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Guidance Note for implementation of Foreign Account Tax Compliance Act (FATCA)



Based on comments and feedback received, the Guidance Note for implementation of Foreign Account Tax Compliance Act (FATCA) and Common Reporting Standard (CRS) updated 
An Inter-Governmental Agreement between India and USA was signed for implementation of Foreign Account Tax Compliance Act (FATCA). The Government of India has also joined the Multilateral Competent Authority Agreement (MCAA) for Automatic Exchange of Information as per Common Reporting Standard (CRS). 


For implementation of FATCA and CRS, necessary legislative changes have been made in the Income-tax Act, 1961 and Income-tax Rules, 1962. Rules 114F, 114G & 114H and Form 61B have been inserted to provide legal basis for the Reporting Financial Institutions (RFIs) for maintaining and reporting information about the Reportable Accounts.

A Guidance Note was released on 31st August 2015 for ensuring compliance with the reporting requirements provided in Rules 114F to 114H and Form 61B of the Income-tax Rules, 1962. Based on comments and feedback received, this Guidance Note has been updated on 31st December 2015. The same has been placed on the Income-tax website http://www.incometaxindia.gov.in. 
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Calendar for Auction of Government of India Treasury Bills for the Quarter ending March 2016 notified 


After reviewing the cash position, the Government of India, in consultation with Reserve Bank of India (RBI), has decided to notify the amounts for the issuance of Treasury Bills for the quarter ending March 2016 as under:
Notified Amount for Auction of Treasury Bills
(January 1, 2016 to – March 31, 2016)
 (Rs. in Crore)
Date of Auction
91 Days
182 Days
364 Days
Total
January 06, 2016
9,000
    
6,000
15,000
January 13, 2016
9,000
6,000

15,000
January 20, 2016
9,000

6,000
15,000
January 27, 2016
9,000
6,000

15,000
February 03, 2016
9,000

6,000
15,000
February 10, 2016
9,000
6,000

15,000
February 17, 2016
9,000

6,000
15,000
February 24, 2016
8,000
6,000

14,000
March 02, 2016
8,000

6,000
14,000
March 09, 2016
8,000
6,000

14,000
March 16, 2016
8,000

6,000
14,000
March 23, 2016
8,000
6,000

14,000
March 30, 2016
8,000

6,000
14,000
Total
1,11,000
36,000
42,000
1,89,000


            The Government of India/Reserve Bank of India (RBI) will continue to have the flexibility to modify the notified amount and timing for auction of Treasury Bills depending upon the requirements of the Government of India, evolving market conditions and other relevant factors. Thus, the calendar is subject to change, if circumstances so warrant including for reasons such as intervening holidays. Such changes, if any, will be communicated through regular press releases.

            The auction of Treasury Bills will be subject to the terms and conditions specified in the General Notification No. F2(12)-W&M/97 dated March 31, 1998 issued by the Government of India, as amended from time to time.

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Change in Tariff Value of Crude Palm Oil, RBD Palm Oil, others – Palm Oil, Crude Palmolein, RBD Palmolein, others – Palmolein, Crude Soyabean Oil, Brass Scrap (All Grades), Poppy Seeds, Areca Nuts, Gold and Silver Notified 
In exercise of the powers conferred by sub-section (2) of Section 14 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise & Customs(CBEC), being satisfied that it is necessary and expedient so to do, hereby makes the following amendment in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 36/2001-Customs (N.T.), dated the 3rd August, 2001, published in the Gazette of India, Extraordinary, Part-II, Section-3, Sub-section (ii), vide number S. O. 748 (E), dated the 3rd August, 2001, namely:-
In the said notification, for TABLE-1, TABLE-2, and TABLE-3, the following Tables shall be substituted namely:-

TABLE-1

Sl. No.
Chapter/ heading/ sub-heading/tariff item
Description of goods
Tariff value US $(Per Metric Tonne)
(1)
(2)
(3)
(4)
1
1511 10 00
Crude Palm Oil
                        557
2
1511 90 10
RBD Palm Oil
  581
3
1511 90 90
Others – Palm Oil
569
4
1511 10 00
Crude Palmolein
595
5
1511 90 20
RBD Palmolein
598
6
1511 90 90
Others – Palmolein
597
7
1507 10 00
Crude Soya bean Oil
733
8
7404 00 22
Brass Scrap (all grades)
2904
9
1207 91 00
Poppy seeds
2722

TABLE-2
Sl. No.
Chapter/ heading/ sub-heading/tariff item
Description of goods
Tariff value
(US $)
(1)
(2)
(3)
(4)
1
71 or 98
Gold, in any form, in respect of which the benefit of entries at serial number 321 and 323 of the Notification No. 12/2012-Customs dated 17.03.2012 is availed
345 per 10 grams
2
71 or 98
Silver, in any form, in respect of which the benefit of entries at serial number 322 and 324 of the Notification No. 12/2012-Customs dated 17.03.2012 is availed
452 per kilogram 

TABLE-3
Sl. No.
Chapter/ heading/ sub-heading/tariff item
Description of goods
Tariff value
(US $ Per Metric Tons )
(1)
(2)
(3)
(4)
1
080280
Areca nuts
2558”

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Amendment of Rules regarding quoting of PAN for specified transactions to come into force from 1st January, 2016 
The Government is committed to curbing the circulation of black money and widening of tax base. To collect information of certain types of transactions from third parties in a non-intrusive manner, it is mandatory under Rule 114B of the Income-tax Rules to quote PAN where the transactions exceed a specified limit. In case of transactions of sale or purchase of goods and services, PAN will be required to be quoted, irrespective of the mode of payment if the transaction exceeds Rs. two lakhs.
            To bring a balance between burden of compliance on legitimate transactions and the need to capture information relating to transactions of higher value, the Government has amended Rule 114B to enhance the monetary limits of certain transactions which require quoting of PAN.
                        The changes made to the Rules have been notified through S.O. No. 3545(E) dated 30th December, 2015. These changes will take effect from 1st January, 2016.
                        The Notification is available on the website of the Department www.incometaxindia.gov.in.

