Industry chamber Ficci on Monday demanded that the government should not make any move towards Inheritance tax in the upcoming Budget. The chamber has also called for implementation of the recommendations made by the Parthasarathi Shome committee on GAAR along with making the final recommendations public.
In its pre-budget recommendation to the Revenue Secretary Sumit Bose, the industry lobby group said, “Ficci recommends that the final reports of the Shome and Rangachary Committees are placed in the public domain and recommendations acted upon. There is a danger that the deliberations of these Committees will be perceived as one more symbolic exercise with little result to show.”
Opposing the move of introducing inheritance tax in the budget, Ficci President RV Kanoria said, “To impose a tax which could potentially require a promoter to dilute his shareholding in a company merely to pay inheritance Tax is likely to prove to be completely counter-productive. We strongly oppose any imposition of Inheritance Tax.”
In order to deal with the issue of accumulation of wealth, Finance Minister P Chidambaram had said the time had come for a debate on imposition of inheritance tax.
“Sometimes, I doubt whether we have taken moderation (in tax rates) too far. Have we paid little attention to accumulation of wealth in few hands? I am still hesitant to talk about inter-generational equity and therefore inheritance tax. I think these are the questions we should debate,” he had said. Also, demanding speedy tax refunds, Kanoria said, “Tax payers are indeed concerned about the substantial refunds pending at the tax office on account of both Direct and Indirect taxes. All pending refunds need to be granted forthwith, even when a case is chosen for scrutiny assessment.”
The chamber also called for improving dispute resolution mechanism and immediate implementation of Goods and Services tax (GST).
Earlier this month, Assocham, in its pre-budget memorandum to the finance ministry, had called for raising the tax exemption for individuals to Rs 3 lakh from the existing limit of Rs 2 lakh. The chamber also called for bringing down the service tax and excise duty to 8 per cent which are at 12 per cent at present.