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See all Premium member Presentation Transcript Slide 1: PRESENTATION ON Slide 2: GOVERNMENT TAXATION POLICY IN INDIA INTRODUCTION ON TAXATION IN INDIA : INTRODUCTION ON TAXATION IN INDIA TYPES OF TAXES IN INDIA : TYPES OF TAXES IN INDIA DIRECT TAXES Income tax Wealth tax Property tax etc. INDIRECT TAXES Sales tax Vat Excise duty Custom duty etc. In Accordance With The Constitution Of Indian Government The Main Taxes/Duties That The Union Government Is Empowered To Levy : In Accordance With The Constitution Of Indian Government The Main Taxes/Duties That The Union Government Is Empowered To Levy INCOME TAX (except tax on agricultural income, which the State Governments can levy), VAT (value added taxes) Central Excise and Sales Tax (CST) Service Tax (tax levied on service provided ) PRINCIPAL TAX LEVIED BY THE STATE GOVERNMENT : PRINCIPAL TAX LEVIED BY THE STATE GOVERNMENT Sales Tax Stamp Duty State Excise Land Revenue Octroi LOCAL BODIES EMPOWRED LEVY TAXES ON : LOCAL BODIES EMPOWRED LEVY TAXES ON Property Expenditure User charges Slide 9: Procedure of payment of taxes Slide 10: What is Service tax? Service tax is an indirect tax levied under the Finance Act, 1994, as amended from time to time, on specified services. At present, there are approximately 96 categories (including 15 new services introduced by Budget 2006) of net services taxable under the service tax. SERVICE TAX WHO IS LIABLE TO DEPOSITE SERVICE TAX : WHO IS LIABLE TO DEPOSITE SERVICE TAX WHO IS AUTHORIZISE TO ADMINISTER SERVICE TAX WHAT IS THE CONSEQUENCE OF DELAY OF DEPOSITE OF SERVICE TAX : WHAT IS THE CONSEQUENCE OF DELAY OF DEPOSITE OF SERVICE TAX New services that have been brought under this tax net in Budget 2006-07 : New services that have been brought under this tax net in Budget 2006-07 Include services provided by share transfer agents and registrar to issues recovery agents, maintenance and management of Automatic Teller Machines sale of advertising space or time (except for print media) sponsorship of events by companies (except for sports) public relations management services, ship management services, international air travel (excluding economy class) Continued….. : Continued….. rail container handling services (excluding haulage charges), cruise ship travel, Internet telephony services business support services, auctioneers’ service (excluding auction of property under directions or orders of a court of law or auction by the government) and credit card, debit card and other payment card-related services. Slide 15: WHAT IS EXCISE DUTY -Excise duty is an indirect tax levied and collected on goods manufactures in india . EXCISE DUTY Slide 16: WHO IS RESPONSIBLE TO PAY EXCISE DUTY TO THE GOVERNMENT ON WHICH GOODS EXCISE DUTY IS CHARGED HOW AND WHEN EXCISE DUTY IS PAID HOW EXCISE DUTY IS DIFFERENT FROM OTHER TAX : HOW EXCISE DUTY IS DIFFERENT FROM OTHER TAX HOW EXCISE DUTY IS CALULATED Changes/Amendments have Been Made Vide Budget 2006. : Changes/Amendments have Been Made Vide Budget 2006. Exemption from payment excise duty on manufacture of computer has been withdrawn &with effect from March 1,2006,excise duty on of 12% has been impose on manufacture of computers. Excise duty impose on package software, also know as canned software is about 8% Excise duty on storage device i.e. DVD driver .USB flash memory has been reduce from 16% to Nil Excise duty on MP3 Player & MPEG4 player reduced from 16% to 8% : Custom Duty Is A Tax Which A State Collects On Goods Imported Or Exported Out Of The Boundaries Of The Country CUSTOM DUTY In India, Custom Duties Are Levied On The Goods And At The Rates Specified In The Schedules To The Custom Tariff Act, 1975 OBJECTIVES OF CUSTOM DUTIES : OBJECTIVES OF CUSTOM DUTIES Restricting Imports For Conserving Foreign Exchange Protecting Indian Industry From Undue Competition Regulating Exports Prohibiting Imports And Exports Of Goods For Achieving The Policy Objectives Of The Government Co-ordinating Legal Provisions With Other Laws Dealing With Foreign Exchange CUSTOM DUTY IS LEVIED ON : CUSTOM DUTY IS LEVIED ON IMPORT OF GOODS EXPORT OF GOODS RULES : RULES Custom Valuation Rules,1988 For Valuation Of Imported Goods That Calculates The Custom Duty Payable Custom And Central Excise Duties Drawback Rule,1971 For Calculating Rates Of Duties As Drawbacks On Exports Regulations : Regulations The Central