- GOVERNMENT PLANS GST SOPS FOR DIGITAL PAYMENTS: The Centre has proposed a 2% discount in the GST for consumers who make digital payments. The proposal is likely to be taken up in the next GST council meeting in January. The move if approved will boost the government’s efforts for cashless economy.
- CRISIL SAYS NBFCs WILL EAT INTO BANKS’ CORPORATE CREDIT SHARE: Non-Banking Financial Companies have become aggressive in lending to mid-sized companies linked in real estate and infrastructure. The share of NBFCs in such loans in Indian credit market has increased by 3% and presently it is 19%. CRISIL has predicted that the next three years also the NBFCs will continue aggressive lending and this would eat up Banks’ share.
- I-T NOTICES TO 1.16 LAKH INDIVIDUALS FOR CASH DEPOSIT OF OVER Rs 25 LAKH: The Income Tax Department has issued notices to 1.16 lakh individuals and firms who made cash deposits of more than Rs.25 lakhs in bank accounts post note ban but have failed to file tax returns by the due date. Besides this the I-T Department is scrutinising those individuals and firms who have deposited large sum of cash but have filed their tax returns in time.
- AFTER GST CHANGES ROLLLED OUT, CENTRE ALLOWS FIRMS TO PASTE NEW MRP STICKERS: Following the changes being put in effect on GST rates for about 200 items, Government is allowing firms to paste stickers on packed products to reflect the new MRP. This will be allowed till December 31, 2017.
- I-T DEPARTMENT MAY TAX UNSOLD REALTY INVENTORIES TO CURB HOARDERS: The Income Tax Department may levy fresh tax on the unsold inventories in the real estate sector from the next financial year. This is to check hoarding. Unsold flats have been lying with many developers for more than a year and this may be taxed from next year. This is a move to curb strategy of hoarding constructed property by developers in anticipation of price escalation in future.
- INDIA BECOMES 8TH BIGGEST EQUITY MARKET IN THE WORLD: India has surpassed Canada to become the 8th biggest equity market in the world. India’s market cap has swelled by 46.4% in 2017, faster than most of its emerging market peers.
- GOVERNMENT’S NEW PROPOSAL “BAIL-IN” FACES LOT OF OPPOSITION FROM ALL QUARTERS: The Centre’s proposed Financial Resolution & Deposit Insurance Bill ( FRDI) , which is aimed at plugging bankruptcies in the financial service sector, includes a special provision (“BAIL-IN”) which by definition allows the affected banks to use depositors’ money to absolve some of the losses. The bill has suggested the use of “Bail-in” provision, which may result in cancellation of a liability, which could include bank deposits or could lead to modification of the terms of contract or changing the form of asset class (SB amount converting to FD for a fixed term). The provision would be last in the line for payments in case of liquidation. The present Deposit Insurance Scheme will be subsumed by the new bill, but the Rs 1 lakh deposit insurance will not change. But the plan has generated lot of heat and opposition from all quarters like political parties and bank unions who have criticised the move. Now the government has hinted at reworking the provision. It says no commercial bank has been allowed to sink in the last 70 years and that implicit sovereign guarantee continues even with this new bill. So in our opinion the question arises as to how safe is our Bank Deposits?
This post first appeared on IMPACT OF DEMONITIZATION OF CURRENCY IN INDIA IN 2016, please read the originial post: here