Bold reform measures to sustain high growth trajectory figure high
Prime Minister’s Economic Advisory Council (PMEAC)
- Exit from stimulus.
- 9.0 per cent growth in 2011-12.
- Inflation at 7.0 per cent by March 2011.
- Contain inflation by focusing both on monetary and fiscal policies and supply side management.
- Pace of infrastructure creation has to be stepped up with renewed focus on the power sector.
- Continue efforts to contain current account deficit at 2-2.5 per cent of GDP and in parallel encourage flow of external investments into the country.
- Greater attention to agriculture including on seed development, management of water and soil fertility and improving delivery system
- Urgency in the implementation of goods and services tax (GST).
- Budgeted level of fiscal deficit and revenue deficit still beyond comfort zone.
Economic Survey 2010-11
- Better convergence of schemes to avoid duplication and leakage.
- Private sector participation in social sectors.
- Huge capacity addition in infrastructure in a time bound manner.
- Urgent need to streamline land acquisition and environmental clearances for infrastructure projects.
- Bringing parity between the compensation package admissible under the Land Acquisition Act, 1984, and that applicable to land acquisition under the National Highways Act, 1956.
- Investment in building managerial and technical capabilities of executing agencies at par with the private sector.
- Second Green Revolution with technological break-through in agricultural sector.
- Prioritisation of targeted development of rainfed area and effective marketing links be ensured for better returns to the farmers.
- Further improvements in the Mahatma Gandhi National Rural Employment Guarantee scheme.
- Efficient taxation of goods and services by a new GST.
- Need to explore avenues for increasing investment in infrastructure.
- Need for deepening of the corporate bond market.
- FDI in retail.
- Inflation continues to be a cause for concern. Global economy on the upturn, to support growth momentum.
- Trade deficit set to narrow.
- Focus on Aam aadmi and higher funds for flagship programmes, implementation key to realizing the desired outcomes
Industry Chambers Confederation of Indian Industry (CII)
- Encourage private sector participation through various tax measures, including 150% tax exemption on expense incurred on new technology and inputs.
- Do away with the levy of MAT on infrastructure companies as it has diluted the incentives provided under section 80-IA to the sector.
- Reintroduce of Section 10 (23G) of the Income Tax Act, which provided tax exemption of interest and Long Term Capital Gains in the hands of infrastructure capital companies.
- Increase deprecation rates on plant & machinery from 15 percent to 25 percent and extending R&D incentives available u/s 35 (2AB) to all sectors.
- FDI in multi-brand retail should be opened up, higher FDI should be allowed in the defense sector.
- Early passage of Insurance Bill to raise the FDI limit from 26% to 49%.
- Develop a deep and liquid corporate bond market.
- Continue with the existing peak rate of customs duty (10%). Status quo on the general rate of 10% excise duty and 10% services tax, since these are at par with the proposed Central GST rate of 10%.
- Reduce CST from 2% to NIL, since no credit is available on this tax.
- Reduction in the corporate tax rate from 30% to 25% together with abolition of surcharge and cess.
Federation of Indian Chambers of Commerce and Industry (Ficci)
- No rollback of stimulus.
- Abolish surcharge and education cess.
- Reduce Corporate tax rate to some extent.
- Remove cascading impact of Dividend Distribution Tax.
- Rationalize the MAT as a specified percentage - 50 per cent - of basic corporate tax rate.
- Extend the period of profit-linked incentives provided for infrastructure and crucial sectors (including for developing industrial parks and for power generation), for some more time.
- Make the investment-linked incentive really meaningful, by allowing the losses of specified business of the assessee to be set-off / carry-forward from his other profit-making businesses, instead of restricting it to only from his specified businesses.
- Restore withholding tax exemption on interest payable on foreign commercial borrowings, as also the tax exemption of interest income of an infrastructure capital fund / an infrastructure capital company.
- Peak customs duty rate of 10% needs to be retained for sometime more.
- CST rate be reduced from 2% to 1% with effect from 1st April, 2011.
- Extend tax holiday benefit for EoUs and undertakings involved in FTZs for another 2-3 years.
