Reduce tax on household items to spur demand: AssochamJune 10th, 2009 - 5:54 pm ICT by IANS
New Delhi, June 10 (IANS) The Associated Chambers of Commerce and Industry (Assocham) Wednesday called on the government to bring down tax on household purchases to less than 20 percent from over 45 percent now to spur domestic demand.
“Although the annual income of an average Indian is growing significantly, it is not resulting in increased savings because the government takes away over 45 percent on household purchases in terms of indirect taxes alone,” Assocham president Sajjan Jindal said in a statement.
The growth in private consumption expenditure, currently at around 6.5 percent, should be taken to 7.5 percent to boost demand, he added.
Assocham has also devised a 10-pronged strategy to achieve 12 percent manufacturing growth this fiscal.
The suggestions, submitted to the finance ministry by Jindal, includes withdrawing hurdles on investments in power, telecom and other core infrastructure sectors by way of giving them necessary clearances within maximum 45 days and easing regulations for the small and medium enterprises (SME) sector.
Government controls and several regulations are currently restricting the growth of the SME sector, which contributes to half of the country’s manufacturing output, the industry lobby said.
“In the industrial production, the weightage of manufacturing is the highest and naturally it is a matter of concern that neither our industry nor manufacturing is doing as per expectations,” it added.
If the manufacturing sector has to grow 12 percent a year, power generation must have a sustained annual growth of 10 percent, said Assocham.
- India's energy consumption to double by 2031: Study - Jul 25, 2012
- Crisil to target SMEs in tier II, III towns - Feb 22, 2012
- Tax hikes to hit household budgets - Apr 01, 2012
- Animation sector yet to get support, rues industry - Oct 28, 2010
- Double-digit growth will need key reforms: new CII president - Apr 25, 2011
- $2 bn aerospace, defence exports by India in 2011-12: Assocham - Jan 27, 2012
- Business sentiments worse than reality: Adi Godrej (Interview) - Apr 23, 2012
- Trade between India, Japan set to rise: Envoy - Jul 10, 2011
- Construction equipment industry eyes $23 billion revenues - Nov 22, 2011
- Gems, jewellery sector turnover to double by 2015: Assocham - Jul 22, 2011
- Survey gung-ho on growth, but predicts higher inflation (Lead) - Feb 25, 2011
- Small, medium sector to be economic activity hub: Industry - Dec 27, 2009
- FICCI calls for radical policy reforms in energy sector - May 07, 2012
- Realty business hots up in Bengal - Jun 03, 2012
- Inflation to remain between 6.5-7.5 percent: Mukherjee (Lead) - Jun 14, 2012
Tags: assocham, chambers of commerce, chambers of commerce and industry, core infrastructure, finance ministry, government controls, household items, household purchases, hurdles, indirect taxes, infrastructure sectors, jindal, manufacturing sector, necessary clearances, power generation, private consumption expenditure, pronged strategy, sajjan, small and medium enterprises, weightage