Service tax rate could be hiked to 14 pc
New Delhi: Service tax rate may be increased from 12 per cent to possibly 14 per cent in the forthcoming Budget and 44 new items — like lending services, sports and amusement parks — are set to be brought under the service tax net.

At present, the service tax rate stands at 12 per cent. Added to this is a 2 per cent education cess, bringing the incidence to 12.24 per cent.

The move is a part of the compensation package agreed upon by the union and state governments for phasing out the Central Sales Tax (CST) levied on inter-state trade. This is being seen as a precursor to a hike in the service tax rate.

CST is collected by the Centre and its proceeds transferred to state governments. The Union government collects and transfers 30.5 per cent of service tax proceeds to states.

Other services among the 44 new items that will attract service tax include health, hotel and lodging, electricity distribution, education, and artistic performances, including those by Bollywood stars.
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India, Italy to expand trade
New Delhi: India and Italy are planning to move forward to begin negotiations for a trade and investment agreement between India and the European Union as decided at the Helsinki Summit in October 2006.

The visiting Italian Minister for International Trade and European Affairs, Emma Bonino, had extensive bilateral talks with the Union Commerce and Industry Minister, Kamal Nath and both sides see immense scope for a much higher level of trade and economic engagement between the two countries.
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Inflation rises
New Delhi: The annual wholesale price index-based inflation rose 5.48 per cent during the week ended December 23, higher than the previous week's annual rise of 5.43 per cent. The increase in the inflation rate was mainly on account of a surge in some food and manufactured product prices, Government data showed on Friday.

The wholesale price index (base 1993-94), on which the inflation data is based, rose 0.1 per cent to 208 points during the week ended December 23 from 207.8 points during the previous week. Inflation was at 4.62 per cent during the corresponding period of the previous year. On a disaggregated basis, the Primary Articles' group was up 0.3 per cent at 212.4 points. The heavyweight Manufactured Products' group was up 0.2 per cent to 181.2 points while the Fuel, Power, Light and Lubricants' group was down 0.3 per cent at 321.6 points during the latest reported week.

Among the Primary Articles' group, the Food Articles' index saw an increase following a surge in prices of several commodities, with bajra, maize and fish marine became dearer by two per cent each, while prices of wheat and ragi moved up by one per each.

However, prices of jowar, moong, barley, urad and gram declined by one per cent each.

Prices of sunflower rose by 11 per cent, raw rubber and safflower by eight per cent each and linseed and raw tobacco by three per cent each.

Among the Manufactured products' group, prices of food items including non-blended black tea leaf rose by 18 per cent and rice bran oil, oil cakes and imported edible oil by two per cent each. However, the prices of processed tea fell by six per cent and sugar by one per cent.

In other categories of manufactured items, prices of enamelled copper wires rose by 31 per cent, barrels by seven per cent, zinc by four per cent and aluminium foils by three per cent. Prices of plastic containers fell by six per cent, lead ingots by three per cent and zinc ingots by two per cent. Among the Fuel, Power, Light and Lubricants' group, prices of electricity declined by one per cent.

The Government also revised inflation to 5.35 per cent for the week ended October 28 from the provisional estimate of 5.09 per cent.

This follows revision in wholesale price index to 208.9 points, against 208.4 points estimated in the provisional data.
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Terror attempt on Infosys, airport thwarted
Bangalore: Police arrested a suspected militant from Jammu and Kashmir on the city outskirts on Friday, foiling plans to attack the airport and Bangalore's information technology showpiece Infosys Technologies.

Acting on a tip off, a Bangalore police team intercepted a private bus coming from Hospet in Bellary district at Jalahalli in the early hours on Friday and nabbed the suspected terrorist, who disclosed his name as Imran alias Bilal, aged about 32. The police said on searching his bags, one AK-47 assault rifle, 300 rounds of ammunition, four AK-47 magazines, SIM cards, a satellite phone and a few documents, were found.

A map of Bangalore city with marking of some locations, including the airport and Infosys, was also found in his possession by the police team, which included senior police officers Bipin Gopalakrishna, Gopal Hosur and Ravikante Gowda.
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