Tonnage Tax By State Exemption: Fill & Download for Free

Production in the US kept going up during the war. By the end of the war more than one half of industrial production in the world would take place in the US.“In the wake of Pearl Harbor, the president set staggering goals for the nation’s factories: 60,000 aircraft in 1942 and 125,000 in 1943; 120,000 tanks in the same time period and 55,000 antiaircraft guns. In an attempt to coordinate government war agencies Roosevelt created the War Production Board in 1942 and later in 1943 the Office of War Mobilization. To raise money for defense, the government relied on a number of techniques — calling on the American people to ration certain commodities, generating more tax revenue by lowering the personal exemption and selling government war bonds to individuals and financial institutions. All of these methods served to provide the government with revenue and at the same time keep inflation under control.”“War production profoundly changed American industry. Companies already engaged in defense work expanded. Others, like the automobile industry, were transformed completely. In 1941, more than three million cars were manufactured in the United States. Only 139 more were made during the entire war. Instead, Chrysler made fuselages. General Motors made airplane engines, guns, trucks and tanks. Packard made Rolls-Royce engines for the British air force. And at its vast Willow Run plant in Ypsilanti, Michigan, the Ford Motor Company performed something like a miracle 24-hours a day. The average Ford car had some 15,000 parts. The B-24 Liberator long-range bomber had 1,550,000. One came off the line every 63 minutes. “The University of South Alabama ArchivesThe newly built U.S.S. Fort Laramie is launched in a Mobile channel.“America launched more vessels in 1941 than Japan did in the entire war. Shipyards turned out tonnage so fast that by the autumn of 1943 all Allied shipping sunk since 1939 had been replaced. In 1944 alone, the United States built more planes than the Japanese did from 1939 to 1945. By the end of the war, more than half of all industrial production in the world would take place in the United States.”

Dear Reader,Total tax collection in India (direct & indirect), currently stands at Rs 14.6 lakh crore, of which almost 34 per cent comprises indirect taxes, with Rs 2.8 lakh crore coming from excise and Rs 2.1 lakh crore from Service Tax. With the implementation of the GST (Goods and Services Tax), the entire indirect tax system in India (excise, state-level VAT, service tax) is expected to evolve.Sector wise impact of GST:-Automobiles: -The effective tax rate in the sector currently ranges between 30 per cent and 47 per cent.Highlights:-► On implementation of GST the tax rate is expected to oscillate between 20-22 per cent.► It is expected to drive overall demand and reduce cost for the end user by about 10 per cent.► The transportation time and the overall cost will be reduced as the goods will be transferred from one state to another by easily surpassing various octroi and check points.► In addition to this, the cost for the logistics and supply chain inventory will be curtailed by almost 30-40 per cent.Impact: In a long run, GST is expected to remain positive for automobile sector.Key beneficiaries: Maruti Suzuki, Hero MotoCorp, Bajaj Auto, Eicher Motors, Ashok LeylandConsumer DurableThe current tax rate for the sector ranges between 7 per cent and 30 per cent.Highlights:-► The implementation of GST will essentially benefit companies, which have not availed tax exemptions in the past.► It will lead to the reduction of the price gap between the organised and unorganized sector.► The warehouse/logistics costs across the operational and non-operational segments will be curtailed. This will improve the operational profitability by almost 300-400 bps.The 7th Pay Commission is also expected to boost demand and fund inflow in the consumer durable sector by the end of the year.Impact: The impact may remain neutral or negative, specifically for companies which either enjoy tax exemptions or fall under the concessional tax bracket.Key beneficiaries: CGCE, Havells, Voltas, Blue Star, Bajaj Electricals, Symphony, HitachiFMCGImpact: The impact may remain neutral or negative, specifically for companies which either enjoy tax exemptions or fall under the concessional tax bracket.Key beneficiaries: Nestlé India, Dabur India Ltd.,Cadbury India. Britannia Industries LtdFurnishing and home decorImpact: Currently, the effective tax rate for the sector ranges above 20 per cent.Highlights:-► After the implementation of GST, paints and other construction chemicals companies will benefit from lower tax rate.► At present, the market share for the organised sector is about 65-70 per cent. Effective tax correction practices under the GST regime will ensure that the price difference among the unorganized sector and the organised sector is narrowed. This will improve opportunities for the organized sector.► The overall cost and competitiveness in products such as like ceramic tiles, faucets, sanitary ware and plywood & laminates manufacturer will be curbed.Impact: - Implementation of GST is expected to bring the unorganized sector under a uniform tax base and improve growth opportunities for the organised sector.Key beneficiaries: Asian Paints, Berger Paints, Kansai Nerolac, Akzo Nobel, BASF India, Pidilite, HSIL , Cera Sanitaryware, Greenply, Greenlam Industries, H&R Johnson (Prism Cements), Kajaria Ceramics.LogisticsHighlights: The implementation of GST will lead to lower transit time and thereby generate higher truck utilization.This will boost demand for high tonnage trucks and lead to overall reduction in transportation costs.It will facilitate seamless inter-state flow of goods, which is expected to directly accelerate demand for logistics services.Impact: The logistics sector is largely fragmented and comprises many unorganized players. Several players in the unorganized sector avoid tax which generates a cost gap between them and the organized players.With the GST coming into picture, we expect an overall positive impact, with a reduction in the cost competitiveness as all the players will be brought under a uniform tax base, thereby improving growth opportunities for the organized players.Key beneficiaries: VRL Logistics, GATI, Blue Dart, Transport Corporation of India, Snowman Logistics.CementCurrently the tax on cement ranges between 27 per cent and 32 per cent.Highlights:-► The tax rate for the cement sector is expected to decline to 18-20 per cent under the GST regime.