Tag Archives: Ministry of Finance

Ministry of Finance has announced that there will be no change in the rate of TCS for all purposes under LRS and for overseas travel tour packages, regardless of the mode of payment, for amounts up to Rs. 7 lahks per individual per annum. For the purchase of overseas tour program package under Clause (ii) of Sub-section (1G), the TCS shall continue to apply at the rate of 5% for the first Rs 7 lakhs per individual per annum; the 20% rate will only apply for expenditure above this limit. Increased TCS rates to apply from 1st October 2023

Anurag Singh Thakur, Minister of State, Ministry of Finance, in a written reply to Lok Sabha has said, “The closure of travel and tourism industry due to Covid-19 had a cascading effect on the livelihood of people dependent on tourism. Ministry of Tourism has engaged NCAER to conduct a study on ‘India and Coronavirus pandemic: Economic losses for household engaged in tourism and policies for recovery’.” he also stated that considering the challenges faced by tax-payers due to outbreak of covid-19, the government has taken several taxation measures to improve the liquidity in different sectors including tourism and hospitality.

Rupinder Brar, ADG, Tourism, has said that they are in touch with insurance providers and Ministry of Finance to look at possibilities of providing insurance to travellers coming into India. “We are studying international models to see how we can incentivise travellers to come to our country and offer a certain sense of security to aid the process,” she said.

Tarun Bajaj, Secretary, Department of Economic Affairs, Ministry of Finance, during a webinar organised by FHRAI, shared his view on moratorium extension and debt restructuring. He said, “Extending the moratorium is not a solution as it is only postponing it; it is better to get restructuring done so that you know what is to be paid and in how much time.”

The Principal Economic Advisor, Ministry of Finance, Sanjeev Sanyal, said during a webinar for FHRAI members, “We have, through the one-time loan restructuring option, offered to alleviate the financial burden on businesses. If for any reason this provision is not working, then the government wants to take your feedback and work on an action-plan to make it work. If this means that the banks, for some reason have displayed inhibition in co-operating with the businesses trying to avail of the government’s scheme, then we will take necessary action to rectify it.”

In today’s FHRAI webinar with Sanjeev Sanyal, Principal Economic Adviser, Ministry of Finance, Government of India suggested FHRAI to put forth their general problems along with other Associations like CII and FICCI. The main problem that Association addressed pertains to restructuring of loans and extending the moratorium period. They also said that onetime restructuring which was allowed till March 31 is not taken very seriously. Sanyal said that the restructuring guidelines addressed in KV Kamanth Committee will not be considered in a normal account, banks may not be taking the guidelines seriously but RBI is. Plus, he suggested that it is important to focus on the schemes that are already existing in the framework and push it forward. Association also requested that moratorium should continue until the situation is better and banks could get a solution. They also mentioned that Amitabh Kant is making some progress in deal with Saudi Arabia for a new credit line. To which Sanyal said that funds is not a problem, economy is doing good, there is liquidity in the market, the task is how to leverage it.

In a statement, the Outbound Tour Operators Association of India (OTOAI) said that the Ministry of Finance has deferred the implementation of the TCS amendments proposed in the Union Budget 2020-21 till 1st October 2020. Making amendments in the Finance Bill 2020 before getting in passed in the Lok Sabha, the Finance Minister decided to defer the implementation of the much talked about TCS provisions to charge 5 per cent income tax on the sale of overseas tour packages and foreign exchange remittances from the buyer by the virtue of Section 206C under the Income Tax Act. OTOAI further said it will continue this dialogue and strive for the complete rollback of TCS altogether by highlighting its adverse impact on Indian outbound operators and how it would render us uncompetitive given the competitive landscape which also includes foreign players. OTOAI will keep addressing various issues concerning overseas travel with the respective ministries for the benefit of the outbound tour operators and its members.

Rupinder Brar, Additional Director General, Ministry of Tourism, Government of India, has revealed that they have put forth the industry representation and requests in front of the Finance Minister, so that they can work towards reducing the impact of the COVID-19 outbreak on businesses. “The industry stakeholders need working capital and they are looking at interventions either from the banking sector in easing out of norms, or they will be looking at support through reduction of taxes. These are the things that would leave money in the hands of the industry as of now. We would be carrying out or taking with us the representation of the industry and the thrust would be that the industry needs to survive so that job losses do not happen. I would refer to the honourable PM’s speech to the nation, where he has himself mentioned that we should make sure that we don’t stop wages of anyone. Hence, all the efforts of the Ministry of Finance would be to ensure that no such job losses happen in the tourism and hospitality sectors.”

The team of Outbound Tour Operators Association of India (OTOAI), recently met Kamlesh Varshney, Joint secretary, TPL, Ministry of Finance, to apprise him of situations arising currently on tourism industry because of TCS. In a statement by the association, it was mentioned, “We requested that TCS be not implemented and deferred in present situation. He assured that our request will be positively looked into and they would consider our request of rolling back of the law, and if rollback is not possible then deferment will be considered.” Riaz Munshi, President, OTOAI; Shravan Bhalla, Gen. Secretary; Guldeep Singh Sahni, Former President and Rajeev Sabharwal, Former Treasurer, met the Joint Secretary to voice their concerns.

The Ministry of Finance announced December 27, 2017 as the late date for filing the TRAN-1 form under the Goods and Services Tax (GST) to avail input tax credit. The Ministry, in a release, informed that a taxpayer could file Form TRAN-1 and avail input tax credit on the basis of closing balance of the input tax credit declared in the last return under the pre GST regime. In keeping with the philosophy of voluntary compliance, revision of Form TRAN-1 has also been provided. The last date for revision of TRAN-1 is also December 27. The Ministry noted that some taxpayers have availed extraordinarily high transitional credit of CGST. Such behaviour leads to breach of trust between the taxpayer and the tax-administration, the release said. Taxpayers who have claimed transitional credit erroneously are advised to avail of the opportunity to revise Form TRAN-1 within the deadline, failing which the tax administration would be constrained to initiate audit and enforcement action against the identified units, the release mentioned.