Latest Expert Exchange Queries

GST Demo Service software link: https://ims.go2customer.com
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
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) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
 
 
 
 
Popular Search: form 3cd :: Central Excise rule to resale the machines to a new company :: due date for vat payment :: ACCOUNTING STANDARDS :: list of goods taxed at 4% :: ACCOUNTING STANDARD :: articles on VAT and GST in India :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT Audit :: cpt :: TDS :: TAX RATES - GOODS TAXABLE @ 4% :: VAT RATES :: ARTICLES ON INPUT TAX CREDIT IN VAT :: empanelment
 
 
« Direct Tax »
 RBI releases draft directions on hedging of commodity price
 Unexplained deposits in focus, taxmen ordered to go all out in the next three months
 Why India’s corporate tax rate should be cut
 Best ways to save tax under section 80C
 Govt may exceed direct tax collection target of FY18 Budget estimates
 CBDT relaxes MAT provisions for companies under corporate insolvency
 CBDT relaxes norms for MAT on firms facing insolvency
  Income-tax deduction from salaries during the financial year 2017-18 under section 192 of the Income-tax Act, 1961
 CBDT to appeal for revival of certain deregistered companies
 How the new tax regime fared in India these last 6 months
 Income Tax Slab for AY 2017-18: Know your tax category

Fuel hike: Too little too late
June, 05th 2008

 The fuel price hike announced by the government is a clear case of too little too late. It covers less than 10% of the losses of oil companies, still leaving the fisc and the oil companies to bear the bulk of the burden.

Worryingly, the government has almost ruled out more price hikes if crude remains stable and has not indicated the course of action should crude prices rise, which is likely. Clearly, the intent is to limp along for the next twelve months and leave it to the next government to grapple with the issue.

At current international crude prices, the total under-recovery of oil marketing companies is estimated at Rs 2,45,305 crore for 2008-09. The product price increases petrol Rs 5/litre, diesel Rs 3/litre and LPG Rs 50/cylinder would yield only about Rs 21,000 crore. That the price hike only covers a fraction of the under-recovery of oil companies underscores the extent of mismanagement of the oil economy.

Having failed to revise prices periodically, the government found itself unable to pass on to the consumer even a quarter of the global oil price spike. Things got worse with the issue of inflation getting deeply politicised. It is the country and not the government that will now bear the cost of this political expediency.

Over 55% of the under-recovery is to be met through oil bonds of Rs 135,000 crore, a liability on the future. Public sector oil companies, upstream and marketing, have to pitch in with Rs 65,000 crore, again a tax on the nation. The only direct cost to this government, to the extent it constrains expenditure, is the Rs 22,600 crore foregone in tax revenues due to the reduction in excise and customs duty.

The only silver lining is that the oil marketing companies would have some breathing space. They would get an additional about Rs 44,000 crore through product price hike and reduction in various duties and the oil bonds that they receive from the government would be more liquid. Clearly, some sort of institutional arrangement is required to depoliticise the oil economy.

The government could make price revision legally mandatory, should global crude prices move up by a certain percentage. It should also address the issue of off-budget funding of consumer subsidies that have made a mockery of fiscal responsibility legislation.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - We Bring IT. Offshore software outsourcing company. We use Global Delivery Model (GDM) and believe in Follow The Sun principle

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