► This is expected to lead to savings in the transportation cost, which currently comprises up to 20-25 per cent of total revenue.► Thereby, overall realizations of cement companies will substantially improve post GST roll-out.Impact: The impact of GST will be positive, as the companies will also be able to save on their logistic costs, due to rationalization of warehouses and lower transportation costs (due to decline transit time).Key beneficiaries: ACC, Ultratech, JK Cement, Shree Cement.EntertainmentWe have divided in two main categories i.e. Multiplexes and Media. We expect a significant impact on both the sectors after implementation of GST.Multiplexes: This category attracts different taxes such as service tax, entertainment tax and VAT among others. Currently, the effective tax ranges between 22-24 per cent.Impact: The overall impact is expected to be positive and the Debit margins of the players are expected to increase by 250-350 bps.Highlights:► It is expected GST tax rate will trickle down to 18-20%.► Reduction in taxes will lead to an increase in average ticket price (ATP) and higher revenue.► There exist several challenges pertaining to.► Availability of limited credit for service tax paid on lease rentals, maintenance cost, advertisements, security charges.► No credit is available on the taxes paid on capital expenditure.► The VAT credit on available on the purchase of F&B can be offset against VAT liability on F&B sales.These will be addressed after the implementation of GST.Key beneficiaries: PVR, Inox LeisureMediaCurrently, the effective tax rate for the DTH providers ranges between 20-21 per cent ( this includes service tax of 14 per cent and entertainment tax of around 5-7 per cent). The effective tax range for the broadcasters is around 14-15 per cent.Highlights:-► On implementation of GST, a blanket rate of around 18-20 per cent will apply, which is lower than current tax rate for the DTH provider and higher for the broadcaster.► Currently the news and print sector is exempted from all indirect taxes. Post GST, we expect concessional rates to be introduced in this sector.Impact:-► Implementation of GST will be healthy for the DTH providers and downbeat for broadcasters.► The overall impact on the news and print sector will be neutral.Key beneficiary: Dish TVMarginally negative : Zee, Sun, HT Media and Jagran PrakashanTextiles/garmentsThe effective tax rate for the sector currently ranges between 6-7 per centHighlights:-► Under the GST regime, there is no clarity whether a lower rate will continue for the ready-made garments.► Companies may be negatively impacted in case the output tax rate is high.► Going forward, several export companies may also avail duty drawback benefits. Though we await more clarity on the impact of these benefits.Key players to be impacted: Arvind, Raymond, Page IndustriesPharmaCurrently, the sector enjoys various location-based tax incentives. The effective tax rate (excise duty) for most companies is much below the statutory tax rate (6 per cent).Highlights:-► The concessional tax bracket for the sector is expected to continue.► The existing tax exemptions will continue until expiry of the tax exemption period. Going forward it will be difficult to bring forth the new exemptions.► GST is also expected to address inverted duty structure and lower logistic costs for the sector.Impact: It is expected remain neutral for the pharmaceutical sector.IT & ITeSCurrently, the IT industry is subject to an effective tax rate of 14 per cent.Highlights:-► The tax rate under GST is expected to increase to 18-20 per cent.► The industry earns a large part of its revenue from exports, which will continue to be exempt under GST.► Litigation around tax ability of canned software will probably end under GST regime as there will be no distinction between goods and services.Impact: It is expected to range from being neutral to slightly negative.TelecomCurrently, telecommunication services are subject to service tax of 14 per cent.Highlights:-► The tax rate is expected to increase to 18 per cent under GST.► It is expected that the telecom companies may pass the increased tax burden on postpaid subscribers.► Availability of input tax credit will lower the sector's capex cost.Impact: Increase in effective tax rate may be marginally negative for the sector. The telecommunication companies may not be able to pass on all the increase in taxes to all the end consumers, especially the ones in the lower Arpu prepaid segment.MetalCurrently, the effective tax rate for base metal products is 19-21 per cent:► VAT ranges from 4-5% depending on the state► Excise 12.5%, CST 2% and entry taxes in respective states.Impact: Under GST, it is not known whether metal products will attract a special rate that is lower than the standard GST rate.Banking and financial servicesCurrently the effective tax rate is 14 per cent, which is levied only on fee component (and not interest) of the transaction.Highlights:-► Under GST, effective tax rate on fee-based transactions is expected to increase to 18-20%.► As the tax on the input services will increase, operating expenses (comprising of rent, legal & professional fee, advertisement, insurance, telecommunication and other expenses) will also increase marginally.Impact: With the implementation of GST a moderate increase in the cost of financial services such as loan processing fees, debit/credit card charges, insurance premiums, etc. is expected.

