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  1. Budget 2017: NGOs need certainty over registration and approval, says Nabin Ballodia of KPMG

Budget 2017: NGOs need certainty over registration and approval, says Nabin Ballodia of KPMG

The Narendra Modi government should look to extend relief to Non-governmental organisations (NGOs) in the forthcoming Union Budget 2017.

By: | New Delhi | Updated: January 31, 2017 10:07 AM
The Narendra Modi government should look to extend relief to Non-governmental organisations (NGOs) in the forthcoming Union Budget 2017. The Narendra Modi government should look to extend relief to Non-governmental organisations (NGOs) in the forthcoming Union Budget 2017.

The Narendra Modi government should look to extend relief to Non-governmental organisations (NGOs) in the forthcoming Union Budget 2017, says Nabin Ballodia, Partner, Tax, KPMG in India. Terming the role of NGOs as crucial, he says they connect the last person in the society to the government. “Couple of things that social sector have been asking for some time. One is the registration and approval should be done quickly. The other thing that social sector would be looking forward is that of some kind of certainty over registration and approval,” he says. He believes that fixing the timeline for the registration is crucial as it will bring relief to NGOs and in turn they can bring relief to the society.

Regarding the issue of bringing NGOs under LokPal Act, Nabin says “Once these disclosures are made, there will be a lot of transparency and clarity as to what NGOs are doing and what are the people behind the NGOs. The Government can actually use them for the benefit of the society.

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Noting that recent World Bank report has removed India from low income group to lower middle-income group, he says “due to this charity or donations from outside of India have been drying up, instead project-related investment are coming.”

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He also suggests that the government should make sure that whatever profits that come through Program-related investments (PRIs), if it is utilised for a social cause, then there should not be any taxability. “Right now we have lot of restrictions in the form of External Commercial Borrowing Regulations (ECB) that could be restricted,” he says.

Recently, licences of around 20,000 of 33,000 NGOs have been cancelled by the government after they were found to be allegedly violating various provisions of the FCRA, thus barring them from receiving foreign funds. Home Ministry officials had said after cancellation of Foreign Contribution Regulation Act (FCRA) licences of around 20,000 NGOs, only 13,000 NGOs in the country are legally valid now. As per FCRA, if an NGO is put under prior permission category, it is barred to receive foreign funding from abroad without taking permission from the Home Ministry.

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The government also had made it mandatory for all NGOs and voluntary organisations (VOs) to register with NITI Aayog to receive grant-in-aid from ministries or departments of the central government.

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