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CBDT issues instructions to streamline Scrutiny Assessment Proceedings and to facilitate Electronic Communication ; Another step in providing fair and transparent tax administration and improved taxpayer services 
The Income Tax Department is committed to providing fair and transparent tax administration and continuously improve taxpayer services.
Taking another step in this direction, Central Board of Direct Taxes (CBDT), Ministry of Finance has issued instructions to the assessing officers to be specific in enquires made in the case of tax payers whose returns are under scrutiny.  The directions are comprehensive and cover cases selected through Computer Aided Scrutiny Selection (CASS) for limited scrutiny for verification of information contained in Annual Information Return (AIR)/ Form no 26AS or received through Central Information Branch, or complete scrutiny.  The assessing officers have been advised to inform the assessee forthwith of the reasons for limited scrutiny, confine enquiries on the specific points for which the case has been selected and conclude the proceedings expeditiously in a limited number of hearings. Cases selected for limited scrutiny can be converted to complete scrutiny only with the approval of the Principal Commissioner of Income Tax/ Commissioner of Income tax if the potential income escaping assessment exceeds a certain monetary limit. In all cases the initial notice will be accompanied with a specific questionnaire.  Any addition to income or disallowance of deductions will be made only after following due process of natural justice.
The Department has also initiated a pilot project for carrying out an e-mail based scrutiny assessment in select cases of non-corporate charges at Delhi, Mumbai, Bengaluru, Ahmedabad and Chennai.  Through this pilot, the Department endeavours to completely remove the need for the taxpayer to visit the offices of the Department while moving towards paperless scrutiny assessment proceedings.
Separately, the CBDT has directed all its officers to mention e-mail address and phone numbers in all communications to facilitate electronic interface of the taxpayer with the Department. 
These recent measures are steps towards obviating the need for avoidable personal interface with the Department and ushering in a non-adversarial tax regime.  
The communications issued by CBDT are available on the website of the Department at www.incometax.gov.in
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Quarterly Report of India’s External Debt at end-September 2015 released; India’s External Debt at end-September 2015 stood at US$ 483.2 billion, recording an increase of US$ 8.0 billion (1.7 per cent) over the level at end-March 2015; Rise in external debt during the period was due to long-term external debt particularly commercial borrowings and NRI deposits 
Department of Economic Affairs, Ministry of Finance, Government of India has been compiling and releasing quarterly statistics on India’s External Debt for the quarters ending September and December every year. Now it has released Report on India’s External Debt as at end-September 2015.

The complete Quarterly Report of India’s External Debt at end-September 2015 is available on the website of Ministry of Finance –www.finmin.nic.in.

At end-September 2015, India’s external debt stock stood at US$ 483.2 billion, recording an increase of US$ 8.0 billion (1.7 per cent) over the level at end-March 2015. The rise in external debt during the period was due to long-term external debt particularly commercial borrowings and NRI deposits. However, on a sequential basis, total external debt at end-September 2015 declined by US$ 291 million from the end-June 2015 level.

Long-term debt at end-September 2015 was placed at US$ 397.1 billion, showing an increase of US$ 7.4 billion (1.9 per cent) over the level at end-March 2015. Short-term external debt witnessed an increase of 0.7 per cent and stood at US$ 86.1 billion at end-September 2015.

At end-September 2015, long-term external debt accounted for 82.2 per cent of India’s total external debt, while the remaining (17.8 per cent) was short-term external debt. Component-wise, the share of commercial borrowings stood highest at 37.7 per cent of total external debt, followed by NRI deposits (25.2 per cent) and multilateral debt (11.0 per cent).

Government (sovereign) external debt stood at US$ 88.9 billion at end-September 2015 while non-Government debt amounted to US$ 394.3 billion. The shares of Government (Sovereign) and non-Government debt in the total external debt were 18.4 per cent and 81.6 per cent respectively, at end-September 2015.

The share of US dollar denominated debt continued to be the highest in external debt stock at 57.7 per cent at end-September 2015, followed by the Indian rupee (28.3 per cent), SDR (5.8 per cent), Japanese yen (4.0 per cent), and euro (2.4 per cent).

The ratio of concessional debt to total external debt was 8.7 per cent at end-September 2015 (8.8 per cent at end-March 2015).

India’s foreign exchange reserves provided a cover of 72.5 per cent to the total external debt stock at end-September 2015 vis-à-vis 71.9 per cent at end-March 2015.

The ratio of short term external debt to foreign exchange reserves was 24.6 per cent at end-September 2015 as against 25.0 per cent at end-March 2015.


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Government of India puts Medium-Term Debt Management Strategy (MTDS) in public domain; MTDS document contains the objectives and risk analysis of the Government borrowings and strategy to be followed 
The Government of India, in consultation with the Reserve Bank of India (RBI), has placed in public domain Medium-Term Debt Management Strategy (MTDS). The strategy has been articulated for a period of three years (2015-16 to 2017-18). The strategy document contains the objectives, risk analysis of Government borrowings and strategy to be followed. MTDS is in consonance with the Medium-Term Fiscal Policy Statement (MTFPS). MTDS has been prepared based on sound international practices and taking into account the domestic economic and financial conditions.
MTDS would be updated on an annual basis to reflect the emergent conditions. The complete MTDS document is also attached here with for ready reference and record.

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