In view of the government’s initiatives to revive the infrastructure sector, industry body CFI today expressed hope that the upcoming budget will offer substantial relief in direct and indirect taxation and also remove anomalies in tax laws.
“The construction sector plays a pivotal role in the economic growth of the nation and executes key projects, including highways, hydro, thermal and nuclear power, water supply and irrigation, ports and airports, railways, including metro and mono etc,” Construction Federation of India (CFI) said in a statement.
Currently, the construction sector is facing liquidity crisis, mainly on account of blockage of funds with project owners, mainly public sector undertakings and government authorities, coupled with anomalies in tax laws, frequent changes in applicability of tax rates, exemption to such projects and the like, it said.
“The federation hopes that the finance ministry will announce positive tax sops in the budget and also remove anomalies in tax laws,” it added.
Recently, the federation at a pre-budget meeting with the revenue secretary submitted a memorandum on key issues relating to direct and indirect taxes impacting the construction sector.
“One of key direct tax issues raised by CFI is with regard to exemption from provision of domestic transaction under section 92BA in case of contract awarded for the construction industry by central or state governments or other statutory body to consortiums…,” it said.