Revision of Interest Rate



Revision of Interest Rate 

Interest rates on Small Savings Schemes are Administered Interest Rates, and are benchmarked to the average annual yield on Government Securities of comparable maturity in the secondary market with a suitable spread over the benchmark yield, depending upon the maturity and liquidity of the instruments. The interest rates of Small Savings Schemes have been benchmarked to G-Sec. yields of equivalent maturity with suitable spread and are reset every 1st April.


Interest rates applicable on each Small Savings Scheme w.e.f. 1.4.2014 are as below:
Instrument
Rate of Interest (%) w.e.f 1.4.2014
Savings Deposit
4.0
1 Year Time Deposit
8.4
2 Year Time Deposit
8.4
3 Year Time Deposit
8.4
5 Year Time Deposit
8.5
5 Year Recurring Deposit
8.4
5 Year SCSS
9.2
5 Year MIS
8.4
5 Year NSC
8.5
10 Year NSC
8.8
PPF
8.7

This was stated by Shri Jayant Sinha, Minister of State in Ministry of Finance in written reply to a question in the Lok Sabha today.

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Agreement on FDI 

Foreign Direct Investment (FDI) in India is governed by the FDI Policy announced by the Government of India and the provisions of the Foreign Exchange Management Act (FEMA), 1999. Details of inflow of FDI during each of the last three years and current year is available on the website of Department of Industrial Policy & Promotion (www.dipp.nic.in ->Publications -> FDI Statistics). 

¬ Under the Automatic Route, the foreign investor of the Indian company does not require any approval from the Reserve Bank of India or the Government of India for the investment. Under the Government Route, prior approval of the Government of India is required. Proposals for the foreign investment under Government route are considered by Foreign Investment Promotion Board (FIPB). 

The sector wise details of the proposals approved by FIPB in the past three years is available on the website of Foreign Investment Promotion Board (www.fipbindia.com •> Approved Cases -> All approved cases). The details of the proposals under consideration are at https://finminapp.nic.in/fipbweb/Fipbwebreports/webpage.asp. 

This was stated by Shri Jayant Sinha, Minister of State in Ministry of Finance in written reply to a question in the Lok Sabha today. 

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Attachment of Properties Against Tax Arrears 

Total amount of direct taxed arrear demand as on 31.10.2014 is Rs. 6,15,295 crore. An amount of Rs. 23,653 crore has been collected/recovered during the period 1.4.2014 to 31.10.2014. 

The target for cash collection out of arrear demand by the field authorities for the FY 2014-15 has been fixed at Rs. 41,997 crore. Out of the total arrear demand as above, demand of Rs. 5,82, 106 crore has been categorized as being difficult to recover, as on 31.10.2014. 

Income-tax Act, 1961 gives the power to the Assessing Officers/Tax Recovery Officers to attach the properties, movable or immovable, in appropriate cases of tax defaulters. It also empowers the Central Government to publish the names of the tax-defaulters, if it considers necessary or expedient in the public interest and in accordance with the prescribed guidelines. 

Total amount of tax arrears outstanding, as on 31.10.2014, against notified persons under the Special Court (Trial of Offences relating to Securities) Act, 1992 is Rs. 36, 254 crore. The Central Government appoints the Custodian/s, for the purposes of the said Act, who is/are empowered to notify the persons to be covered under this Act. All properties, movable or immovable or both, are attached simultaneously with the issue of the notification. Any recovery of tax arrears in case of these notified persons is made through the office of the Custodian/s, Income-tax authorities regularly follow up with the Special Court in matters of recovery of tax demand in such cases. 

This information was given by the Minister of State of Finance, Shri Jayant Sinha in written reply to a question in Lok Sabha today. 

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Concept of Retrospective Taxation 

Retrospective taxation means bringing changes in the legislation which impact the tax consequences of certain actions undertaken before the enactment of such legislation. 

The policy of the Government in respect of retrospective taxation has been spelt out in the speech of the Finance Minister while present the Finance (No.2) Bill, 2014 in the Lok Sabha on 10.7.2014 wherein it was stated that: 

The Government will not ordinarily bring about any change retrospectively which creates a fresh liability; 

Cases which have come up in various courts and other legal fora consequent upon certain retrospective amendments to the Income-tax Act, 1961 undertaken through the Finance Act, 2012 are at different stages of pendency and will naturally reach their logical conclusion; and 

All fresh cases arising out of the retrospective amendments of 2012 in respect of indirect transfers and coming to the notice of the Assessing Officers will be scrutinized by a High Level Committee to be constituted by the CBDT before any action is initiated in such cases. 

Government has constituted a three member Committee of officers by order dated 28.8.2014 under Section 119 of the Income-tax Act, 1961 for approval of the action to eb initiated by the Assessing Officer in fresh cases arising out of retrospective amendments of 2012 in respect of indirect transfer of assets. 

The Committee is required to submit its first report in respect of references decided by it for the period ending 31.12.2014. 

This information was given by the Minister of State of Finance, Shri Jayant Sinha in written reply to a question in Lok Sabha today. 

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Kisan Vikas Patras Reintroduced to Boost Small Savings 

To address decline in small savings and improve returns to small savers, Government has proposed to revitalize small savings. 

Kisan Vikas Patras have been reintroduced and notified. A scheme for Girl Child to cater to requirements of education and marriage have been notified. The Government has also enhanced annual investment ceiling on Public Provident Fund Scheme from Rs. 1.00 lakh to Rs. 1.50 lakh. 

Government is running ‘Senior Citizens Savings Scheme’. The rate of interest on small savings schemes has been aligned with the G-Sec rates of similar maturity, with a spread of 25 basis points (bps) with exception of Senior Citizens Savings Scheme. The spread on Senior Citizens Savings Scheme is 100 bps. 

This information was given by the Minister of State of Finance, Shri Jayant Sinha in written reply to a question in Lok Sabha today. 

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Revision of Interest Rate Revision of Interest Rate Reviewed by Ajit Kumar on 8:09 AM Rating: 5

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