Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: ACCOUNTING STANDARDS :: due date for vat payment :: VAT RATES :: ACCOUNTING STANDARD :: TDS :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4% :: list of goods taxed at 4% :: articles on VAT and GST in India :: Central Excise rule to resale the machines to a new company :: cpt :: empanelment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT Audit
 
 
Direct Tax »
 CBDT signifies achievements towards eliminating domestic black money
 Seafarers get tax exemption from Ministry of Finance
 Financial institutions need to get accounts self-certified for FATCA by April 30
 Direct tax incentives to promote start-ups
 Employer didn't deposit the TDS it deducted on your salary. How to claim it?
 Central Board of Direct Taxes clarifies on cash curb, Aadhaar
 CBDT to issue PAN, TAN within a day to improve Ease of Doing Business
 Expats who stayed in India for 182 days or more must apply for Aadhaar card: CBDT
 CBDT accomplishes direct taxes collection target for FY 2016-17
  No relief to those who defaulted on 1st IDS installment: CBDT
 New Income Tax forms: What information is being asked for? All you want to know about the new rules

Govt should tax crude imports instead of raising tariffs
November, 07th 2012

The finance ministry is reportedly looking at raising customs and excise duties on sundry commodities whose tariffs are below the peak rate to shore up revenues. This is a bad idea. Such random changes would yield sub-optimal results and could distort the tax structure.

Instead, the government should simply impose a 2.5% import duty on crude and bring it on par with the duty on products. Duty-free crude only serves to beef up refining margins. Oil refiners should earn their profits from operational efficiency, not from tariff protection. Clearly, import duty on crude would lower the huge levels of effective protection that minimal value addition in refining enjoys and also generate much-needed revenue.

The price of the Indian basket of crude, which stood at around $113.64 a barrel in the first half of September, dropped to $109 per barrel by end-October and further to $106.3 per barrel on November 2. The drop in prices, though not steep, makes it easier for the government to levy import tariff without undue harassment of either the end-consumer or the oil companies.

The duty would boost revenues significantly, given that imports account for about 84% of the country's oil consumption and is the single-largest item of import. The government should also decontrol diesel prices and throw fuel retail open. Private refiners and stand-alone, independent retailers would compete with established oil marketing companies to rein in fuel prices.

And the new retail business would also compensate private refiners for thinner refining margins owing to the import duty on crude. Indirect tax collections grew at 15.6% during April-September this year against the Budget target of 27% due to the economic slowdown. The larger point is that the economy must revive for tax collections to improve.

So, the government should boost investment to revive growth. The Centre and states should also move swiftly to the proposed goods and services tax, even if the design is not perfect. Revenues will become buoyant once all production is captured under the tax net. Strengthening competition is another way to boost growth and revenue.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Desktop Application Development Outsourcing Desktop Application Development Offshore Desk

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions