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A Tax Haven Blacklist

 

European Union has blacklisted certain nations that are considered tax havens and do not comply with its taxation standards. Army has ‘wiped out’ terrorists who had masterminded Amarnath Yatra attack this year. Airlines are expecting a slightly higher profit per passenger next year. Government has provided sops to the small and medium industries to help improve exports. 

 

17

What is it? The number of countries that feature on a European Union (EU) blacklist of nations that are non-compliant with EU standards for tax purposes, including Saint Lucia, South Korea and Barbados.

Why is it important? This EU name-and-shame action comes about a month after the publishing of The Paradise Papers, which made public how the world’s rich and famous used tax havens and contentious tax structures to avoid taxes. However, the onus to act against these 17 countries—a list that, tellingly enough, doesn’t include a single EU member—lies on individual member countries, and it remains to be seen if they will follow through.

Tell me more: The EU also placed another 47 jurisdictions on a newly established ‘grey list’—countries that are also deemed to be non-compliant, but have committed to changing their tax rules. This list includes Switzerland and Hong Kong.

 

5

What is it? The number of months since a militant group attacked a group of pilgrims on the Amarnath Yatra.

Why is it important? On Tuesday, Jammu and Kashmir’s Director General of Police (DGP) tweeted that the gang that carried out the July attack has been “wiped out”. In the attack near Anantnag on the Srinagar-Jammu National Highway in South Kashmir, seven pilgrims were killed and 15 injured. This year has seen a series of successful encounters by security forces, where top militants such as Lashkar-e-Taiba (LeT) commander Abu Dujana, Hizbul Mujahideen’s Sabzar Ahmad Bhat and Jaish-e-Mohammed chief Masood Azhar’s nephew Tallah Rashid have been killed.

Tell me more: LeT chief Abu Ismail, who was the mastermind behind the Amarnath attack, was killed by the security forces in the outskirts of Srinagar in September.

 

$8.9

What is it? The expected average net profit per departing passenger in the global airline sector in 2018, according to the International Air Transport Association (IATA).

Why is it important? If the prediction is met, it would be a slight increase from $8.45 in 2017. This is even as overall net profit is expected to increase to $38.4 billion in 2018, from the projected $34.5 billion in 2017. IATA says the key drivers of profitability would be a likely 6% increase in passenger traffic, an expected 4.5% rise in cargo volumes and lower debt levels. However, costs, too, are expected to increase: oil prices are expected to average $60 per barrel, and labour costs, which are a larger expense item than fuel, will continue to rise.

Tell me more: IATA expects seat occupancy to reach 81.4% next year whereas yields, which is a measure of fares, would improve by 3%. For the 10 months of 2017 till October, the seat occupancy of IndiGo ranged from 81.6-91.1%.

 

Rs 8,450 crore

What is it? The cumulative additional incentives announced by the Indian government for labour-intensive MSME (micro, small and medium enterprises) sectors under two schemes, as part of its mid-term policy review released on Tuesday.

Why is it important? This is to boost exports, which fell 1.1% to $23 billion in October, the slowest pace of growth since July 2016 and the first decline after 14 months of positive growth, likely due to the roll-out of the goods and services tax. The President of the Federation of Indian Export Organisations believes these incentives are likely to have a positive impact on export numbers from January, though he expressed disappointment about a number of sectors having been left out.

Tell me more: Some major sectors that would benefit from the incentives include ready-made garments and made-ups in the textile sector, leather and footwear articles, and agriculture and related products. The earlier incentives under the two schemes totaled Rs 25,000 crore.

 

704 days

What is it?  The number of days after which South African star batsman AB de Villiers will return to play test cricket, if he is selected for the Boxing Day test against Zimbabwe.

Why is it important? AB de Villiers has been one of the pivots of South African batting, but a combination of wanting to play less cricket and injuries have meant him not playing tests. His possible return comes at a crucial time for South Africa, as its next two test assignments are stern examinations: against India, the only side ranked above it in the ICC test rankings, and Australia.

Tell me more: Among current South African batsmen, who are a relatively inexperienced lot, only Hashim Amla leads de Villiers in runs scored and tests played.

 

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News in numbers, Apr 4, 2016: Amazon India’s authorised capital, spectrum usage charges…

> 500

What is it? The number of Indians who have allegedly set up offshore entities in tax havens such as British Virgin Islands, Bahamas, Seychelles and Panama.

Why is it important? Indicates a means of tax avoidance and possibly, money laundering. According to the analysis, most of the offshore entities were set up before the rules allowed individuals to set up subsidiaries or invest in joint ventures abroad.

Tell me more: The list of Indians includes movie stars (Amitabh Bachchan, Aishwarya Rai Bachchan), politicians (such as Anurag Kejriwal, the former chief of the Delhi unit of Loksatta Party) and businessmen (DLF owner KP Singh, elder brother of Gautam Adani, founder chairman of the Adani Group). This is according to an analysis of the 11 million leaked documents of a Panama law firm by the Indian Express.

Rs 16,000 crore

What is it? Amazon India’s authorised capital, the maximum capital a company can raise by selling its shares.

Why is it important? At double the earlier amount, it exceeds its $2 billion (over Rs 13,000 crore) commitment made by Jeff Bezos in 2014. This puts tremendous pressure on its rivals Flipkart and Snapdeal, which has to depend on VC funding to grow its business.

Tell me more: Amazon India’s market share in terms of gross merchandise value was 12% in 2015 while that of its rivals Snapdeal and Flipkart was 26% and 45% respectively, according to Morgan Stanley.

6.9%

What is it? India’s expected combined fiscal deficit, i.e, excess of expenditure over receipts of the centre and states, as a percentage of GDP in 2016-17, according to HSBC.

Why is it important? The ratio is same as in 2015-16. Bringing down fiscal deficit is key to improving credit ratings and to bring down interest rates, which are essential to boost India’s tepid economic growth.

Tell me more: The aggregate fiscal deficit of 17 states is likely to be higher at 2.9% of GDP in 2016-17 compared with 2.7% in 2015-16 due to the twin components of Seventh Pay Commission payouts and their interest bills on UDAY (financial turnaround and revival of power distribution companies) bonds.

276,000

What is it? The number of orders Tesla Motors Inc has received for its new Model 3 electric sedan since March 31.

Why is it important? If all these orders were converted into actual purchases, Tesla would earn $10 billion in revenues, which is 2.5 times its revenues last year. But some analysts say the company may find it difficult to ramp up its production to match the orders for its first mass-market car, potentially delaying delivery to customers.

Tell me more: Tesla, which posted net loss of $889 million in 2015, expects to turn profitable by the end of 2016.

3%

What is it? The spectrum usage charges of telecom companies as a percentage of adjusted gross revenues, down from 5% earlier.

Why is it important? This is likely to result in savings of Rs 3,200 crore for telecom companies, which are reeling under massive debts of Rs 3.5 lakh crore on revenues of around Rs 2.2 lakh crore. It remains to be seen if this cut brings down mobile and broadband charges.

Tell me more: The next spectrum auctions are scheduled for July when the government would sell over 2,000 MHz of spectrum across seven frequencies.

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