07, January 2017

1.Jeanette Epps set to become first African-American astronaut to fly to ISS

NASA astronaut Jeanette Epps is set to become the first African-American crew member aboard the International Space Station (ISS) when she flies to the orbital post in May next year, the U.S. space.

NASA assigned veteran Andrew Feustel and Epps to missions aboard the ISS in 2018.

2.India and Kazakhstan sign Protocol to amend the Double Taxation Avoidance Convention (DTAC)

Source: PIB

India and Kazakhstan signed in the national capital a Protocol to amend the existing Double Taxation Avoidance Convention (DTAC) between the two countries which was signed for the avoidance of double taxation and for the prevention of fiscal evasion with respect to taxes on income.

Salient features of the Protocol are as under

  • The Protocol provides internationally accepted standards for effective exchange of information on tax matters. Further, the information received from Kazakhstan for tax purposes can be shared with other law enforcement agencies with authorisation of the competent authority of Kazakhstan and vice versa.
  • The Protocol inserts a Limitation of Benefits Article, to provide a main purpose test to prevent misuse of the DTAC and to allow application of domestic law and measures against tax avoidance or evasion.
  • The Protocol inserts specific provisions to facilitate relieving of economic double taxation in transfer pricing cases. This is a taxpayer friendly measure and is in line with India’s commitment under Base Erosion and Profit Shifting (BEPS) Action Plan to meet the minimum standard of providing Mutual Agreement Procedure (MAP) access in transfer pricing cases.
  • The Protocol inserts service PE provisions with a threshold and also provides that the profits to be attributed to PE will be determined on the basis of apportionment of total profits of the enterprise.
  • The Protocol replaces existing Article on Assistance in Collection of Taxes with a new Article to align it with international standards.

Base erosion and profit shifting

  • Base erosion and profit shifting (BEPS) refers to tax avoidance strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations. Under the inclusive framework, over 100 countries and jurisdictions are collaborating to implement the BEPS measures and tackle BEPS.
  • The inclusive framework brings together over 100 countries and jurisdictions to collaborate on the implementation of the OECD/ G20 Base Erosion and Profit Shifting (BEPS) Package.
  • Monitoring implementation and the impact of the different BEPS measures is a key element of the work ahead. The OECD has established an inclusive framework on BEPS, which allows interested countries and jurisdictions to work with OECD and G20 members on developing standards on BEPS related issues and reviewing and monitoring the implementation of the whole BEPS Package.
  • The inclusive framework will also support the development of the toolkits for low-capacity developing countries. The G20 Development Working Group (G20 DWG) has requested the IMF, the OECD, the UN and the WBG to work together on the development of toolkits and guidance to support low-capacity developing countries to address BEPS issues.

 3.NASA selects 2 missions to explore solar system’s asteroids

Source: Economic Times

NASA selects Psyche and Lucy as new Discovery missions.

Aiming to find important clues to the earliest history of the solar system, NASA has announced two missions — one to explore Jupiter’s mysterious Trojan asteroids and the other to study a unique metal asteroid.

  • The missions, known as Lucy and Psyche, were chosen from five finalists and will proceed to mission formulation, with the goal of launching in 2021 and 2023, respectively, NASA

 Lucy Mission:

  • Lucy will visit a target-rich environment of Jupiter’s mysterious Trojan asteroids.
  • Lucy, a robotic spacecraft, is scheduled for October 2021 launch. It is slated to arrive at its first destination, a main belt asteroid, in 2025. From 2027 to 2033, Lucy will explore six Jupiter Trojan asteroids.
  • These asteroids are trapped by Jupiter’s gravity in two swarms that share the planet’s orbit, one leading and one trailing Jupiter in its 12-year circuit around the sun.
  • The Trojans are thought to be relics of a much earlier era in the history of the solar system, and may have formed far beyond Jupiter’s current orbit.
  • This is a unique opportunity because the Trojans are remnants of the primordial material that formed the outer planets, they hold vital clues to deciphering the history of the solar system. Lucy, like the human fossil for which it is named, will revolutionize the understanding of our origins.

