

The sources came up with the remark while talking to us about hiking of minimum pay Rs 18,000 by the pay related National Anomaly Committee more than the the cabinet approval of the minimum pay.

Those who will hope over this issue will gain nothing, there is no scope to change in minimum pay Rs 18,000, which was approved by the cabinet, they added.

Replying to a question, the sources said, “The demand of central government employees through National Joint Council of Action (NJAC) for hiking minimum pay Rs 18,000 to Rs 26,000 may be considered by the National Anomaly Committee but they can do nothing.

They said adding “Though government had promised hiking minimum pay after the central government employees unions had threatened to carry out an indefinite strike but now public sector workers demand minimum pay of Rs. 18,000, similar to the central government employees. They now get minimum pay less than Rs 18,000.”

They also told us, “Public Sector Undertaking (PSU), Coal India Limited (CIL) workers set to join the general strike on September 2 for hiking minimum pay of Rs 18,000 equivalent to central government employees.”

“Now, it is generally seen that Public Sector Undertaking employees get less pay than the central government employees and they will demand to hike pay equivalent to central government employees. So, the focus has now shifted to PSUs- whether they would implement a similar pay hike for their employees or not.”

“If they hike pay for their employees, the central government is likely to face difficulty in bearing this extra financial burden. Accordingly, central government employees demand for hiking minimum pay of Rs 18,000 will not be accepted,” they confirmed.

After cabinet nod of 7th Pay Commission recommendations, Finance Minister Arun Jaitley said central government employees salaries have to be respectable in comparison to public or private sector.

TST

7th Pay Commission to get cabinet nod tomorrow, says Finance Secretary

New Delhi: 7h Pay Commission recommendations for 4.8 million central government employees and 5.2 million pensioners will be placed in the next cabinet meeting, scheduled to be held on Wednesday, Finance Secretary Ashok Lavasa said on Monday.

The Cabinet is likely to take up 7th Pay Commission recommendations for central government employees on Wednesday, Finance Secretary Ashok Lavasa said on Monday.

The Empowered Committee of Secretaries, headed by Cabinet Secretary P K Sinha, which was formed in January to review 7th Pay Commission's recommendations, has finalised its report, he added.

“The committee very recently had their last meeting. They have taken a final decision. Now, we are waiting for the minutes of the meeting. We will soon draft a cabinet note based on the report,” he told reporters.

The cabinet proposal is almost ready as recommended by the Empowered Committee of Secretaries and the 7th Pay Commission headed by Justice A K Mathur, according to a finance ministry official.

The Finance Ministry will sent a report on the proposed pay and allowances, which were recommended by the Empowered Committee of Secretaries, to the Prime Minister's Office (PMO) on Tuesday.

The PMO will send it back to the ministry with some instructions on the same day and it will be sent to the cabinet on Wednesday, the official said.

The notification of 7h Pay Commission recommendations will be issued shortly after the approval of the cabinet.

Under the prevailing circumstances, the central government employees may start drawing the increased salaries under the new pay matrix from July and arrears of the previous six months will be got in August.

Sources said the secretaries’ panel may have recommended higher pay increase, with minimum pay at Rs 23,500 a month and maximum salary of Rs 3.25 lakh.

The government employees are also likely to get double of existing rates of allowances and advances, which has been recommended for abolition by 7th Pay Commission like risk allowance, small family allowance, festival advance, motor cycle advance.

The 7th Pay Commission had recommended 23.55 per cent overall hike in salaries, allowances and pension involving an additional burden of Rs 1.02 lakh crore or nearly 0.7 per cent of the GDP.

The Commission recommended a 14.27 per cent increase in basic pay, the lowest in 70 years. The previous 6th Pay Commission had recommended a 20 per cent hike which the government doubled while implementing it in 2008.

The Commission proposed the highest basic salary at Rs 250,000 from current Rs 90,000 and the lowest at Rs 18,000 from current Rs 7,000 for the central government employees.

Finance secretary also told reporters the 7th Pay Commission report will be effective from January 1.

TST

Kendriya Sainik Board–Financial Assistance–Maj Milind Tungar

 

 

Maj Milind Tungar

Dy Director,

Department of Sainik Welfare Maharashtra State

7th Pay Commission review panel findings not binding on Government , says Finance Ministry

New Delhi: The Finance Ministry is to make clear that government is not bound by the findings of the Empowered Committee of Secretaries on 7th Pay Commission's recommendations.

Arun Jatley, Union Finance Minister, will give the government’s formal response to the Empowered Committee of Secretaries.