Dear Reader,Total tax collection in India (direct & indirect), currently stands at Rs 14.6 lakh crore, of which almost 34 per cent comprises indirect taxes, with Rs 2.8 lakh crore coming from excise and Rs 2.1 lakh crore from Service Tax. With the implementation of the GST (Goods and Services Tax), the entire indirect tax system in India (excise, state-level VAT, service tax) is expected to evolve.Sector wise impact of GST:-Automobiles: -The effective tax rate in the sector currently ranges between 30 per cent and 47 per cent.Highlights:-► On implementation of GST the tax rate is expected to oscillate between 20-22 per cent.► It is expected to drive overall demand and reduce cost for the end user by about 10 per cent.► The transportation time and the overall cost will be reduced as the goods will be transferred from one state to another by easily surpassing various octroi and check points.► In addition to this, the cost for the logistics and supply chain inventory will be curtailed by almost 30-40 per cent.Impact: In a long run, GST is expected to remain positive for automobile sector.Key beneficiaries: Maruti Suzuki, Hero MotoCorp, Bajaj Auto, Eicher Motors, Ashok LeylandConsumer DurableThe current tax rate for the sector ranges between 7 per cent and 30 per cent.Highlights:-► The implementation of GST will essentially benefit companies, which have not availed tax exemptions in the past.► It will lead to the reduction of the price gap between the organised and unorganized sector.► The warehouse/logistics costs across the operational and non-operational segments will be curtailed. This will improve the operational profitability by almost 300-400 bps.The 7th Pay Commission is also expected to boost demand and fund inflow in the consumer durable sector by the end of the year.Impact: The impact may remain neutral or negative, specifically for companies which either enjoy tax exemptions or fall under the concessional tax bracket.Key beneficiaries: CGCE, Havells, Voltas, Blue Star, Bajaj Electricals, Symphony, HitachiFMCGImpact: The impact may remain neutral or negative, specifically for companies which either enjoy tax exemptions or fall under the concessional tax bracket.Key beneficiaries: Nestlé India, Dabur India Ltd.,Cadbury India. Britannia Industries LtdFurnishing and home decorImpact: Currently, the effective tax rate for the sector ranges above 20 per cent.Highlights:-► After the implementation of GST, paints and other construction chemicals companies will benefit from lower tax rate.► At present, the market share for the organised sector is about 65-70 per cent. Effective tax correction practices under the GST regime will ensure that the price difference among the unorganized sector and the organised sector is narrowed. This will improve opportunities for the organized sector.► The overall cost and competitiveness in products such as like ceramic tiles, faucets, sanitary ware and plywood & laminates manufacturer will be curbed.Impact: - Implementation of GST is expected to bring the unorganized sector under a uniform tax base and improve growth opportunities for the organised sector.Key beneficiaries: Asian Paints, Berger Paints, Kansai Nerolac, Akzo Nobel, BASF India, Pidilite, HSIL , Cera Sanitaryware, Greenply, Greenlam Industries, H&R Johnson (Prism Cements), Kajaria Ceramics.LogisticsHighlights: The implementation of GST will lead to lower transit time and thereby generate higher truck utilization.This will boost demand for high tonnage trucks and lead to overall reduction in transportation costs.It will facilitate seamless inter-state flow of goods, which is expected to directly accelerate demand for logistics services.Impact: The logistics sector is largely fragmented and comprises many unorganized players. Several players in the unorganized sector avoid tax which generates a cost gap between them and the organized players.With the GST coming into picture, we expect an overall positive impact, with a reduction in the cost competitiveness as all the players will be brought under a uniform tax base, thereby improving growth opportunities for the organized players.Key beneficiaries: VRL Logistics, GATI, Blue Dart, Transport Corporation of India, Snowman Logistics.CementCurrently the tax on cement ranges between 27 per cent and 32 per cent.Highlights:-► The tax rate for the cement sector is expected to decline to 18-20 per cent under the GST regime.► This is expected to lead to savings in the transportation cost, which currently comprises up to 20-25 per cent of total revenue.