Industry demands non-adversarial tax environment, lower rates
January, 07th 2015
India Inc today pressed for non- adversarial tax environment and lower rates to boost economy even as Finance Minister Arun Jaitely promised to take steps to improve ease of doing business for promoting manufacturing.
In the customary pre-Budget consultation with the Finance Minister, industry demanded increase in public spending in the infrastructure sector and expediting the reform process to promote 'Make in India' campaign.
Admitting that the manufacturing growth is still patchy, Jaitley in his opening remarks said: "We still have lot of distance to cover. Ease of doing business is high priority for the government. We are working on a task given by the Prime Minister to improve India's ranking".
He also said that implementation of GST is expected to improve the tax administration regime and would help in bringing more transparency in the system and ensure smooth flow of goods.
Talking to reporters after the meeting, CII President Ajay Shriram said: "We had a good discussion. We raised several issues. The rate of MAT should be restricted to 10 per cent to provide a fillip to manufacturing. The developers and units in SEZs should be provided relief from MAT and DDT".
Ficci President Jyotsna Suri said that efforts should be made to move away from the aggressive revenue approach and provide "a genuine non-adversarial and conducive tax environment" for industry and economy to flourish.
"I requested for rationalisation of tax regime. There is a revenue target given to tax officers and because they have to attain that, they often use irrational tax demands and use coercive methods. They should be judged on their performance and not on their achievement of targets," she said.
Yes Bank CEO and Assocham President Rana Kapoor said the government should embark on a five-year systemic programme for disinvestment, especially for non-strategic sectors with a rolling list of targets and aim to disinvest each year equal to about 0.5 per cent of the GDP.
"Government should create a five-year roadmap for recapitalisation of PSU banks and set up a Bank Investment Company under RBI to act as a core investment committee and hold equity shares in PSBs," Kapoor added.
The representatives of trade and industry made various recommendations for consideration in the Budget.
The major suggestions include fiscal consolidation, promoting investment, containing inflation and facilitating ease of doing business among others.
Other recommendations include flag-off strategic sale of loss making PSUs, phased dilution of government stakes in public sector banks to 51 per cent.