The Government will not necessarily be bound by the findings of the Empowered Committee of Secretaries on 7th Pay Commission for central government employees, the Finance Ministry official involved with the process of pay hike told The Sen Times on condition of anonymity.

Amid a growing expectation that the Empowered Committee of Secretaries headed by the Cabinet Secretary P K Sinha will recommend 30 per cent hike in salaries of central government employees, that would take the minimum basic monthly pay to Rs 23,500 and the maximum to Rs 3,25,000, while government is set to cut the salary for the higher rungs and increase that for the lower grades to add a populist hue, accordingly source stressed that government would make its own decision.

“The Empowered Committee will make its proposal,” source said. “government will make the decision.”

He said it is vital for government to increase the pay of lower grade employees to enjoy growing popularity in central government employees.

Arun Jatley, Union Finance Minister, will give the government’s formal response to the Empowered Committee of Secretaries, which is chaired by the Cabinet Secretary P K Sinha, after receiving its findings from their another two meetings.

The government may welcome the Empowered Committee report but the cabinet will take its own decision, the source said.

The Prime Minister's office (PMO) told the Empowered Committee that the salaries of employees in the lower rungs should rise by he highest percentage.

The government decided to give highest percentage salary rise to bottom grades employees and pay parity ratio of mid-level tier officers will be maintained with the bottom grade, source added.

Earlier, all pay commissions had not only recommended for good salary to top central government officials but also considered the disparity ratio between its highest and lowest paid employees.

For instance, in 1948, the salary of the highest paid government official was Rs 2,263 which was 41 times higher than the Rs 55 paid to the lowest earning employee. With subsequent pay commissions the ratio was reduced to about 1:12 in 2006.

The 7th Pay Commission headed by Justice A K Mathur recommended the highest basic salary at Rs 250,000 and the lowest at Rs 18,000 and its increased the pay ratio between the minimum and maximum from existing 1:12 to 1:13.

TST

Finance Ministry to review domestic black money window

New Delhi: With the first month nearing completion, the Finance Ministry will hold a high-level meeting to review the ambitious one-time compliance window that has been announced by the government to declare domestic black money.

Revenue Secretary Hasmukh Adhia

The review meeting, scheduled later this week, will be chaired by Revenue Secretary Hasmukh Adhia with CBDT members and they will be talking to all the nodal Principal Commissioners of Income Tax department of the scheme in the country, and officials said the "strategies" and action points for the successful implementation of the window called the Income Declaration Scheme (IDS) will be discussed.

They said some other issues related to human resource management of the department will also be discussed in the same meeting.

The IDS was opened by the government on June 1 and will be in force till September 30.

Due taxes have to be paid by November 30 by the declarants.

Under the compliance window, income as declared by the eligible persons, would be taxed at the rate of 45 per cent which is 30 per cent plus a 'Krishi Kalyan Cess' of 25 per cent on the taxes payable and a penalty at the rate of 25 per cent of the taxes payable on the income declared.

The scheme was announced by the government with an aim to squeeze out black money from the domestic economy.

The government had come out with a similar scheme for Indians holding undisclosed income abroad last year.

The current scheme will apply to undisclosed income, in the form of investment in assets or otherwise, pertaining to Financial Year 2015-16 or earlier.

The declarations under the IDS can either be made online on the official e-filing website of the IT department or before the various regional principal commissioners.

PTI

IT dept to block PAN, LPG subsidy of defaulters

New Delhi: In order to cripple and check the activities of wilful tax defaulters, the Income Tax department has decided to "block" Permanent Account Number (PAN) of such entities, get their LPG subsidy cancelled and take measures to ensure that they are not sanctioned loans.

CBDT Chairman A K Jain

A number of such measures have been mooted by the tax department, to be undertaken this financial year, in order to curb the menace of large-scale tax avoidance and evasion.

As per a strategy paper prepared by the department, also accessed by PTI, the taxman will block PAN in such a way "that these defaulters are not sanctioned any loans or overdraft facility by public sector banks, as the same is bound to become non-performing assets".

Further, it said, "Ministry of Finance can be suggested to withdrawn facility like LPG subsidy which is directly credited in to the bank accounts of the said defaulters."

This step, the strategy paper said, will act to "disincentive" the defaulters.

The taxman also proposes that the identities of such blocked PANs be circulated to the Registrar of Properties "with a request for not allowing any registration of immovable properties where such PANs are involved."

