Daily Prelims Notes 8 June 2020
- June 8, 2020
- Posted by: admin1
- Category: DPN
Table Of Contents
- Direct Tax Buoyancy, Revenue Foregone, Tax Base
- Mission Sagar
- Persian Gulf and GCC
- Environment Performance Index
- Assam Gas Leak
- The gross direct tax collection in 2019-20 fiscal dipped 4.92 per cent to Rs 12.33 lakh crore on account of reduction in corporate tax rate, increased standard deduction and personal I-T exemption limit, the Income Tax department.
- The gross collections would have clocked 8 per cent growth to Rs 14.01 lakh crore in 2019-20 if revenue foregone in corporate tax and Personal Income Tax is taken into account.
- By removing the effect of the extraordinary and historic tax reform measures and higher issuance of refunds during the FY 2019-20, the buoyancy of total gross direct tax collection comes to 1.12
- Tax buoyancy explains this relationship between the changes in government’s tax revenue growth and the changes in GDP.
- It refers to the responsiveness of tax revenue growth to changes in GDP.
- When a tax is buoyant, its revenue increases without increasing the tax rate.
- A similar looking concept is tax elasticity. It refers to changes in tax revenue in response to changes in tax rate.
- The revenue forgone is also referred to as tax expenditure or indirect subsidy to taxpayers.
- The tax policy provides specific tax incentives which give rise to tax preferences. Such preferences have a definite revenue impact
- The Indian government started publishing the Statement of Revenue Foregone in 2006. This estimate of revenue foregone is intended to indicate the potential revenue gain if all tax incentives (exemptions, deductions, and similar measures) were rationalized.
The tax base is the total amount of assets or revenue that a government can charge tax on. For example, the assessed value is the tax base for property taxes and taxable income is the tax base for income tax. It can also be defined as the total of taxable income, taxable assets, and the assessed value of property within the government tax jurisdiction.
Tax Base in India
The tax base is different for direct tax and indirect tax. Direct taxes include income tax and property tax, whereas indirect taxes include GST, excise duty, and customs duty.
The Income Tax Act under direct tax laws lays down the regulations of income tax. For example, an individual and HUF assessees with income more than Rs.2.5 lakh has to pay tax under the income tax. But there is no such income limit for other assessees like companies, partnership firms. The total of taxable income from all taxpayers constitutes the tax base.
The Goods & Services Tax Act decides the GST base under indirect tax laws. For example, a registered person whose turnover is above Rs.40 lakh has to pay GST. The turnover of all taxpayers will constitute the tax base.
To arrive at the tax liability, we should multiply the tax base with the respective tax rate.
The size and growth (increase or decrease) of the tax base is crucial to the planning of local, state, or central government. The tax base size influences the taxable revenues which are available to a government. There is a direct correlation between the economic condition of the country and the budget of the government. The government has to always consider how their decisions will affect their tax base.
As part of Mission Sagar, INS Kesari has carried a consignment of COVID related essential medicines for the people of Seychelles.
- India launched Mission Sagar as part of the government’s outreach initiative towards five Island nations in the Indian Ocean amidst the ongoing COVID-19 pandemic.
- Indian Naval Ship Kesari has been used to assist Maldives, Mauritius, Seychelles, Madagascar and Comoros, to provide Food Items, COVID related Medicines including HCQ Tablets and Special Ayurvedic Medicines with Medical Assistance Teams.
- This deployment as ‘Mission Sagar’ is in line with India’s role as the first responder in the region and builds on the excellent relations existing between these countries to battle the COVID-19 pandemic and its resultant difficulties
- The deployment is in consonance with the Prime Ministers’ vision of Security and Growth for All in the Region ‘SAGAR’ promulgated in March 2015.
- SAGAR highlights the importance accorded by India to relations with her neighboring countries and further strengthens the existing bond.
As the pandemic stifles economic activity, experts kept warning of a much harsher recession in the Gulf.
- Persian Gulf, the body of water is surrounded by eight countries Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates
- The Gulf Cooperation Council (GCC) is a political and economic alliance of six countries in the Arabian Peninsula: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
- Established in 1981, the GCC promotes economic, security, cultural and social cooperation between the six states and holds a summit every year to discuss cooperation and regional affairs.
India has improved its place in Environment Performance Index but still poorly ranked
- India secured 168 rank in the 12th edition of the biennial Environment Performance Index (EPI Index 2020) that measured the environmental performance of 180 countries
- It was released by the Yale University on June 4, 2020.
- India’s rank was 177 (with a score of 27.6 out of 100) in 2018.
- All South Asian countries, except Afghanistan, were ahead of India in the ranking.
Since the morning of May 27, natural gas has been continuously flowing out of a gas well in Assam
- The Baghjan 5 well is a purely gas-producing well in Tinsukia district. Sometimes, the pressure balance in a well may be disturbed leading to ‘kicks’ or changes in pressure. If these are not controlled in time, the ‘kicks’ can turn into a sudden blowout.
- Maguri-Motapung wetland, an Important Bird Area notified by the Bombay Natural History Society situated near to the site. The park is famous for its birds, butterflies, wild cats, and feral horses.
- Dibru-Saikhowa National Park is located at an aerial distance of 900 meters from the leak site.
Dibru-Saikhowa National Park
- Dibru-Saikhowa is a National Park as well as a Biosphere Reserve situated in the south bank of the river Brahmaputra in the extreme east of Assam state in India.
- Situated in the flood plain of Brahmaputra, Dibru-saikhowa is a safe haven for many extremely rare and endangered species of Wildlife.
- The forest type of Dibru-Saikhowa comprises of semi-evergreen forests, deciduous forests, littoral and swamp forests and patches of wet evergreen forests.