Industry body Confederation of Indian Industry (CII) has submitted its agenda for the next budget to the government. It has been requested to reduce personal income tax rates, remove categories of offenses from the purview of the GST law and reconsider the capital gains tax issue.
The CII has suggested keeping the GST law crime-free, saying it has sufficient penal provisions to curb tax evasion. Industry body president Sanjeev Bajaj said capital gains tax rates and holding period need to be revisited to remove complexities and discrepancies.
Bajaj said the government should also consider reducing personal income tax rates in the next phase of reforms as this would increase disposable income which would boost the demand cycle.
The CII said flat tax for businesses should continue and the rate of corporate tax should also remain at the current level. On the other hand, in civil cases, no action of arrest or detention should be made until the offense is proved in the business.
Efforts should be made to reduce the fiscal deficit to six per cent of gross domestic product (GDP) by 2023-24 and 4.5 per cent by 2025-26, the chamber said. In addition, capital expenditure should be increased from the current 2.9 per cent to 3.3-3.4 per cent in 2023-24 and further targeted to 3.8-3.9 per cent by 2024-25. It said that there is a need to increase private sector investment as public sector investment alone is not enough to boost growth in the economy.