India Inc calls for lower corporate tax
The Tribune , Dec 07, 2017
Corporate India today sought lower tax and more incentives for investments while exporters called for quicker GST refunds at a meeting with Finance Minister Arun Jaitley in the run-up to the last full-year Budget of the NDA government before 2019 General Elections.
The industry bodies suggested lowering the corporate tax to 18-25%, from up to 30% at present. The exporters, who are grappling with blockage of working capital, pressed for exemption from tax on export income or lower levies on forex earnings and faster clearance of GST refunds.
“The Finance Minister has promised 25% corporate tax rate long ago and we expect he will fulfil his promise in this Budget,” FICCI president Pankaj Patel said.
The industry body also sought support for innovation, employment generation through investment in the MSME and startup sector and specific incentives for new investments, highlighting the need to establish an export zone with manufacturing facilities but without any taxes or regulations.
“We have asked to reduce the corporate taxes. Across the world, people are reducing corporate taxes and India is among the highest. We do need to create more demand and capacities for private investment and if you see today, GST has increased the tax rates,” CII president Shobana Kamineni said.
“The implementation (of GST) and refund delays are a cause of concern, so we have suggested that if they can give us the IGST refund also, along with the drawback. In the US, there is a differential tax rate for export earnings, so we have sought a lower rate of tax on export earnings than the normal corporate rates,” EEPC India Working Committee Member PK Shah said.
According to Shah, refunds of exporters to the tune of at least Rs 60,000-70,000 crore are stuck post- GST rollout in July.
“We have asked the FM to take the corporate tax to 25% comparing with developed and industrialised nations. This would help in investment and which, in turn, would increase employment opportunities. Dividend distribution tax, which is around 20%, should also be lesser,” said Assocham president Sandeep Jajodia.