Update on measures taken to simplify tax administration - Customs - C. No. CCU(DZ)Tech-I/10/15-16/1803

OFFICE OF THE CHIEF COMMISSIONER OF CENTRAL EXCISE DELHI C.R. BUILDING, I.P. ESTATE, NEW DELHI C. No. CCU(DZ)Tech-I/10/15-16/1803 Date : 02-05-2016 To The Principal Commissioner of Central Excise, Delhi-I/Gurgaon-II. The Commissioner of Central Excise, Delhi-II, Sonrpat(Delhi-III), Gurgaon-I Faridabad- I/II, Rohtak, Panchkula, Audit-I/II, LTU Madam/Sir, Subject : Update on measures taken to simplify tax administration-reg. Kindly find enclosed herewith copy of office memorandum under F. No. DP/PUB/08/16/684-726 dated 27-04-2016 .0f the Director General, DGTS, New Delhi, on the above subject enclosing a brief note on reform update by the chairman(CBEC). 2. Also refer to this office letter of even no. 12162-12173 dated 24-02-2016, where a compilation of the measures taken in the field of simplification of tax Administration in Indirect Taxes were forwarded for necessary action and propagating the same through the meetings of various fora including PTFCs, Open Houses and PGC. In continuation of the above, reform update by the Chairman(CBEC) is forwarded herewith for necessary action at your end. 3. You are requested to ensure that the above reform update by the chairman (CBEC) is communicated using various instruments available to the Trade and Industry effectively and a compliance report in this regard may be sent to this office. (Istikhar Baig) Additional Commissioner CCO, Central Excise, Delhi Most Immediate F. No. DP/PUB/08/16/684 To 726 Directorate General of Taxpayer Services C.R. Building, I.P. Estate, New Delhi- 110 109. Dated the 18th April, 2016. OFFICE MEMORANDUM Subject : Update on measures taken to simplify tax administration- reg. DGTS has decided to circulate notes periodically on the measures taken in the area of tax administration such as rationalization of tax structure, simplification of procedures, etc. with the objective of improving ease of doing business, to all the Zonal Chief Commissioners with the request to give widespread publicity to the same. This initiative was taken with the intention of bridging the perception gap, which exists as the trade and industry is often found not aware Of such measures taken by the Department. In this regard, the first such note was forwarded to all the Chief Commissioners of Customs/Central Excise -and Service Tax vide O.M. F. No. DGTS/14/2016 dated 16.02.2016. The Chief Commissioners were requested to bring the same to the notice of members of trade industry through various means including structured meetings held with the trade and industry such as RACS, PTFCs, Open Houses etc., at their level as well as at subordinate officer's levels. 2. It is mentioned that the Chairman (CBEC) has recently forwarded a brief note on reform update enclosed as (Annexure) on 11.03.2016 to the nine major chambers of commerce and industry viz. CII. FICCI, Assocham, PHD Chambers, Society of Indian Mobile Manufactures, etc. 3. A copy of the above reform update is enclosed for necessary action at your end. (Vinay Chhabra) Director General, DGTS The guidelines relating to valuation of second hand machinery revised. In order to achieve nationwide standardization, formats for certification by Chartered Engineers (Indian Overseas) devised. Temporary Imports for exhibitions: Exemption notification issued for enabling temporary importation of goods for display/exhibition/demonstration. The requirement of ITPO certification dispensed. The revised process is simplified, predictable and reduces transaction costs. Under the India-ASEAN FTA, Rules or initiating investigations by DG, Safeguards issued. Export Promotion (Drawback) 100% disbursal of Drawback electronically. Provisional payment of drawback to exporters pending fixation of brand rate. Full transferability of duty credit scrips to pay dues under all three indirect taxes. Exemption to payment of excise duty in the case of locally procured excisable goods against advance authorization, which shall improve cash flow of exporters. Owing to the difficulties faced by the trade in sealing of bulk cargo for exports under Bond, rules amended to grant exemption from self-sealing of bulk cargo for export: Electronic monitoring of export proceeds realization, which shall obviate need for submitting documentary evidence by exporters. As a measure of facilitation verification of export obligation discharge certificates limited to 5% cases. Installation certificates from private chartered engineers allowed. II Central Excise Records can be maintained electronically and digitally signed invoices accepted. Facility of direct dispatch of goods by registered dealer from seller to customer's premises provided. Similar facility allowed in respect of job-workers. More than 50 technical issues on which there was sustained litigation resolved in the Chief Commissioner's Tariff Conference. For details refer CBEC website [Instructions dated 7th December, 2015 containing Annexure B of the Minutes of Tariff Conference held on 28th and 29th October, 2015]. Time limit for taking CENVAT Credit of duty/tax paid on inputs and input services increased from six months to one year. E-payment of refunds and rebates through RTEGS[NEFT introduced. The provision restricting CENVAT credit to 85% under proviso to Rule of 3(i)(vii) of Cenvat Credit Rule, 2004 deleted. Consequently ship-breaking units entailed to avail 100% credit of the CVD paid with effect from 01.03.2015 subject to provisions of Cenvat credit Rule, 2004. Registration for factories operating through multiple premises falling within a range allowed. Requirement of self attestation of the transporter's copy by a manufacturer using digitally signed invoice discontinued Number of returns to be filed by a large manufacturer reduced from 27 to 13. ER-4, ER- 5, ER-6 and ER-7 discontinued. One annual return prescribed for large manufacturers besides monthly return which would continue. Revision of return allowed in Central Excise. Rules for Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods simplified. The requirement of approval of application by central Excise officer discontinued. Procedure for fixation of input-output ratio for payment of rebate simplified. Now, the ratio can be fixed on the basis of a certificate from Chartered engineer without any need for verification by the Central Excise officer. Cenvat - Credit rules amended to improve credit flows and reduce litigation. Key highlights are- Rule relating to apportionment of credit between exempted and non-exempted goods and services simplified. Input services credit flow from Input Services distributor to outsourced manufacturer allowed. Maintenance of common warehouse for distribution of inputs and credit allowed. Small capital goods below a minimum value to be treated as inputs. Credit of inputs such as tools, capital goods such as water pumping station, wagons allowed. Interest rate on late payment of duty reduced to 15% from the present rate of 18% per annum. III Service Tax 100 % e-payment of duty, permission to maintain electronic records, and acceptance of digital Online registration of new service tax assessee in 2 days. Granting provisional payment of 80% of the refund amount with 5 days in respect of service exporters, subject to fulfilment of certain conditions Interest applicable on outstanding taxes has been reduced to 15%. Only in cases where service tax has been collected by the assesse and not deposited shall interest, at a higher rate of 24%, be applicable.