Policy Advocacy
Karnataka Government notifies Karnataka Maternity Benefit (Amendment) Rules 2019
The Government of Karnataka has notified the Karnataka Maternity Benefit (Amendment) Rules 2019 pertaining to Creche facilities. The Rules are applicable to commercial establishment with 50 or more employees in the State. They have come into effect from August 8th 2019. Following are some of the key provisions of the Rules: Distance Criteria – The Rules mandates every establishment to provide and maintain Creche facility either in the premises or within 500 meter distance from the entrance gate of the establishment to children upto 6 years of age One Creche for every 30 children: The Rules also mandates that there shall be one Creche for every 30 children Working Hours: The operating hours of the Creche shall corresponds to the working hours of the parents of the children. Medical checkup...
Policy Update: Finance Ministry introduces digital KYC under PMLA
Context The Ministry of Finance (Department of Revenue) has introduced digital KYC (know your customer) by amending the Prevention of Money-laundering (Maintenance of Records) Rules, 2005, it said in a gazette notification dated 19 August 2019. “digital KYC means the capturing live photo of the client and officially valid document or the proof of possession of Aadhaar, where offline verification cannot be carried out, along with the latitude and longitude of the location where such live photo is being taken by an authorised officer of the reporting entity,” the notification said. The move comes as a major relief for the fintech industry as no cost effective, scalable and customer friendly alternative digital KYC method was available to them, until now. Post the Supreme Court judgment on Aa...
Committee Report on New Direct Tax Code
On August 19, 2019, task force headed by Akhilesh Ranjan, Member, Central Board of Direct Taxes (CBDT) submitted its report to Finance Minister Nirmala Sitharaman. This is a significant development as the report seeks to replace 57-year old Income Tax Act, 1961 which has undergone innumerable incremental changes over time. The report has not yet been released in public. Based on our primary research, the key recommendations of the task force are as follows: Common Corporate Tax Rate for Foreign & Domestic Companies: Reduction in corporate tax rate for all domestic and foreign companies to 25% from 30% for large domestic companies and 40% for foreign companies. The government has already exceeded the timeline for this and it would be interesting to see if this suggestion would now only ...
Nasscom’s Recommendations on Promoting R&D Ecosystem for IT & BPM Industry in India
Nasscom recently submitted its recommendations to the Office of the Principal Scientific Adviser (PSA) on promoting R&D ecosystem for IT & BPM industry in India. Please find below the key highlights from our recommendations: India’s Research and Development (R&D) should focus on the following technologies over the next five to 10 years. Internet of Things (IoT), Cloud computing, Artificial Intelligence (AI), Fifth Generation wireless (5G) Distributed Ledger Technology (DLT), Renewal energy, Rechargeable batteries The R&D efforts in the above should broadly prioritise solutions in: Agriculture Health Mobility The R&D benefits/concessions given by the Indian government to the industry should benchmark with incentives available to the industry in other countries like the U...
Sabka Vishvas (Legal Dispute Resolution) Scheme, 2019
The Finance Minister in her maiden budget introduced Sabka Vishwas (Legacy Dispute Resolution) 2019 (LDRS) in order to “unload the baggage of more than INR 3.75 lakh crores blocked in litigation in service tax and excise and allow the business to move on”. This will allow quick closure of pre-GST litigation. The objective of the scheme is to provide one time measure for liquidation of past disputes of Central Excise and Service Tax and also to provide an opportunity of voluntary disclosure to non-compliant taxpayers. Effective Date of LDRS: The effective date will be notified in the official Gazette. Application procedure: Applications/ declarations to opt for the scheme need to be made on the CBIC portal (https://cbic.gst.gov.in); Benefits of the Scheme are as follows: Total waiver of int...
Policy Update: RBI changes NEFT timings, expands the scope of BBPS, among others
Context On 7 August, the Reserve Bank of India (RBI) announced a slew of policy measures aimed at accelerating the adoption of digital payments in the country. These include, revision of National Electronic Funds Transfer (NEFT) timings to make it a 24×7 facility, expanding the scope of utility bill payments and encouraging more entities to enter the retail payments space. The Central Bank has also proposed to set up a Central Payments Fraud Information Registry in a bid to improve the confidence of customers in the digital payment systems. “In order to carry forward these efforts and ensure quick and systemic responses, it is proposed to facilitate the creation of a Central Payment Fraud Registry that will track these frauds. Payment system participants will be provided access to thi...
CBDT Clarification on start-up companies’ assessment involving Sec 56(2)(viib) issue
CBDT has recently issued Circular No. 16/2019 dated August 7, 2019 providing clarification on assessment of start-up companies involving application of Section 56(2)(viib) of the Income Tax Act, 1961. The clarification provides procedure with regard to assessment of such startup entities: Start-ups recognized by Department for Promotion of Industry and Internal Trade (DPIIT) and the case is selected under ‘limited scrutiny’ on single issue of application of Sec 56(2)(viib) – No verification will be done by Assessing Officers (AOs) during proceedings u/s 143 (3)/147 and contention of such recognized start-ups on the issue will be summarily accepted. Recognized start-up case selected under “limited scrutiny” with multiple issues or under “complete scrutiny...
Member Consultation: Draft e-Commerce Guidelines for Consumer Protection 2019
On 2 August, the Department of Consumer Affairs under the Ministry of Consumer Affairs, Food & Public Distribution, issued draft guidelines on e-commerce for protection of consumers’ interest. It proposes a slew of consumer safeguards that forbid e-commerce companies from influencing pricing, adopting unfair promotion methods or misrepresenting the quality of goods and services. Earlier this year, in a move to help hundreds of thousands of small businesses and domestic sellers, the government imposed new e-commerce FDI rules from 1 February, banning online retailers from selling products of companies, wherein they own stakes and restricting them from entering into exclusive merchandise deals. The recent move to regulate the e-commerce companies comes at a time when a comprehensive e-co...
Policy Brief: Draft e-Commerce Guidelines for Consumer Protection 2019
Context On 2 August, the Department of Consumer Affairs under the Ministry of Consumer Affairs, Food & Public Distribution, issued draft guidelines on e-commerce for protection of consumers’ interest. It proposes a slew of consumer safeguards that forbid e-commerce companies from influencing pricing, adopting unfair promotion methods or misrepresenting the quality of goods and services. “These are issued as guiding principles for e-commerce business for preventing fraud, unfair trade practices and protecting the legitimate rights and interests of consumers. These Guidelines apply to the Business-to-Consumer e-Commerce, including goods and services, which also include digital contents products,” said the draft Model Framework for Guidelines on e-Commerce for consumer protection, which h...
Requesting inputs on Consultation Paper on E-invoicing under GST
As you might be aware, the GST Council in its 35th meeting held on June 21, 2019 had decided to introduce Electronic invoice (E-invoice) on voluntary basis from January 2020. The new system will lead to one-time reporting on B2B invoice. This will lead to substantial reduction in input credit verification issues as same data will get reported to tax department as well as to the buyer. In view of this, the Goods and Service Tax Network (“GSTN”) has released a public consultation paper on E-invoice standards to be used under GST System for industry feedback / comments. As per the concept note, the GSTN, in partnership with Institute of Chartered Accountants of India (“ICAI”), has drafted an e-invoice standard, which takes into account the requirement under tax laws and has features which are...
