Thaindian News

New Delhi, Feb 3 (IANS) Corporate India Friday urged Finance Minister Pranab Mukherjee to push forward key reforms such as the introduction of the goods and services tax in the upcoming budget without tinkering with the indirect tax rates.

“Industry, traders, service providers, investors both from within and outside, everybody expects the 2012-13 Budget would be used to initiate new reform measures to energise growth,” said R.V. Kanoria, president of the Federation of Indian Chambers of Commerce and Industry (Ficci).

Kanoria said indirect tax rates should be kept at the present level. However, he emphasised the need for widening the direct tax base.

“We have made a case for retaining the tax rates at the present level. There should be no increase in corporate tax, service tax and excise tax,” he said.

In the pre-budget consultation meeting, India Inc suggested to the finance minister that there was a need for amendment of Fiscal Responsibility and Budget Management (FRBM) Act with a roadmap for reduction in fiscal deficit in the next five years which would help in infusing a sense of discipline in raising revenues and containing expenditure.

Talking to reporters after the meeting, Confederation of Indian Industry (CII) president B. Muthuraman said he had emphasised the need for widening of tax net and early implementation of goods and services tax (GST).

“We asked for giving infrastructure status to healthcare and education sector. We also sought speeding up of PSU disinvestment, widening tax net and implementing GST as fast as possible,” Muthuraman said.

The business leaders also demanded reduction in interest rates to boost growth.

Most of the business leaders were in favour of reduction in interest rate at least by 50 basis points to send the positive signal to the market, industry and the corporate world at large as well as to boost the investment sentiments, the finance ministry said in a statement after the customary meeting.

“It was also suggested that service tax base may be widened with a negative list and to exempt infrastructure sector companies and SEZ units from minimum alternate tax (MAT),” it said.

President of the Federation of Indian Export Organisation (FIEO) M. Rafeeque Ahmed said interest rates for micro, small and medium enterprises should be capped at 7 percent.

“Interest rate for the MSME sector should be capped at 7 percent and for others at 9 percent; or subvention should be provided to all sectors of exports at least till March 31, 2013,” he said.