Industry Bodies Seek Tax Reforms Ahead of Union Budget

ENA Economy 2024-06-19 14:51:34 New Delhi, Jun 19 (KNN) Leading industry associations in India have put forth a series of recommendations to the government for overhauling the country's tax regime as part of pre-Budget consultations held on Tuesday. The demands were presented to Revenue Secretary Sanjay Malhotra in separate meetings with the Confederation of Indian Industry (CII), PHD Chamber of Commerce and Industry (PHDCCI), and the Federation of Indian Chambers of Commerce & Industry (FICCI). A key ask from the industry bodies relates to providing relief to the middle-class taxpayer. The CII has proposed a marginal relief in income tax for those with taxable income of up to Rs 20 lakh per annum. Similarly, the PHDCCI has suggested increasing the 30 per cent tax slab to incomes above Rs 40 lakh, thereby taxing those below this threshold at 20-25 per cent. Recommendations have been made to simplify the capital gains taxation structure, which the CII deems complex currently. Its proposal entails setting the holding period at 12 months for financial assets and 36 months for other assets like immovable property to qualify as long-term. Furthermore, it suggests capping long-term capital gains tax at 10 per cent for financial assets and 20 per cent for physical assets, while short-term gains could be taxed at 15 per cent and prevailing rates, respectively. On the indirect taxes front, the industry has batted for decriminalising certain offenses under the Goods and Services Tax (GST) law and moving towards a three-slab GST structure by merging the existing 12 per cent and 18 per cent rates. The CII has proposed a rate of around 14-15 per cent for this consolidated slab. Additionally, the PHDCCI has urged the introduction of a faceless assessment scheme for indirect taxes, akin to the income tax framework. The FICCI, meanwhile, has called for the initiation of GST 2.0 to build upon the success of the comprehensive indirect tax reform implemented a few years ago. Ensuring tax certainty and streamlining dispute resolution mechanisms have also been highlighted by the industry representatives. The CII has recommended maintaining corporate tax rates at current levels, while the FICCI has proposed simplifying the tax structure and addressing issues around high withholding taxes and tax deducted at source. As India gears up for the annual Budget presentation, due in mid-July, all eyes are on the government's response to these recommendations from the country's leading industry bodies. Striking the right balance between boosting economic growth, enhancing tax compliance, and protecting taxpayer interests will be the key challenge for Finance Minister Nirmala Sitharaman and her team. (KNN Bureau) 38263 https://knnindia.co.in/news/newsdetails/economy/industry-bodies-seek-tax-reforms-ahead-of-union-budget 2024-06-19 14:51:34 knnindia.co.in Industry Bodies Seek Tax Reforms Ahead of Union Budget