Credibility, Continuity and Clarity from Budget
IN a pre-consultation meeting with the Finance Minister, CII pressed for an amendment of the Income tax act which would promulgate the reversal of retrospective amendment and make all taxation prospective. A simple, transparent and non-adversarial tax regime bereft of complexities and ambiguities would go a long way to strengthen business sentiment and restore faith of the foreign investor in the India growth story, according to CII.
CII suggested:
A fresh thinking on the direct tax code is required, which would make it simple and exemption free. A low tax framework for direct taxes should be evolved, going forward, without looking at DTC as the base.
To boost investment in manufacturing sector, the threshold limit of investment allowance should be reduced to Rs. 50 crores which would encourage mid-sized companies to participate as well. The quantum of deduction should be enhanced to 25% of investment.
Creating a framework for settling tax disputes without going into litigation.
A pro-growth budget which makes a bold statement on reforms would go a long way to effect a turnaround in sentiment and mark a return to growth. The economy is at an inflexion point and is awaiting remedial action. CII is looking for Credibility, Continuity and Clarity from the Budget.'