Such defaulters' information has also been recommended to be circulated across tax offices so that their activities loans or government subsidy can be plugged country-wide.

The department has also decided to subscribe to the Credit Information Bureau Limited (CIBIL) data, on a possible payment basis, to check out the financial activities of defaulters and undertake action against them for recovery and freezing of assets.

CIBIL is an agency to collect and maintain records of an entities' payments pertaining to loans and credit cards.

The department, beginning last year, has also started to 'name and shame' large tax defaulters (over Rs 20 crore default) by publishing their names and other credentials in leading national dailies and on its official web portal.

Till now, 67 such entities have been put in public domain by the department.

The IT department, beginning this financial year, has also decided to publicly name all category of taxpayers who have a default of Rs one crore and above.

"Tax default is a major menace that the department is grappling with.These new measures are aimed to curb these instances in the right earnest," a senior IT official said.

PTI

Finmin Refutes Claims Of Inflation Due To 7th Pay Commission Award

New Delhi: A salary hike is likely proposed by the Empowered Committee of Secretaries, which has been constituted to look into the recommendations of the 7th Pay Commission for cabinet nod, will not fuel inflation, says Finance Ministry top officials.

Finance Minister Arun Jaitley said that the Pay commission award increase government expenses by Rs 1.02 lakh crore but that would not be a problem. “The implementation of these recommendations will not affect inflation. The recommended pay scale has been hiked in line with the increasing size of the budget of government of India,” they told our reporter. The 13-member body of Empowered Committee of Secretaries, headed by the Cabinet Secretary P K Sinha, who is processing the recommendations of the 7th Pay Commission decided to hand over soon its possible proposal to the the Finance Minister Arun Jaitley for cabinet nod. It is likely to propose a substantial pay hike which could be up to 30 per cent or even more, said officials. the 7th Pay Commission had recommended a minimum monthly basic salary of Rs. 18,000 and maximum Rs. 2,50,000. A 30 percent increase would translate into minimum basic salary of Rs. 23,400 and maximum at Rs. 3,25,000, respectively.

However, The Empowered Committee is likely to purpose Rs 2,70,000 as highest basic pay and Rs 24,000 as the lowest, they also likely to recommend for doubling of existing rates of allowances and advances, the officials added. The government in its annual budget has provisioned Rs 70,000 crore to meet the demand for implementation of 7th Pay Commission for central government employees which will take effect from January 1, 2016, while the allowances would be paid from the date of implementation. “Central government employees could get the revised pay and allowances from their August salaries and arrears are to be paid ahead of festive season of Dussehra in one installment,” the officials confirmed. The Economists fear that the 30 percent salary hike would fuel inflation as the pay commission recommendations will also have a bearing on the salaries of the state government staff. So quite understandably, the government employees are happy as pay increase will enable them to increase their consumption and meet some of their unmet demand.

At the same time, there is a widespread fear that the pay commission recommendations are likely to increase inflation which will reduce the purchasing power of money. RBI Governor Raghuram Rajan earlier said the 7th Pay Commission recommendations will not upset fiscal maths as additional expenditures will be offset by either surplus revenues or expenditure cuts.

Finance Minister Arun Jaitley earlier also said hat he was not worried about fiscal deficit on implementation of the pay commission’s recommendations. He said that the Pay commission award increase government expenses by Rs 1.02 lakh crore but that would not be a problem.

“The government has sufficient resources. Implementing the 7th Pay commission award will not affect inflation.” the official told our reporter. The officials said that apart from hiking pay, the government is also likely to propose some administrative reforms, to be implemented in phases.

TST

Abolish income tax to push growth: Swamy

Mumbai: BJP leader Subramanian Swamy today pitched for abolition of Income Tax to increase savings rate and help economic growth, and also suggested nationalisation of funds stashed in tax havens to retrieve the black money.

"The only way to encourage people to save more today is by abolishing the income tax completely," BJP leader Subramanian Swamy said.

Finance Minister Arun Jaitley did not use this method because he, being a lawyer, was "sensitive" to the rights of those who have kept black money abroad, Swamy said at an event here.

"If I am in the Government, I will do it within one week, if I am not in Government, I will do it (remove income tax) within three years. The only way to encourage people to save more today is by abolishing the income tax completely," Swamy said.

While Prime Minister Narendra Modi exhorted the tax authorities to double the tax base to 10 crore earlier in the day, Swamy said here the national savings rate has dipped to 33 per cent and needs to be pushed up to at least 40 per cent.

