Union Budget 2024: In prebudget talks with revenue secy industry bodies ask for tax reforms | Budget 2024 News
Three industry bodies suggested changes in India’s tax regime in their pre-Budget discussions with Revenue Secretary Sanjay Malhotra in New Delhi on Tuesday.
The bodies — Confederation of Indian Industry (CII), PHD Chamber of Commerce and Industry (PHDCCI), and Federation of Indian Chambers of Commerce & Industry (FICCI) — held separate meetings with Malhotra during the day and put across their suggestions for the upcoming Budget.
During their presentation, CII asked for a “marginal relief” in income tax for taxable income up to Rs 20 lakh.
The PHDCCI said the slab of 30 per cent income tax should be raised to income of Rs 40 lakh and above. Below this, the body said, the tax rate should be kept at 20-25 per cent.
“We have suggested to the revenue secretary to take the slab of 30 per cent beyond Rs 40 lakh income so that at least the middle class is spared from this tax bracket, and is taxed at the rate of 20-25 per cent below Rs 40 lakh,” Mukul Bagla, chair of Direct Taxes Committee at PHDCCI told reporters after the meeting.
Hemant Jain, senior Vice President at PHDCCI, said that they have also asked for exemptions to be increased.
FICCI, on the other hand, did not ask for any exemptions and concessions but suggested simplification of taxation in India.
“The entire thrust is on simplification,” said Dinesh Kanabar, mentor at FICCI Tax Committee, highlighting that currently there are multiple rates of withholding taxes and high tax is collected at source. He also said that there were discussions on dispute resolution and that they had suggested simplification of the capital gains tax structure in India.
In its presentation, CII also called the current capital gains taxation structure in India “complex”. It suggested that the holding period for turning long-term for financial assets be kept at 12 months and for other assets at 36 months.
CII further suggested that long-term capital gains tax rate be fixed at 10 per cent for financial assets and 20 per cent for assets like immovable property. For short-term, it suggested that financial assets be taxed at 15 per cent and other assets at the applicable rates. The body also suggested that corporate tax rates be maintained at the current levels to provide “tax certainty”.
For indirect taxes, CII recommended decriminalisation of some offenses under GST and that it should be brought under a three-tax structure.
“The 12 per cent slab could be merged with the 18 per cent slab, to be around 14 or 15 per cent,” it said.
“A negative list of areas may be provided, which may specify cases such as interpretational issues, clerical errors, etc. where prosecution provisions should not be made applicable,” it added.
Pranav Satya, chair of the FICCI Tax Committee, said that the body had earlier put forth its suggestion on GST.
“As a part of the FICCI agenda, we have talked about initialisation of GST 2.0 building on the success of GST implementation, which has achieved both its objectives of removing barriers to trade as well as of a greater formalisation of the economy,” Satya said.
PHDCCI said they have also asked for introduction of faceless assessment in indirect taxation.
“We also suggested that on the lines of income tax, we should be given a faceless assessment scheme (for indirect tax) also,” said Ashok Kumar Batra, chair of the Indirect Taxes Committee at PHDCCI.
“In case it is not possible for you to introduce faceless assessment, at least virtual hearings should be made mandatory wherever they are being requested for,” Batra told the revenue secretary.
First Published: Jun 18 2024 | 7:46 PM IST
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