Psyche Mission:

  • The Psyche mission will explore one of the most intriguing targets in the main asteroid belt – a giant metal asteroid, known as 16 Psyche, about three times farther away from the sun than is the Earth.
  • This asteroid measures about 130 miles (210 kilometers) in diameter and, unlike most other asteroids that are rocky or icy bodies, is thought to be comprised mostly of metallic iron and nickel, similar to Earth’s core.
  • The mission will help scientists understand how planets and other bodies separated into their layers – including cores, mantles and crusts – early in their histories.
  • Psyche, also a robotic mission, is targeted to launch in October of 2023, arriving at the asteroid in 2030, following an Earth gravity assist spacecraft maneuvre in 2024 and a Mars flyby in 2025.

4.Saradha, Rose Valley effect: Change in chit fund law to shield investors

Source: Indian Express

 In a chit fund scheme, individuals come together for a predetermined time period and contribute to a common pool at regular intervals.

  • Moving to insulate small savers from ponzi schemes floated by firms such as Saradha and Rose Valley, the Finance Ministry is amending the Chit Funds Act to limit participation to only “fraternity funds”.
  • It is also changing the 1982 law to allow e-auction of chit funds.

Ponzi scheme

A form of fraud in which belief in the success of a non-existent enterprise is fostered by the payment of quick returns to the first investors from money invested by later investors.

Ponzi schemes are ‘get rich quick’ investment scams which pay returns to investors from their own money, or from money paid in by subsequent investors. There is no actual investment scheme as the fraudsters siphon off the money for themselves.

The Prize Chits and Money Circulation Schemes (Banning) Act:

  • In a chit fund scheme, individuals come together for a predetermined time period and contribute to a common pool at regular intervals. Until the end of the scheme, the collected pool of money is loaned out internally through a bidding mechanism to the most deserving member.
  • The new “fraternity fund” nomenclature will distinguish its working from prize chits or marketing schemes that are barred under the Prize Chits and Money Circulation Schemes (Banning) Act.
  • Under the law, chit funds cannot accept deposits and cannot offer other financial products or services. But companies have come under the scanner for luring small savers from rural areas under the garb of chit subscriptions. While Saradha took deposits from people to fund real estate schemes, Rose Valley peddled a holiday membership plan.
  • The CBI started making arrests in the Rose Valley scam, the Finance Ministry moved a Cabinet note to introduce the Chit Funds (Amendment) Bill to “facilitate orderly growth of the sector and remove bottlenecks faced by the industry”.
  • In chit fund schemes, enforcement remains the primary responsibility of the state government. The draft Bill gives them more freedom to regulate such funds.
  • It has proposed that states be allowed to decide the aggregate amount of the chit fund that would come under the Act’s purview. At present, all chits with aggregate amount Rs 100 and below are exempted from provisions and penalties of the Act.
  • “It is proposed to amend section 85 (b) to allow state governments, which administer the schemes, to prescribe this ceiling and to increase it from time to time. Chit funds fall in the Concurrent List and states are free to issue their own law.
  • A new clause is being introduced to protect companies or individuals that act as foreman of the chit fund whereby the promoter would be allowed a right to goods, securities or any other assets of the borrower until the debt is repaid.
  • “Lien for dues would be permitted so that a set-off is allowed to the chit fund for subscribers who have already drawn funds,” sources said.
  • The draft amendment Bill also suggests raising the ceiling of the foreman’s commission to a maximum of seven per cent from current 5 per cent as the rate has remained static since 1982 while overheads and inflation have increased manifold.
  • The Bill, however, does not address a key concern raised by the Key Advisory Group in September 2013 which sought a provision for insurance coverage in case of default by the foreman so that the interest of the investors is protected.
  • At present, there are around 30,000 registered businesses in India, generating a yearly turnover of Rs 35,000 crore. Non-registered chit fund businesses are estimated to be 100 times the size of those registered.



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