Amongst the key tax proposals of the industry body is a steady reduction in the 10% surcharge on corporate tax and bringing down the corporate tax from the current 40% to 25% gradually. The proposals are in line with the rates prevailing in other Asian companies and, Ficci feels the initiatives will help the countrys manufacturing sector globally competitive.
Ficci has also asked for exemption of all legitimate business expenses, especially those on sales promotion, to be put outside the ambit of the fringe benefit tax (FBT). Exemption of such expenses from FBT is something which all industries have been asking since FBT was introduced as they are of the opinion that it is not a very valid tax.
High on the list of proposals by Ficci is also finalising the structure of the goods and services tax and a implementation road map. It has also asked that national level value-added tax be levied and central sales tax be phased out next fiscal.
Ficci has also proposed further reduction in indirect taxes, as they amount to over 35% of the final price of the product. It has asked for bringing down excise duty to 12% from the current 14%. It has also proposed reduction in peak customs tariff from 15% to 12.5%. This would help in aligning tariff rates with that of Asean countries.
Service tax collections has witnessed a 61% growth till september this year, amounting to Rs 13,356.86 crore. In view of the phenomenal increase in service tax collection, the industry body has proposed a separate and comprehensive legislation. It has also asked that the clinical trial industry be put out of its ambit as it is in a nascent stage.
Another item on the chambers wishlist is improved quality of tax services as well as better e-filing of returns on the new Form No 1 for income tax and FBT.