Budget 2007 - ASSOCHAM’s suggestions
ASSOCHAM representatives had a meeting with the Revenue Secretary on 30th November and suggested the following:
1. Dual Tax Rate – It has been recommended that services for the mass consumption and non-cenvatable should be taxed at the lower rate of 6% and tax rate should not be increased at all.
2. Exemption limit under the Service Tax should be enhanced from present Rs.4lacs to Rs.10lacs.
3.Now many transactions are subject to VAT as well as Service Tax. This double taxation needs to be avoided in respect of such transactions.
4. For small tax-payers, say turnover uptoRs.25lacs, summary assessment should be started with lower tax rates without giving Cenvat facilities and such assessee should not be subject to any kind of mandatory records, audit etc.
5. Provisions related to settlement should be extended to Service Tax.
6. Provisions related to the Export and Import of Services should be simplified.
7. Service Tax on the actual reimbursement of expenditure on the traveling, boarding & loading should not be levied. Hence, suitable changes should be made in the Valuation Rules.
8. Under the Valuation Rules suitable changes need to be made to avoid tax on taxes.
9. Present Cenvat Rules need to be replaced with new set of Rules to overcome the deficiencies under the present Rules as well as to achieve the objective of integration of Central Excise and Service Tax.