Negative list: Industry expectations from Budget 2013
While the negative list regime widened the tax base by bringing in more services under the tax net, no corresponding changes were made in the Cenvat credit scheme, which continues to provide restricted benefit to the assessees. As the country prepares itself for the transition to the GST regime, the Budget 2013 has to eliminate the limitations imposed under the current scheme and facilitate its seamless integration into the negative list regime.
Along with the negative list of services, the new regime also provides exemptions to certain sectors. There is an urgent need to review this list as, in the absence of a positive list-based categorisation of services, many services in the critical sector remain unattended. For example, while maintenance and repairs of roads is covered under infrastructure-related exemptions, ‘management’ of roads (which was exempt under the earlier regime as ‘management, maintenance and repair service’) does not find a place in the said exemption. Similarly, while care has
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