Board Of Excise And Customs Has Been Empowered To Make Regulations To Carry Out The Provisions Of The Act In Order To Maintain The Rules Of The Act Several Regulations Like Customs House Agnents Licensing Regulations, 1984 Have Been Framed. Notifications : Notifications The Central Government May Also Issue Notifications In The Official Gazette For The Purpose Of The Act. The Notification Is Not Considered To Be Valid If It Is Not Approved Within A Span Time Of Fifteen Days. Slide 25: why custom duty is paid? Types of custom duties : Types of custom duties Basic duty Addition duty Anti-dumping duty Export duty Protective duty What Is Instant Online Custom Duty : What Is Instant Online Custom Duty Instant Online Custom Duty Is An Product For Online Payment Of Taxes And Expenses Developed Jointly By Bank Of China And The Custom. Advantages And Characteristics Of Online Instant Custom Duty : Advantages And Characteristics Of Online Instant Custom Duty Online Payment Of Taxes And Expenses Is A Supplementary Service Of China Electronic Port. The Enterprises Can Apply To Go Through Relevant Import And Export Procedures With Government Agencies The first bank that cooperate with the custom on development of products for online payment of taxes and expenses in china, bank of china has rich experience in development, operation and service maintenance of the products. Types Of Taxes And Expenses Paid Instant Online Custom Duty : Types Of Taxes And Expenses Paid Instant Online Custom Duty Import/Export Custom Duty Anti-dumping Tax And Other Special Custom Duties Import Value-added Tax Import Consumption Tax Business Process Of Instant Online Custom Duty Operating Process : Business Process Of Instant Online Custom Duty Operating Process Become port user Bank checks tariff Custom examination And clearance Bank deduction succeeds Bank withholding Enterprise online payment Customs electronic tariff Imposition notice Open an account At bank of china Tariff is transferred to Treasury or customs Apply for online payment service Slide 31: SALES TAX ACT. WHAT IS SALES TAX? : WHAT IS SALES TAX? Sales tax is a tax on the supply of goods and certain services ,it is charged at the time of sale and then deposited in the Government treasury. WHAT TYPES OF BUSINESS ARE NOT LIABLE FOR SALES TAX? : WHAT TYPES OF BUSINESS ARE NOT LIABLE FOR SALES TAX? Agricultural Products Most Of Pharmaceutical Products Educational & Scientific Materials Equipment For Fighting AIDS & CANCER How does sales tax operate? : How does sales tax operate? Output tax Input tax HOW SALES TAX REGISTERED : HOW SALES TAX REGISTERED WHEN IS SALES TAX PAYABLE? Objects of sales tax : Objects of sales tax To formulate principles for determining To provide for levy, collection and distribution of taxes To declare certain goods BASIC SCHEME OF THE CST ACT : BASIC SCHEME OF THE CST ACT Sales Tax Revenue To States Tax Collected In The Sated Where Movement Of Goods Commences Tax On Inter State Sale Of Goods State Sales Tax Law Applicable In Many Aspects CST Act Defines Some Concepts Declared Goods INTER-STATE AND INTRA-STATE SALE : INTER-STATE AND INTRA-STATE SALE WHAT IS INTERSTATE SALE : WHAT IS INTERSTATE SALE According To S3, A Sale Or Purchase Shall Be Deemed To Take Place In The Course Of Interstate Trade Or Commerce In The Following Cases: When The Sale Or Purchase Occasions The Movement Of Goods From One State To Another When The Sale Is Effected By A Transfer Of Documents Of Title To The Goods During Their Movement From One State To Another Main Principles In States Sales Tax Laws : Main Principles In States Sales Tax Laws Existing Goods Or Future Goods In Most Of The Cases Related To The Sales Tax Under The Provisions Of Same State Laws A Quarter Return Of Sales Or Purchases Concerned Sales Tax/Commercial Tax Officer Apply For Registration And Obtain A Registration Slide 41: VAT POLICY IN INDIA INTRODUCTION OF VAT : INTRODUCTION OF VAT WHAT IS VAT? : WHAT IS VAT? Vat Means Value Added Tax Vat Paid By Dealers On Their Purchases Is Usually Available For Set-off Against The Vat Collected On Sales. IS VAT YET ANOTHER TAX : IS VAT YET ANOTHER TAX It Will Replace The Following Four Existing Taxes: The Bombay Sales Tax Act, 1959 The Maharashtra Sales Tax On The Transfer Of Right To Use Any Goods Bombay Sales Of Motor Spirit Taxation Act,1958 WHY CHANGE TO VAT : WHY CHANGE TO VAT Vat Is A Modern And Progressive Tax