Current Affair 1:

Advance Pricing Agreement (APA) Programme of India

 

The Advance Pricing Agreement (APA) programme of Central Board of Direct Taxes (CBDT) is one of its foremost initiatives for promoting an investor-friendly and non-adversarial tax regime in India. Since its inception, the Indian APA programme has contributed significantly to the Government of India’s mission of promoting ease of doing business.

Understand Advance Pricing Agreement in simple terms:

One of the disputed issues in taxation related to MNCs is the area of intra company transactions. The pricing of goods and services between two related companies is called transfer pricing.

Here, a parent company say in Japan may charge a convenient price from its subsidiary in India to minimise its tax payment in India. For example, suppose that Maruti Suzuki India has higher profit and has to pay higher tax to the Government of India. In this case, if Suzuki Japan charges a high price for a component it sold to Maruti, profit of Maruti will come down and the tax payment of the company to GoI will also come down. On the other hand, the revenue of Suzuki Japan will go up. Altogether, the Suzuki Motor Corporation (SMC) who owns India’s Maruti improves is position; but GoI’s tax revenue affected.

To avoid such a manipulation, tax department of India presets the price charged for different components between Maruti and SMC. At the beginning of a year, the price charged for intra company transactions will be determined in advance and will be kept for the coming five years or so. This price arrangement between Maruti and India’s tax department is called advance price agreement.

What is APA?

An APA is a contract, usually for multiple years, between a taxpayer and at least one tax authority specifying the pricing method that the taxpayer will apply to its related-company transactions. These programmes are designed to help taxpayers voluntarily resolve actual or potential transfer pricing disputes in a proactive, cooperative manner, as an alternative to the traditional examination process.

An APA can be unilateral, bilateral, or multilateral.

Unilateral APA (UAPA): an APA that involves only the tax payer and the tax authority of the country where the tax payer is located.

Bilateral APA (BAPA): an APA that involves the tax payer, associated enterprise (AE) of the tax payer in the foreign country, tax authority of the country where the tax payer is located, and the foreign tax authority.

Multilateral APA (MAPA): an APA that involves the tax payer, two or more AEs of the tax payer in different foreign countries, tax authority of the country where the tax payer is located, and the tax authorities of AEs.

Now as per the recent report:

The Central Board of Direct Taxes (CBDT) has recently released the fourth and fifth annual APA reports.

In FY 2022-23, CBDT recorded the highest ever APA signings in any financial year since the launch of the APA programme, signing a total of 95 APAs.

Advantages:

1. The impact of the APA programme in increasing the ease of doing business is evident from the number of years for which it has brought certainty in transfer pricing matters and reduced litigation.
2. The APA programme is also an important tool to decongest the tax tribunals and higher

judiciary of transfer pricing litigation.

CBDT also signed 32 Bilateral Advance Pricing Agreements (BAPAs) in FY 2022-23 being the maximum number of BAPAs in any financial year till date. This figure is more than double the previous signing record of 13 BAPAs in any financial year.

 

Current Affair 2:

ULLAS Scheme

 

Government of India has approved a new Centrally Sponsored Scheme “ULLAS for the period FYs 2022-2027 to cover all the aspects of Education For All (erstwhile termed as Adult Education) to align with National Education Policy 2020 and Budget Announcements FY 2021-22.

The objectives of the scheme is to impart not only Foundational Literacy and Numeracy but also to cover other components which are necessary for a citizen of 21st century such as

1. Critical Life Skills (including financial literacy, digital literacy, commercial skills, health care and awareness, child care and education, and family welfare)
2. Vocational Skills Development (with a view towards obtaining local employment)
3. Basic Education (including preparatory, middle, and secondary stage equivalency) and
4. Continuing Education (including engaging holistic adult education courses in arts, sciences, technology, culture, sports, and recreation, as well as other topics of interest or use to local learners, such as more advanced material on critical life skills).

Features:

1. The scheme will be implemented through volunteerism through online mode.
2. The scheme will cover non-literates of the age group of 15 years and above in all state/UTs in the country.
3. The target for Foundational Literacy and Numeracy for FYs 2022-27 is 5 (five) crore learners @ 1.00 crore learners per year by using “Online Teaching, Learning and Assessment System (OTLAS)” in collaboration with NIC, NCERT and NIOS.
4. School will be Unit for implementation of the scheme.

Current Affair 3:

Personalised Adaptive Learning (PAL)

 

The National eGovernance Division (NeGD) under the Ministry of Electronics and Information Technology (MeitY) is set to integrate Personalised Adaptive Learning (PAL) into its existing Digital Infrastructure for Knowledge Sharing (DIKSHA) platform.

Personalised Adaptive Learning (PAL) is an educational approach that uses technology, particularly artificial intelligence (AI), to customize the learning experience for individual students based on their unique needs, abilities, and progress.

In an example of how PAL works, if a student of Class 9 is learning the Pythagoras theorem and makes a calculation mistake, the AI learning system flags it and loops the student back to a basic video of how to make the calculation.

About DIKHSHA:

DIKSHA (Digital Infrastructure for Knowledge Sharing) is a national platform for school education, an initiative of National Council for Educational Research and Training (NCERT), under the aegis of the Ministry of Education. Launched in 2017, DIKSHA has been adopted by almost all the States, Union Territories, central autonomous bodies/boards including CBSE.

During the pandemic, the massive teacher’s professional development programme NISHTHA 1.0 (National Initiatives for School Heads and Teacher’s Holistic Advancement) for Elementary grades was launched online through DIKSHA. NISHTHA 2.0 & 3.0 focus on Secondary and Foundational Literacy and Numeracy. Apart from NISHTHA, several States/UTs have designed their own capacity building programs.

 

Current Affair 4:

Pradhan Mantri Formalization of Micro food processing Enterprises (PMFME) Scheme

 

Introduction of any scheme is very important:

This scheme is designed to address the challenges faced by the micro enterprises and to tap the potential of groups and cooperatives in supporting the upgradation and formalization of these enterprises.

About the scheme:

Ministry of Food Processing Industry (MoFPI) has launched the Pradhan Mantri Formalization of Micro food processing Enterprises (PMFME) scheme under the Aatmanirbhar Bharat Abhiyan with the aim to enhance the competitiveness of existing individual micro-enterprises in the unorganized segment of the food processing industry and promote formalization of the sector.

The scheme to be implemented over a period of five years from 2020-21 to 2024-25 with a total outlay of Rupees 10,000 crore. The expenditure under the scheme would to be shared in 60:40 ratio between Central and State Governments, in 90:10 ratio with North Eastern and Himalayan States, 60:40 ratio with UTs with legislature and 100% by the Center for other UTs.

Objectives

The objectives of scheme are to build capability of microenterprises to enable:

• Increased access to credit by existing micro food processing entrepreneurs, FPOs, Self Help Groups and Co-operatives;
• Integration with organized supply chain by strengthening branding & marketing;
• Support for transition of existing 2,00,000 enterprises into formal framework;
• Increased access to common services like common processing facility, laboratories, storage, packaging, marketing and incubation services;
• Strengthening of institutions, research and training in the food processing sector; and
• Increased access for the enterprises, to professional and technical support.

Coverage

Under the scheme, 2,00,000 micro food processing units will be directly assisted with credit linked subsidy. Adequate supportive common infrastructure and institutional architecture will be supported to accelerate growth of the sector.

The Scheme adopts One District One Product (ODOP) approach to reap the benefit of scale in terms of procurement of inputs, availing common services and marketing of products. ODOP for the scheme will provide the framework for value chain development and alignment of support infrastructure.

 

<< Previous Next >>