Industry bodies met revenue secretary Sanjay Malhotra on Thursday to outline their tax proposals.
They included the Confederation of Indian Industries (CII), Federation of Indian chambers of commerce and industry (FICCI) and PHD chambers of commerce and Industry (PHDCCI). The meeting was part of the government’s customary pre-budget consultations for the upcoming budget.
FICCI sought comprehensive tax reforms and simplification of compliance to enhance ease of doing business, relaxed tax deducted at source (TDS) provisions, rationalisation of capital gains tax regime, streamlining of customs procedures and a dedicated dispute resolution mechanism.
The CII suggested further reforming the goods and services tax (GST) regime by introducing GST 2.0 and moving to a three-rate structure. It also called for further simplification of compliances and covering all expenses under the input tax credit chain.
“We have sought further relief in taxation for the people in the lower income bracket, inflation targeting and relief for people getting direct benefit transfers,” said Sanjiv Puri, president, CII.The PHDCCI sought a reduction in tax rate for partnership firms and limited liability partnership firms and removal of dividend distribution tax. It also sought lower tax for share buybacks and delisting of listed subsidiaries to be considered tax neutral.India Inc also suggested that buyback of shares may be treated as capital gain in the hands of the shareholder and taxed at the applicable rates after allowing deduction for the cost of shares.
On indirect taxes, the industry bodies sought a single certificate of origin for multiple bills of entry, permitting filing of a single appeal before commissioner appeals against multiple bills of entry assessments and extending authorised economic operator (AEO) certification benefits to newly incorporated companies of AEO-accredited groups.
The industry also pitched for zero customs duty for certain critical raw materials.