Latest Expert Exchange Queries

Make 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) | 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: VAT Audit :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: TDS :: VAT RATES :: list of goods taxed at 4% :: ACCOUNTING STANDARD :: ACCOUNTING STANDARDS :: Central Excise rule to resale the machines to a new company :: articles on VAT and GST in India :: TAX RATES - GOODS TAXABLE @ 4% :: form 3cd :: due date for vat payment :: cpt :: empanelment
 
 
Service Tax »
  Central Goods and Services Tax (CGST) Rules, 2017
 Goods bought with loyalty points will face tax under GST
 substitution of Service Tax by Goods and Services Tax (GST)
 Income Tax: TDS deducted but ITR not filed? Here's what professionals need to do
 9 ways GST could impact home buyers
 Consumers hailed GST, but there's need for awareness'
 Tax departments keep a close watch on prices post GST rollout
 GST effect: 5 things that changed after the new tax regime
 GST is no game changer for farmers, yet
 GST: Government bets big on tech to ensure e-way bill does not bring back inspector raj
 Government to keep an eye on price rise & GST glitches

Shipping industry seeks cut in taxes
July, 08th 2008

The objective of imposing a tonnage tax instead of corporate tax on the Indian shipping industry may have been lost. A host of new taxes including fringe benefit tax (FBT) and service tax have increased the tax payouts of shipping companies diluting the benefits of shifting from a corporate tax regime to a tonnage tax regime.

Under the tonnage tax system, shipping companies pay a 3% tax on book profits as opposed to the earlier system of a 33% corporate tax.

The shipping ministry has asked the finance ministry to reduce service tax and FBT. It has also asked the ministry to withdraw the corporate tax on tonnage tax reserve a fund mandated by the government for fleet expansion and modernisation.

Even though the industry is supposed to pay 3% tonnage tax, it lands up paying 9% tax due to FBT and service tax which contribute additional 5-6%.

The government had introduced tonnage tax in India in 2004 in line with international practices replacing the corporate tax structure and reducing the tax liability of the industry.

However, it had made it mandatory for the industry to pool in 20% of its book profits towards a reserve for fleet expansion and modernisation called the tonnage tax reserve. The industry wants that there should not be any corporate tax on this contribution.

One major drawback of this is that even in loss making years, the industry has to make a set contribution to the fund, a shipping analyst said.

In other words the very purpose of introducing tonnage tax for giving Indian shipping companies a level playing field seems to have been defeated. Even tonnage tax in India is higher at 3% vis--vis 1-2% across the globe.

In addition, the government charges a minimum alternate tax (MAT) on profit from sale of ships. Since buying and selling of ships is an integral part of the business, the industry has been pleading for treating this income as part of tonnage tax income and therefore paying tonnage tax.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Software Development Software Programming Software Engineering Custom Software Development Requirement Based Software Development Software Solutions Software Serv

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