Rahul Gandhi Attacks Budget In LS Speech; GST Fitment Panel Mulls Options To 4-Slab Structure

Rahul Gandhi Says Budget Betrayed Middle Class By Hiking Long Term Capital Gains Tax

Leader of the Opposition in the Lok Sabha, Rahul Gandhi, on Monday said the Union Budget for FY25 betrayed the middle class by increasing the tax on the long-term and short-term capital gains and removing the benefit of indexation, Business Standard reported. 

He claimed the middle class, which, he said, has been the ruling party’s core support base, were now deserting it. Participating in the discussion on the Budget in the Lok Sabha, Gandhi faulted the Centre’s Employment-Linked Incentive (ELI) Scheme, which, he said, focuses on the top 500 companies that employ merely a per cent of the workforce, but ignores the informal sector. The Congress leader said 99 per cent of the youth will not benefit from the scheme. Read more

GST Fitment Panel Discussing Two Options To Replace Current Four-Slab Setup

The fitment panel under the Goods and Services Tax Council is discussing two options to replace the current four-slab rate structure for making its proposal to a group of ministers tasked with recommending changes towards GST rationalization, Business Standard reported.

Both options seek to ensure that there is no adverse impact on the prices of essential goods for mass consumption. Of the two rate structures on the table, one suggests tax slabs of 8 per cent, 16 per cent, and 24 per cent. The other proposes tax slabs at 9 per cent, 18 per cent, and 27 per cent. Both scenarios focus on shielding essential goods and may include a provision of tax abatements. However, luxury goods may be subject to different treatment, according to preliminary discussions. More here 

Centre’s Debt To Be Down To A Five-Year Low Of 56.8 Per Cent 

The Central government's total debt is estimated to ease to a five-year low of 56.8 per cent of the country's gross domestic product in the current fiscal from 58.2 per cent a year before, the Economic Times reported. 

In absolute terms, the debt, however, will rise to Rs 185.27 lakh crore (budget estimate) in FY25 from Rs 171.78 lakh crore last fiscal, Minister of State for Finance Pankaj Chaudhary said in a written reply in the Lok Sabha. The data include the Centre's external debt valued at the current exchange rate and other liabilities. Citing International Monetary Fund data, he said India's GDP at current prices already reached US$3.57 trillion in FY24. More here

RBI Says New Tech Has Enabled Growth in Fraudulent Apps, Mis-selling

The Reserve Bank of India has said that emerging technology has led to proliferation of fraudulent apps and mis-selling, the Economic Times reported.

Fintech firms still face significant challenges in counterparty credit risk assessment despite significant footprint expansion, the central bank said in its report on currency and finance. "Digitalisation presents challenges related to cybersecurity, data privacy, data bias, vendor and third-party risks, and customer protection," RBI Governor Shaktikanta Das wrote in the foreword to the report. "Additionally, emerging technologies can introduce complex products and business models with risks that users may not fully understand, including the proliferation of fraudulent apps and mis-selling through dark patterns." More here 

Centre Simplifies Scheme To Import Capital Goods At Zero Customs Duty For Export 

To make it easier for exporters to do business, the government has simplified the Export Promotion Capital Goods (EPCG) scheme which allows import of capital goods at zero customs duty against an obligation to export, the Economic Times reported.

As per a public notice issued by the Directorate General Of Foreign Trade (DGFT), exporters will now get additional time to submit installation certificates for imported capital goods, reducing pressure on businesses to meet timelines. Also, from now all Policy Relaxation Committee (PRC) decisions regarding Export Obligation extensions and regularisation of exports will be implemented with a levy of a uniform composition fee making it easier to implement through the system. More here 

Customs Duty Cut On Silver Could Hold Down Silver Imports From UAE

The steep cut in customs duty on silver in the FY25 Budget to 6 per cent from 15 per cent may provide the government temporary relief by checking the spurt in silver imports from the United Arab Emirates (UAE) under the Comprehensive Economic Partnership Agreement (CEPA), Business Standard reported.

In FY24, silver imports from the UAE jumped to US$1.7 billion from only US$11.18 million in FY23, according to commerce department data. In May, about 87 per cent of India’s silver imports came from Dubai. In 2022, India signed the CEPA with the UAE, agreeing to gradually reduce the duty on silver imports to zero over 10 years. The drop in import duty of silver to 6 per cent for all countries has thus nullified the advantage for importers to ship silver from UAE. More here