Apple to start India manufacturing in coming months with iPhone SE: Report

Apple's move comes as it seeks to boost its share in the world's fastest growing major mobile market

Apple Inc will in the coming months start assembling its lower-priced iPhone SE models at a contract manufacturer's plant in the technology hub of Bengaluru, an industry source with direct knowledge of the matter said on Friday.

Apple's Taiwanese manufacturing partner Wistron Corp is setting up a plant in Bengaluru to focus solely on assembling iPhones, a separate source told Reuters earlier this month.

Apple's move comes as it seeks to boost its share in the world's fastest growing major mobile market, where handsets far cheaper than Apple's iPhones dominate. It also comes as smartphone sales growth is slowing in Asia's other massive market, China.

To lower prices, Apple has been seeking to set up local production and has been in talks with the Indian federal government regarding issues such as tax concessions.

The industry source told Reuters the initial manufacturing of the iPhone SE model was not contingent on those concessions.

Apple did not immediately respond to a request for comment.

The Economic Times newspaper earlier on Friday reported Apple planned to initially assemble 300,000 to 400,000 iPhone SE handsets in India. The industry source told Reuters the numbers would be substantially lower to begin with.

The source also said it was too early to say what other phone models Apple would assemble at the Bengaluru plant. Read more

This is how India can reduce the size of its black economy

A deeper understanding of the economy is needed to figure put ways to deal with black economy

November 8, 2016 will be a memorable day for Indians in years to come. On this day, Prime Minister Narendra Modi eliminated more than 85% of Indian currency notes in circulation, wreaking havoc in common people’s lives. While the effects of this policy may take some time to unfold, will they include reduction in the size of black economy and corruption? To explore the answer to this question, it might be a good idea to look at what are the determinants of black economy and corruption.

Regulations and the Indian black economy

India has a substantial informal economy, or transactions and businesses that are not registered and cannot be taxed. This informal economy employs almost 75% of the total workforce in India but only contributes 20% to GDP. It is substantially less productive than the formal economy, though it provides a livelihood to a majority of Indians. Not all the transactions in this economy are illegal and most economic activities are undertaken by people and firms that belong to the unorganised sector. Acknowledging the meaningful differences between the terms ‘black economy’, ‘informal economy’ and ‘unorganised sector’, one common theme underlying these various categories is either blatant tax evasion (in the case of the black economy) or the government’s imperfect and sometimes harmful ability to tax transactions.

Almost all countries have some degree of black economy, prompting a significant amount of research on its causes and determinants. According to a survey of such literature by Friedrich Schneider and Dominik H. Enste (2000) and Friedrich Schneider (2016), the most important and often cited causes are:

Burden of taxes and social security contributions. Read more

20 things Jaitley changed in India through this budget

Income Tax investigators given more power & carbon traders get concessions

Budget 2017 : There were many things that Finance Minister Arun Jaitley said during his budget speech but there are many more that went unsaid. Here is a list of 20 things that could have a direct or indirect impact on your life:

• With regard to a foreign company, sale of leftover stock of crude oil in case of strategic petroleum reserve after the expiry of the agreement, subject to the fulfilment of certain conditions, shall not be liable to tax in India.
• In case of income arising from sale of carbon credit, a concessional tax rate of ten per cent will be given
• Government, foreign missions and state PSUs engaged in the passenger transport business will be exempted from Tax Collection at Source (TCS) provisions relating to purchase of vehicles.
• Conditions of special taxation regime for offshore funds under section 9A of the Income-tax Act has been modified. Now, maintenance of minimum fund size would not be necessary for the year in which the fund is being wound up.
• Income from Chief Minister’s Relief Fund or the Lieutenant Governor’s Relief Fund shall be exempted from tax.
• Certain entities like Investor Protection Funds, Core Settlement Guarantee Fund, Tea/Coffee/Rubber Boards, enjoying exemption from levy of income-tax under section 10 of the Income-tax Act, shall be required to furnish return of their income.
• In order to ensure timely filing of returns of income, it is proposed to levy a fee in case of delay in filing the return. Read more

Budget 2017 has sops for selling property but restrictions on buying

Holding period for long term capital gains tax brought down to two years from earlier three

Budget 2017 : Your tax liability would now be lower when you sell a house in the third year after purchase. You can now claim long term capital gains (LTCG), if you sell a house after holding it for two years from the date of completion. Earlier, one could claim LTCG only after a holding period of three years. The rate for LTCG tax usually works out to be lower compared to short term capital gains (STCG) tax.

LTCG is paid either at flat 10% or 20% after adjusting the property price for inflation. STCG is added to the income of the seller and taxed as per his income tax slab, which comes to 30% if the gains are Rs 10 lakh or more.

While announcing the move, Finance Minister Arun Jaitley said: “This move will significantly reduce the capital gain tax liability while encouraging the mobility of assets."

“The government seems to have made the changes to revive the property market that has suffered due to demonetisation,” says Rahul Garg, partner and leader direct tax, PwC.