System Now Used In Over 130 Other Countries. WHAT ARE THE BENEFIT OF VAT : WHAT ARE THE BENEFIT OF VAT It Is Simple, Transparent And Progressive Business Friendly System Of Taxation Reduction In The Number Of Tax Rates To Only Two Main Rates – 4% And 12.5% Reduction In The Effective Tax Rate For Many Goods Elimination Of “Tax On Tax” Existing In The Sales Tax System Simplification Of Tax Forms And Procedures WHAT TYPES OF BUSINESS ARE LIABLE FOR VAT? : WHAT TYPES OF BUSINESS ARE LIABLE FOR VAT? VAT APPLIES TO ALL TYPES OF BUSINESS INCLUDING: Importers Manufacturers Distributors Wholesalers Retailers Works Contractors Lessors HOW IS VAT CHARGED? : HOW IS VAT CHARGED? Vat Is Not A Cost To The Dealers Vat As A Separate Amount On A Bill Or Cash Memorandum WHAT ARE THE OBLIGATIONS OF DEALERS REGISTERED FOR VAT? : WHAT ARE THE OBLIGATIONS OF DEALERS REGISTERED FOR VAT? Dealers Who Are Required To Be Registered For Vat Must: Change And Collect Vat On Their Sales Of Taxable Goods Issue Proper Tax Invoices Keep Proper Records And Books Of Account Calculate The Vat To Government Based On Vat File Vat Returns On A Regular Basis Declaring Their Vat Liability WHAT IS RATE OF VAT? : WHAT IS RATE OF VAT? Under The Vat, The Tax Rates Have Been Simplified: 4% For Items Consisting Mainly Of Raw Materials Used In The Manufacturing Process 12.5% For All Goods Unless They Are Listed Under The Other Rates. Foodgrains Including Pulses, Milk, Vegetables Books are Not Subject To Vat. Slide 51: Wholesaler Sales Price Rs.1,800 Total Vat Rs.180 Vat Payable 180-150=30 Retailer Sales Price Rs. 2,000 Total Vat Rs.200 Vat Payable 200-180=20 Sales Price Rs.1,500 Total Vat Rs.150 Vat Payable 150-100=50 Manufacturer Sale Price Rs. 1,000 Vat Rs. 100 Raw Material Producer Consumer DEFINITION OF INCOME TAX : DEFINITION OF INCOME TAX “An income tax is tax levied on financial income of person co-operation or other legal entity.” HISTORY : HISTORY PRINCIPLES : PRINCIPLES Personal Earnings Capital Gains Business Income Rates For Different Types Of Income May Vary And Some May Not Be Taxed At All. Capital Gains May Be Taxed When Realized Business Income May Only Be Taxed If It Is Significant Personal Earnings May Be Strictly Defined Tax Rates May Be Progressive, Regressive,or Flat A Progressive Tax Taxes Differentially Based On How Much Has Been Earned Personal Income Tax Is Often Collected On A Pay-as-you-earn Basis Slide 56: INCOME TAX SYSTEM CRITIQUE OF INCOME TAX : CRITIQUE OF INCOME TAX Extremely Complex Requiring Detailed Record-keeping Lengthy Instructions Complicated Schedules Worksheets And Dorms It Can Penalize Word Discourage Saving And Investment Not Border-adjustable CHARGE OF INCOME TAX : CHARGE OF INCOME TAX Section 4 Of The Act States That- Income Tax Shall Be Charged At The Rates Laid Down By The Finance Act For That Assessment Year In Accordance With Subject To The Provisions Of This Act In Respect Of The Total Income Of The Previous Year Of Every Person COMPUTATION OF INCOME AND TAX : COMPUTATION OF INCOME AND TAX Determine Scope Of Total Income Residence Year Place Exclude Exempt Income Classify Income Under Different Heads Compute Income Under Each Head Determine Gross Total Income Deduct Claims For Deductions Compute Net Taxable Income Compute Net Tax NIT= GTI-DA INCOME TAX =NET (IT)*(Rate of tax) Slide 60: Whose Income Income Of Every Person What Is Income Income How Computed? Income Computed According To Provisions Of Income Tax Act Income Of What Period Income Of “Previous Year” Payable By Whom? Payable By Assessee When Computed? Assessment Year How Computed? Assessment At What Rate? (Rate Laid Down In Annual Finance Act I.E Budget INCOME TAX INCOME TAX Slide 61: PERSONAL TAX RATES For Individuals, Huf, Association Of Persons (Aop) And Body Of Individuals (Boi): Slide 62: Tax Rates for NRI FRINGE BENEFIT TAX : FRINGE BENEFIT TAX Slide 64: INCOME TAX RATES ACROSS THE WORLD CORPORATE INCOME TAX : CORPORATE INCOME TAX Income Tax Deduction Income Tax Sections Section10(30) Section88b Section88c INDIVIDUAL INCOME TAX : INDIVIDUAL INCOME TAX Income Tax On Salary Income Tax On House Property Income Tax On Pension Income Tax On Capital Gains Income Tax Upon Income From Business Or Professions Slide 67: Don't Run Away From It's Only For Our Benifits Slide 68: THANK YOU ! You do not have the permission to view this presentation. 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