I-T department keeps tolerance range for transfer pricing unchanged

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In a disappointment to businesses reeling from the Covid impact, the department has kept the tolerance range for transfer pricing unchanged for 2019-20.


This implies that there will be no relief for businesses dealing in related-party transactions.



The CBDT on Monday re-notified the prevailing 1 per cent tolerance range for wholesale trading and 3 per cent range for all other transactions undertaken during the financial year ending March 31, 2020.


Amit Agarwal, Partner Nangia & Co, said given the pandemic, it was expected the CBDT would take into account economic and business realities while notifying the tolerance range for transfer pricing cases.


“The tolerance range, as laid down, appears to be a mechanical follow-through of last year’s notification, without appreciating the business and commercial realities in Covid-19 times,” said Agarwal.


Indian transfer pricing rules prescribe a range of 35th to 65th percentile. However, in certain cases, arithmetic mean is used to measure the arm’s length price and tolerance range.


Similar to previous years, to qualify as “wholesale trading,” the purchase cost of finished goods must be 80 per cent or

PHDCCI chief Sanjay Aggarwal wants highest income tax rate cut to 25%

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PHD Chamber of Commerce and Industry’s (PHDCCI’s) new president Sanjay Aggarwal on Sunday said the next Budget should lower the maximum (I-T) rate to around 25 per cent from the current 30 per cent plus surcharges.


“In the current scenario, there is a need to increase the disposable income of people by reforming the direct tax structure. The maximum personal rate should be around 25 per cent to increase the personal disposable income. This will boost demand in the economy,” Aggarwal, who is chairman and chief executive officer (CEO) of Paramount Cables, said.


His comment was in contrast to economist Joseph Stiglitz’s, who wanted the rich to be taxed more under the current circumstances.




Currently, an annual income of over Rs 10 lakh attracts 30 per cent tax, besides education and health cess of four per cent under the old regime. If an assessee chooses the new scheme of less exemptions, annual income of over Rs 15 lakh attracts 30 per cent tax. Besides, there are surcharges if annual income is above Rs 50 lakh. These go up to 37 per cent of the tax rate

Is Bangladesh economy really doing better than India? Former CEA doesn’t think so

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On ‘more appropriate’ economic metric, has not surpassed India and is unlikely to be in future, former chief economic adviser said on Saturday, asserting that GDP per capita is an estimate for one indicator of the average standard of welfare in a country.


Congress leader Rahul Gandhi had taken a dig at the government over growth projections showing closing in on India in terms of per capita GDP this year and described it as a “solid achievement” of six years of the BJP’s “hate-filled cultural nationalism”.



Government sources had emphasised that India’s Gross Domestic Product (GDP) in terms of purchasing power parity was 11 times more than that of in 2019.


“The India-vs.-Bangladesh GDP per capita comparison (post WEO) has sparked anxiety & acrimony. But wrong numbers being compared…


“NO, on more appropriate metric, India has not been surpassed and, according to IMF, unlikely to be in near future,” Subramanian said in a series of tweets.


He said all the focus has been on comparisons based on GDP measured at current, market exchange rates and this yields “conclusion”

Rural consumption better placed during Covid-19 pandemic, shows data

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An EcoScope report of Motilal Oswal Financial Services says that while urban consumption declined 18 per cent year-on-year

Topics
Rural consumption | Coronavirus


While the is holding on to its previous year level, the urban consumption has declined massively in the first two months of the second quarter of this fiscal year.


An EcoScope report of Motilal Oswal Financial Services says that while urban consumption declined 18 per cent year-on-year, was almost flat (+0.1 per cent YoY) in July-August of 2020-21.




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PM Narendra Modi calls for scaling up of Covid-19 testing, sero surveys

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Calling for continued vigilance and a high state of preparedness against the Covid-19 pandemic, Prime Minister on Thursday directed health authorities to scale up Covid-19 testing and sero-surveys.


He said the facility to get tested regularly and speedily at a low cost must be available to all at the earliest.



Chairing a review meeting of the research and vaccine deployment ecosystem against the pandemic, the prime minister underscored the need for continuous and rigorous scientific testing and validation of traditional medicine treatments. He appreciated the efforts of the Ministry of AYUSH for conducting evidence-based research and providing reliable solutions in this difficult time, an official statement said.


“The prime minister reiterated the country’s resolve to provide cost-effective, easily available and scalable solutions for testing, vaccine and medication, not only for India but for the entire world,” it said.


At the meeting, also attended by Union Health Minister Harsh Vardhan, NITI Aayog Member (Health), Principal Scientific Advisor, senior scientists and other officials, Modi called for continued vigilance and a high state of preparedness against the pandemic.


Modi also appreciated efforts made by Indian vaccine

Rajiv Kumar hits backs at Subramanian for criticising Aatmanirbhar Bharat

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NITI Aayog Vice-Chairman Rajiv Kumar on Wednesday hit back at former chief economic advisor (CEA) Arvind Subramanian for criticising the government’s Aatmanirbhar Bharat initiative, saying it effectively started during Subramanian’s tenure as CEA.


Subramanian, in a research paper co-authored with Pennsylvania State University professor Shoumitro Chatterjee, has said India should resist the misleading allure of domestic market and zealously boost exports.



“Very surprised to read @arvindsubraman’s co-authored piece this morning criticising #AtmanirbharBharat. It effectively started during his tenure as chief economic advisor which as he writes saw the highest increase in import tariffs in 2018 to nearly 18 per cent,” Kumar said.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

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