Preeti Khurana, a chartered accountant with ClearTax, says that it was a surprise move to see the government giving sops for selling a house for a shorter holding period.

While the government has given relief for selling of property, it has brought down a benefit provided on buying a second house. The government has restricted the interest deduction for second home that buyers get under Section 24. Read more

Highways allocation stepped up to Rs 64,000 crore: Arun Jaitley

'For transport sector -- railways, road, shipping, govt provides Rs 2,41,000 cr,' Jaitleysaid

Budget 2017 : Finance Minister Arun Jaitley on Wednesday announced enhancing the outlay for National Highways by 11 per cent to Rs 64,000 crore for 2017-18.

Presenting the Budget in Parliament on Wednesday, Jaitley said, "In the road sector, I have stepped up the budget allocation for the National Highways from Rs 57,676 crore in the budget estimate of 2016-17 to Rs 64,000 crore in 2017-18."

"For transport sector, including railways, road and shipping, government provides Rs 2.41 lakh crore," he added.

Jaitley said 2,000 km of coastal connectivity roads have been identified for construction and development. This will facilitate better connectivity of ports and remote villages, he said.

"The total length of roads including those under the PMGSY built from 2014-15 to current year is about 1,40,000 km, which is significantly higher than the previous three years," Jaitley said.

He said 133-km roads per day were constructed under the Pradhan Mantri Gram Sadak Yojana (PMGSY) as against 73-km in 2011-14.

Budget relief to middle class, 5% income tax for Rs 2.5-5 lakh earners

However, earners in between Rs 50 lakh and Rs one crore will have to pay 10% surcharge

The Budget gave relief to on personal income tax front, mainly the salaried group in the middle class, by halving the tax to five per cent up to the income of Rs 5 lakh to ease the pains of demonetisation. However, those earning above Rs 50 lakh and up to Rs one crore will have to shell out additional 10 per cent surcharge.

The cut in the tax rate for the lowest slab will also save up to Rs 12,500 for incomes in other slabs, increasing disposable income of the middle class that can provide spur to the slowing down economic growth. The present super rich tax in the form of 15 per cent surcharge will remain for those earning income over Rs one crore.

The finance minister also put more money in the hands of small and medium enterprises by reducing the corporate tax rate to 25 per cent from the current 30 per cent for annual turnover up to Rs 50 crore. Ninety six per cent of companies which file returns come under this category.

Besides middle class and SMEs, the finance minister also addressed the concerns of foreign portfolio investors by exempting India-based funds them from the indirect transfer provisions. The government had put on hold the recent rules by the Central Board of direct taxes in this regard.

Budget 2017 News, India Union Budget 2017-18, Latest News & Stories, Live Updates, Headlines & Highlights for Budget 2017-2018 | Business Standard

Big relief to middle class! I-T rate for Rs 2.5 lakh to Rs 5 lakh annual income bracket halved to 5%

The Foreign Investment Promotion Board (FIPB) has been decided to be abolished, Finance Minister Arun Jaitley declared in his budget presentation on Tuesday.

While, the FIPB had the final say in approving Foreign Direct Investment (FDI) proposals in the country for long, its power has been systematically reduced under the current government. Most notably, back in June, 2016 the government had announced relaxed FDI norms in single brand retail, civil aviation, airports, pharmaceuticals, animal husbandry and food products.

It had allowed up to 100% FDI in defence through the approval route, 100 per cent FDI in food product e-commerce, 100 per cent FDI in greenfield pharma via the automatic route, 100% in browfield pharma — of which 74% will be through automatic route — 100 per cent FDI in scheduled airlines, and up to 49 per cent FDI in airlines through automatic route.

In the last two years, the government has brought major FDI policy reforms in a number of sectors, including defence, construction development, insurance, pension sector, broadcasting sector, tea, coffee, rubber, cardamom, palm oil tree and olive oil tree plantations, single brand retail trading, manufacturing sector, limited liability partnerships, civil aviation, credit information companies, satellites - establishment/operation and asset reconstruction companies.

Incoming FDI grew 27 per cent in the first seven months of the fiscal to $27.82 billion, from $21.87 billion a year ago. Manufacturing accounted for 41.5 per cent of the total equity inflows into the country during April-October, according to the Department of Industrial Policy and Promotion’s (DIPP) year-end review.

This happened at a time when the government made a fervent pitch abroad for ‘Make in India’ to make India a manufacturing hub of the world and generate large scale employment. Services, telecom, trading, computer hardware and software and automobiles were among the major sectors that attracted FDI during this period. Read more

• Big relief to middle class! I-T rate for Rs 2.5 lakh to Rs 5 lakh annual income bracket halved to 5%
• India Budget 2017-2018 | India Union Budget 2017-2018 News, Analysis, Budget 2017-2018 Highlights - Business Standard News
• Budget 2017 News, India Union Budget 2017-18, Latest News & Stories, Live Updates, Headlines & Highlights for Budget 2017-2018 | Business Standard