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MANSA SEEKS SIMPLIFIED TAX COMPLIANCE IN UNION BUDGET AS PART OF EASE OF DOING BUSINESS

BSN Network
Date: 04/11/2016
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Mumbai, November 2016: Mumbai and Nhava Sheva Ship Agents Association has sought abolition of the requirement of filing vessel wise IT returnaltogether and file one single return under section 172 at the end of the year especially for Liner trade.

“Vessel wise returns are the legacy from the days where a single voyage happened for a single shipping agent for a year. Nowadays there are multiple voyages during the year,” MANSA said in a pre-budgetmemorandum routed to the Finance Ministry through Confederation of
Indian Industry.

The memorandum also called for Recognition of NVOCCs as Shipping Line to avail the benefits of Double Taxation Avoidance Agreement (DTAA) whichcurrently is applicable only to Ship owner/charterers/pool arrangements.

The Government has granted permission for vessel sharing in view of the existence of NVOCCs. They should be recognized for availing thebenefits of DTAA. Absence of this benefit would discourage sharing of
the vessel and escalation of freight charges, the memorandum said.

On the issue of service tax, Shipping lines and their respective agents are also at pain to pay it through reverse charge mechanism for having
received services, which is extremely inconvenient and prone to errorsor evasion. Hence it would be appropriate for the tax authorities to lay the onus of collecting service tax on the provider instead of astray service receiver.

“The above three recommendations will not only reduce the compliance cost and time consumed in the process, but will also facilitate in ease of doing business for the trade and Indian economy at large,” saidCaptain Vivek Anand, President of MANSA.

Quoting UNCTAD report released in 2015, Captain Anand pointed out that recent research in Asia and the Pacific suggests that tariffs account for only 0–10 per cent of bilateral
comprehensive trade costs, while other policy-related trade costs (non-tariff nature) account for 60–90 per cent of bilateral trade costs.

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