Demonetisation: In pre-Budget 2017 meet with Arun Jaitley, bankers seek tax sops

By: |
New Delhi | Published: December 21, 2016 6:28:05 AM

Representatives of the financial sector, in a pre-Budget meeting with finance minister Arun Jaitley on Tuesday, sought a slew of tax incentives to deal with the impact of demonetisation and the surge in non-performing assets.

arun jaitley, arun jaitley demonetisation, demonetisation arun jaitley, jaitley cashless economy, finance minister arun jaitley, arun jaitley rbi“There is need for full tax exemption for NPA provisioning by the banks keeping in view their profitability,” the bankers told Jaitley (ANI)

Representatives of the financial sector, in a pre-Budget meeting with finance minister Arun Jaitley on Tuesday, sought a slew of tax incentives to deal with the impact of demonetisation and the surge in non-performing assets. They also demanded higher capital infusion in the public sector banks.

“There is need for full tax exemption for NPA provisioning by the banks keeping in view their profitability,” the bankers told Jaitley, according to a statement issued by the ministry.

With deluge of deposits in the banking sector post demonetisation, bringing down deposits rates, bankers said some sort of exemption needs to given to senior citizens under the income tax Act so that they have a decent income through their deposits.

You May Also Like To Watch This:

To incentivise digital payments, the bankers urged tax rebate to shopkeepers for using digital means and for better compliance. Same way, consumers may also be given a tax rebate if their digital purchases are more than a certain amount.

They also sought exempting transactions of banking correspondents from the service tax. The financial sector representatives sought a provision in the Budget that if an insurance company or mutual fund employing a certain number of people increases the number of jobs by a certain degree, then 2-3% tax relaxation would be given to it.

This will directly link tax rates with job generation.

Do you know What is Finance Bill, Short Term Capital Gains Tax, Fiscal Policy in India, Section 80C of Income Tax Act 1961, Expenditure Budget? FE Knowledge Desk explains each of these and more in detail at Financial Express Explained. Also get Live BSE/NSE Stock Prices, latest NAV of Mutual Funds, Best equity funds, Top Gainers, Top Losers on Financial Express. Don’t forget to try our free Income Tax Calculator tool.

Next Stories
1Budget 2017 to focus on wealth redistribution, government may raise income tax exemption limit: CLSA
2Budget 2017: Bankers urge Jaitley to hike TDS exemption limit on FDs for senior citizens to Rs 50,000
3Budget 2017: FM Arun Jaitley hints at no populist measures for railways