► Thereby, overall realizations of cement companies will substantially improve post GST roll-out.Impact: The impact of GST will be positive, as the companies will also be able to save on their logistic costs, due to rationalization of warehouses and lower transportation costs (due to decline transit time).Key beneficiaries: ACC, Ultratech, JK Cement, Shree Cement.EntertainmentWe have divided in two main categories i.e. Multiplexes and Media. We expect a significant impact on both the sectors after implementation of GST.Multiplexes: This category attracts different taxes such as service tax, entertainment tax and VAT among others. Currently, the effective tax ranges between 22-24 per cent.Impact: The overall impact is expected to be positive and the Debit margins of the players are expected to increase by 250-350 bps.Highlights:► It is expected GST tax rate will trickle down to 18-20%.► Reduction in taxes will lead to an increase in average ticket price (ATP) and higher revenue.► There exist several challenges pertaining to:► Availability of limited credit for service tax paid on lease rentals, maintenance cost, advertisements, security charges.► No credit is available on the taxes paid on capital expenditure.► The VAT credit on available on the purchase of F&B can be offset against VAT liability on F&B sales.These will be addressed after the implementation of GST.Key beneficiaries: PVR, Inox LeisureMediaCurrently, the effective tax rate for the DTH providers ranges between 20-21 per cent ( this includes service tax of 14 per cent and entertainment tax of around 5-7 per cent). The effective tax range for the broadcasters is around 14-15 per cent.Highlights:-► On implementation of GST, a blanket rate of around 18-20 per cent will apply, which is lower than current tax rate for the DTH provider and higher for the broadcaster.► Currently the news and print sector is exempted from all indirect taxes. Post GST, we expect concessional rates to be introduced in this sector.Impact:-► Implementation of GST will be healthy for the DTH providers and downbeat for broadcasters.► The overall impact on the news and print sector will be neutral.Key beneficiary: Dish TVMarginally negative : Zee, Sun, HT Media and Jagran PrakashanTextiles/garmentsThe effective tax rate for the sector currently ranges between 6-7 per centHighlights:-► Under the GST regime, there is no clarity whether a lower rate will continue for the readymade garments.► Companies may be negatively impacted in case the output tax rate is high.► Going forward, several export companies may also avail duty drawback benefits. Though we await more clarity on the impact of these benefits.Key players to be impacted: Arvind, Raymond, Page IndustriesPharmaCurrently, the sector enjoys various location-based tax incentives. The effective tax rate (excise duty) for most companies is much below the statutory tax rate (6 per cent).Highlights:-► The concessional tax bracket for the sector is expected to continue.► The existing tax exemptions will continue until expiry of the tax exemption period. Going forward it will be difficult to bring forth the new exemptions.► GST is also expected to address inverted duty structure and lower logistic costs for the sector.Impact: It is expected remain neutral for the pharmaceutical sector.IT & ITeSCurrently, the IT industry is subject to an effective tax rate of 14 per cent.Highlights:-► The tax rate under GST is expected to increase to 18-20 per cent.► The industry earns a large part of its revenue from exports, which will continue to be exempt under GST.► Litigation around tax ability of canned software will probably end under GST regime as there will be no distinction between goods and services.Impact: It is expected to range from being neutral to slightly negative.TelecomCurrently, telecommunication services are subject to service tax of 14 per cent.Highlights:-► The tax rate is expected to increase to 18 per cent under GST.► It is expected that the telecom companies may pass the increased tax burden on postpaid subscribers.► Availability of input tax credit will lower the sector's capex cost.Impact: Increase in effective tax rate may be marginally negative for the sector. The telecommunication companies may not be able to pass on all the increase in taxes to all the end consumers, especially the ones in the lower Arpu prepaid segment.MetalCurrently, the effective tax rate for base metal products is 19-21 per cent:► VAT ranges from 4-5% depending on the state► Excise 12.5%, CST 2% and entry taxes in respective states.Impact: Under GST, it is not known whether metal products will attract a special rate that is lower than the standard GST rate.Banking and financial servicesCurrently the effective tax rate is 14 per cent, which is levied only on fee component (and not interest) of the transaction.Highlights:-► Under GST, effective tax rate on fee-based transactions is expected to increase to 18-20%.► As the tax on the input services will increase, operating expenses (comprising of rent, legal & professional fee, advertisement, insurance, telecommunication and other expenses) will also increase marginally.Impact: With the implementation of GST a moderate increase in the cost of financial services such as loan processing fees, debit/credit card charges, insurance premiums, etc. is expected.