Pre-Budget Discussion, Finance Minister Meets Industrialists

By: EconomyWatch   Date: 30 June 2010

About The Author

EconomyWatch

The core Content Team our economy, industry, investing and personal finance reference articles.

EconomyWatch, Content Team

 

  • Dot Div
  •      

The Union Finance Minister, Shri P. Chidambaram met representatives of industry, industry associations and chambers of commerce as part of his pre-budget consultations with various interest groups and experts. The Finance Minister opened the discussion by requesting the participants to give their views on specific actionable points- tax and non-tax - to impart a new impetus to growth and investment by removing the existing obstacles.Some of the important suggestions made by the participants during the meeting are as follows:

General:

  • Provide incentives for Research and Development (R&D) activities for all sectors;
  • Set up a Skill Development Bank and facilitate intermediation of knowledge;
  • Encourage investment in the infrastructure sector by providing/enhancing tax exemptions for such investment;
  • Move towards an effective GST rate of 15 per cent in the next few years;
  • Promote India as a Corporate Headquarter by giving tax incentives;
  • Give infrastructure status to gas pipelines and associated storage facilities and mega steel projects;
  • Give exemptions for investment in agriculture related sectors like cold-chains etc;
  • Increase depreciation rate to 25 per cent per year for tax purposes;
  • Remove Fringe Benefit Tax (FBT) on expenditure incurred on sales promotion;
  • Remove anomalies in the Cutsoms and Excise duty structures;
  • Provide incentives for Indian companies to become global.

Industry Specific:

Small Scale Enterprises(SSI):

  • Increase limit for excise exemption to Rs.3 crore and rationalize excise duty rates to provide a phasing in of the increase in the rates;
  • Remove anomalies in the excise duty structure;
  • Remove FBT on small and medium enterprises;
  • Ease depreciation norms;
  • Increase tax audit exemption limit;

Drugs and Pharmaceuticals:

  • Enhance abatement norms from the existing level to 45 per cent of MRP;
  • Remove withholding taxes on R&D and include expenses on clinical trials in R&D;
  • Include overseas expenditure on R&D for exemption purposes;
  • Set up training institutes for biotechnology.

Textile:

  • Extend the Textile Upgradation Fund (TUF) by another five years ;
  • Provide capital subsidy for processing hubs;
  • Provide support system for relocation of old existing units.

Telecommunications:

  • Decrease the total tax burden on this sector by rationalizing multiple duties and charges;
  • Do away with the requirement of financial and performance guarantees;
  • Simplify and rationalize customs duty on software for telecom industry;

Information Technology:

  • Facilitate setting up of seed funds/angel funds to address lack of innovation;
  • Provide incentives for setting up rural electronic infrastructure facilities;
  • Remove complications in IT related tax structure and bring down litigations.

Tourism:

  • Provide “infrastructure” status to tourism industry;
  • Earmark funds collected for maintenance of heritage structures;
  • Increase budgetary allocation for promotion of India as a tourist destination.

Source: PIB


  • Dot Div
  •      

Most Popular in Indian Budget

Related Links
blog comments powered by Disqus