Increase in the savings rate will provide resources for growth and the Rs 2 trillion which will have to be foregone (if the income tax is abolished) will get more than compensated, Swamy said, stressing that the country needs to push the growth up to 10 per cent per annum for at least a decade for eradicating poverty and unemployment.

The leader claimed that Rs 120 trillion or 60 times the revenues from tax collection is stashed in tax havens abroad which needs to be brought back.

Citing his conversation with Modi, he said the Prime Minister has "preferred" adoption of a UN-approved method of recovering the black money by nationalisation of such funds.

"If any country passes a law...That the citizens of their country holding accounts in the banks of these 70 countries (practising secret banking), their bank account is hereby nationalised," he said.

Stating that countries like Egypt, the Philippines and Libya have used this method, Swamy said Modi has asked him to prepare a note on the same.

"I am hoping that the note that I will be giving to the PM in a few days will translate itself into a law, into a legislation and then we can hope we will get all these countries to give the money," he said.

"Why didn't we do this all this while? Because Jaitley is a lawyer and he was little sensitive to the rights of those who have accounts there. But now the PM says this is an important issue and we have to do something about it," he said.

PTI

Remove fear of harassment among taxpayers, PM tells CBDT, CBEC officials

New Delhi: Prime Minister Narendra Modi today asked the CBDT and CBEC officials to remove fear of harassment from the minds of taxpayers and focus on five pillars of administration -- revenue, accountability, probity, information and digitisation (RAPID).

Prime Minister Narendra Modi and Finance Minister Arun Jaitley today at Rajasva Gyan Sangam.

Inaugurating the two-day Rajasva Gyan Sangam here, Prime Minister asked the officials to "move towards digitisation" in a bid to make tax administration better and efficient and work towards bridging the "trust deficit".

Modi also suggested that officials should endeavour to remove "fear of harassment" from the minds of assesses and emphasised that their behaviour should be "soft and sober", Minister of State for Finance Jayant Sinha said while briefing reporters about the meeting.

Finance Minister Arun Jaitley and senior tax administrators of Central Board of Direct Taxes (CBDT) and Central Board of Excise and Customs (CBEC) are participating in the two-day annual conference.

Prime Minister also underlined the need for increasing the number of tax payers to 10 crore from 5.43 crore, at present.

PTI

FinMin seeks free access to PNR details for all depts to curb LTC fraud

New Delhi: The Finance Ministry sought all ministries and departments to have free access to the Indian Railways' passenger reservation data to check widespread fraud in Leave Travel Concession (LTC) and Travel Allowance (TA) claims made by central government employees.

Finance Ministry wrote to Railway Board Chairman A K Mittal about the problem with fraud LTC and TA claims.

In a letter addressed to Railway Board chairman A K Mittal, a Joint Secretary in the Finance Ministry, Annie George Mathew, has written that submission of bogus or forged rail tickets with LTC/TA claims was a common problem faced by the government.

Mathew requested the Railways to consider giving access to Passenger Name Record or PNR-related information to ministries and departments free of cost "in the overall interest of transparency and corruption-free government".

The development follows an audit report and subsequent letter from Additional Controller General of Defence Accounts (A-CGDA) A K Saxena, who found that 3,500 LTC and TA claims made by Indian Air Force (IAF) personnel, including 400 officers up to the rank of Air Commodore, were fake.

Saxena's report estimates the total fraud over the past five years to be around Rs 350 crore. Individually, the amounts seem petty but the fraud could affect promotions of several high-ranking officers as the auditor has recommended strict action against them.

The letters and the audit report of the Dehra Dun-based Principal Controller of Defence Accounts (PCDA) have been reviewed by the media like The Economic Times.

Saxena had earlier written to the railways seeking access to passenger records, but the national transporter had demandedRs 750 per PNR for the information.

It would cost CGDA about Rs 12.5 crore per year just to verify the PNRs of the 1.5 lakh LTC and TA claims it audits annually.

Now the Finance Ministry has sought free access to the information for all ministries and departments.The PCDA audit had found that in many cases tickets presented for reimbursement were fake and hotel bills were inflated or bogus.

In some cases where IAF officers took flights, they forged the signatures of the under-secretary of the civil aviation ministry. The ministry's approval is mandatory when officers fly airlines other than Air India.

Some people digitally altered the amounts on the tickets to show a higher fare than they actually paid. The auditors suspect there could be an organised racket, considering "the widespread forgery across all commands, involvement of large number of personnel from accounts branch, uniformity in methodology and use of information technology".

Inputs with ET