Tax

With a rehash of the income statement and significant new disclosure requirements including MPMs (Management defined performance measures), IFRS 18 will be a strategic shift in how performance is communicated to the key stakeholders. Early planning could help in unlocking better insights.

The regulatory landscape, especially FEMA and FDI regulations, is constantly evolving in the direction of ease of doing business. In this regard, it is imperative that compliance teams within businesses proactively engage with all stakeholders including the concerned authorities in order to ensure compliance at a minimum but also add strategic advantage to business operations.

The GST rate rationalisation is a very good move, especially in the current context of US tariffs which have caused stressed in certain sectors and the overall economy. The rate reduction from 12% to 5% and from 28% to 18% is likely to drive comsumption. In addition, consumers are likely to benefit from reduced prices of most goods due to competitive pricing.

The proposed GST rate rationalisation measure is a welcome step toward simplifying the Indirect Tax framework. By reducing the slabs and lowering rates on essential goods, the reforms are likely to have a significant impact on certain industries where rates are touted to be rationalised. The industry would need to prepare itself with impact assessments, pricing re-recalibration and impact on transition stock to ensure a smooth shift to the new regime. The messaging around the removal of the compensation cess is also encouraging, as it will simplify the tax structure, allowing flexibility to the Government to make it more rational and balanced.

This approach reflects a shift towards clarity and consistency in taxation. It can help reduce complexities that have arisen since GST implementation, minimising classification disputes, ensuring that exceptions are applied judiciously where they are truly needed. The reforms would surely bring in predictability for businesses and consumers alike, a step towards a more stable, transparent, and future-ready tax ecosystem.

The clarification by CBIC on GST rules for post-sale discounts will help industry and trade execute such transactions with greater certainty and reduce disputes around what has long been a contentious issue. At the same time, for scenarios involving agreements with end customers for passing on specific benefits to end-consumers through dealers in the supply chain, businesses may need to carefully revisit and evaluate their positions.

As per the latest EPFO circular dated 22 July 2025, from August 2025 onwards, employers must accurately report gross wages in the Electronic Challan-cum-Return (ECR). This is with the intention to enable proper identification of employees eligible under the ELI Scheme. Incentives under the ELI scheme are envisaged for the employer and employees only where the eligible employees' gross wages reported in ECR does not exceed INR 1,00,000 per month. Hence, the importance of appropriate determination of and reporting of gross wages has been reiterated by EPFO.

Indian Government has launched a revamped Overseas Citizens of India (OCI) portal. The updated portal aims to provide enhanced functionality, improved security, and a user-friendly experience for the existing over 5 million OCI cardholders and new users.

Multiple features are said to have been introduced in the new OCI portal:

• User sign-up and segregation of registration menu
• Autofill of user profile details in registration forms
• Dashboard displaying completed and partially filled applications
• Integrated online payment gateway for those who filed in FRROs
• Seamless navigation across application steps
• Categorisation of requisite documents to upload based on application type,
• Editing option to the applicant at any stage before submission,
• Integrated FAQ in the portal,
• Reminder to the applicant to verify information before final submission,
• Display of eligibility criteria and requisite documents based on selected application type,
• In-built image cropping tool for uploading applicant photos and signatures.

A step towards providing an up=to-date user interface to ensure seamless registration process for OCI cardholders.