Coal Mionister Jaiswal opposes govt on jewellery duty hike

 In what could be a big embarrassment to the UPA government, senior Congress leader and Coal Minister Sriprakash Jaiswal has slammed that the excise duty hike announced by Finance Minister Pranab Mukherjee on jewellery in this year’s Union Budget.

Reports, Monday, claimed that Jaiswal made these remarks while attending a meeting in Kanpur where he expressed solidarity with the jewelers opposing the excise duty hike.

Reacting to the move, the Coal Minister even compared some government departments to mosquitoes that suck their blood.

"For only Rs 100 crore of revenue I realise how much you will have to go through. Like mosquitoes in the night, in our country there are some departments that also suck blood," he was quoted as saying.

Bullion and jewellery markets have strongly opposed the imposition of excise duty on unbranded jewellery and doubling of import duty on gold. Many jewellery shops have remained closed in various cities in protest.

Importantly, the All India Sarafa Association has also approached the Congress president and UPA chairperson Sonia Gandhi seeking her intervention in the matter.

Traders are protesting against the budget proposal imposing excise duty of 1% on unbranded precious jewellery and doubling of customs duty on standard gold bars and coins to 4%.

In a week after the Union Budget was tabled, sources claimed that the bullion and jewellery industry incurred a loss of over Rs 10,000 crore, including Rs 750 crore on the auspicious day of 'Gudi Padwa" in Mumbai alone.

Retail jewellers brought under the excise net by the recent budget proposal were more worried and requested shifting of duty to another form.

Traders have warned that imposition of higher levies may lead to a rise in retail gold prices by over 6% in the country, which is seeking to rein in a widening current account-deficit partly fuelled by record purchases in 2011.

All India Bullion and Jewellers' Association said the proposed excise duty on jewellery would affect the business and needs elaborate book-keeping which could be a cumbersome process for jewellers.

DTC Panel: Income tax exemption limit be raised to Rs 3 lakh per annum

Ahead of the Budget, a Parliamentary panel that scrutinised the Direct Taxes Code (DTC) Bill has suggested that income tax exemption limit be raised to Rs 3 lakh per annum, and the investment limit for tax savings schemes be hiked to Rs 3.20 lakh.

In its report, which was submitted to the Lok Sabha Speaker Meira Kumar today, the Standing Committee on Finance suggested that the wealth tax limit be pegged at Rs 5 crore, while the Securities Transaction Tax (STT) be abolished.

As regards the corporate tax, the Committee, which is headed by senior BJP leader and former Finance Minister Yashwant Sinha, recommended that the rate be retained at 30 per cent.

The report will pave the way for debate and passage of the DTC Bill, which seeks to replace the Income Tax Act, 1961, by Parliament.

Besides hiking the income tax exemption to Rs 3 lakh from Rs 1.8 lakh at present, the Standing Committee also suggested that 10 per tax be levied on taxable income between Rs 3-10 lakh, 20 per cent between 10-20 lakh and 30 per cent over Rs 20 lakh.

At present, 10 per cent tax levied on income between Rs 1.8-5 lakh, 20 per cent on income between Rs 5-8 lakh and 30 per cent above Rs 8 lakh.

The DTC has proposed income tax exemption limit at Rs 2 lakh, 10 per cent between Rs 2-5 lakh, 20 per cent Rs 5-10 lakh and 30 per cent above Rs 10 lakh.

With regard to tax savings scheme, the panel has proposed to raise the total tax exemptions limit under various scheme to Rs 3.2 lakh from existing Rs 1.8 lakh and Rs 2 lakh suggested by the DTC.

With regard to the wealth tax, the committee suggested that it should be levied only if the value of specified asset exceeds Rs 5 crore as against Rs 30 lakh currently and Rs 1 crore suggested by the proposed DTC Bill.

As regards the rate, it said, the wealth tax should be charged at 0.5 per cent on assets between Rs 5-20 crore, 0.7 per cent on assets between Rs 20-50 crore and 1 per cent above Rs 50 crore. The wealth tax rate now is 1 per cent.

The DTC Bill, which seeks to modernise the direct tax structure in the country, was referred to the Parliamentary Committee in August 2010.

The government, pending approval of the DTC Bill by Parliament, is likely to introduce some measures concerning taxes in the forthcoming Budget itself to be presented by Finance Minister Pranab Mukherjee in the Lok Sabha on March 16.

The Budget Session of Parliament will begin on March 12 with President Pratibha Patil addressing the joint sitting of Members of the Lok Sabha and the Rajya Sabha.

Highlights of the recommendations of Parliamentary Standing Committee on Direct Taxes Code:

* Raise I-T exemption limit to Rs 3 lakh from Rs 1.8 lakh
* Levy 10 pc tax on income between Rs 3-10 lakh
* 20 pc on income between Rs 10-20 lakh,30 pc above Rs 20 lakh
* Senior citizen benefits from 60 years instead of 65 years
* Raise tax rate on life insurance cos to 15 pc from 12.5 pc
* Retain corporate tax rate at 30 pc
* Remove Securities Transaction Tax (STT)
* Hike tax savings schemes limit to Rs 3.2 lakh,from Rs 1.8 L
* Raise wealth tax limit to Rs 5 crore from Rs 30 lakh