India Inc needs scheme like Vivaad se Vishwas, says Sunil Bharti Mittal

Says government must launch Vivad se Vishwas scheme for corporates to release locked funds, backs a uniform 25% tax rate and 'one nation, one election' for economic efficiency

The government should bring out a ‘Vivad se Vishwas’ tax scheme for India Inc to free up ‘lakhs of crores of rupees’ currently tied up in corporate litigation, Bharti Enterprises Chairman Sunil Bharti Mittal said on Thursday. While speaking at the CII Annual Business Summit, Mittal said it was surprising that many corporates haven’t moved to the 25 per cent corporate tax rate. 

Released in 2024 to resolve pending appeals in case of income-tax disputes, the Vivad se Vishwas scheme should be reimagined for corporate India to ensure the Centre can get "large amounts of money that can be put to good use", Mittal said.

 

 

 

“Maybe the government will win in 10 years time and that money may become available to it then. Why not settle it now on the lines of the Vivad se Vishwas?” Mittal argued, pointing out that it would release the industry from its past litigations and allow them look into the future.

 

Mittal’s comments assume significance given that Bharti Airtel & Bharti Hexacom remain engaged in efforts to reduce the hefty ~43,980 crore of adjusted gross revenue (AGR) dues owed to the Centre.

 

He said the government’s decision to establish a 25 per cent corporate tax was a fine example of policy making.

 

As part of a larger tax plan being implemented since 2016-17, the Centre had extended the simplified 25 per cent rate for certain companies during the FY20 Budget. The exemptions were foregone to all domestic firms with an annual turnover of up to ~400 crore, up from ~ 250 crore.

 

The policy change aimed to benefit around 99.3 per cent firms, but many are yet to move to the new regime. “Let’s also get rid of the old fascination with exemptions and move on to a simplified flat 25 per cent tax rate,” said Mittal. 

 

He argued that India loses valuable economic opportunities a few months each year due to elections, and that the industry should support ‘one nation, one election’.

 

Pointing out that bilateral talk for free trade agreements (FTAs) with the US, European Union, and Saudi Arabia are at advanced stages, Mittal said the industry associations should not ask for things that will make the talks difficult. "We should have a reasonable outcome for those markets to open up for Indian companies, for those markets to be available to us, as we open our markets," he said. 

 

However, he strongly called for import substitution, arguing that every rupee of import saved by manufacturing domestically, resulted in equal amounts of valuable foreign exchange saved. 

 

Mittal said the world is becoming less open to immigration despite societies ageing globally. “Our young people, engineers, nurses, doctors, teachers are not going to get as easy access as they've had in the past. Thankfully, the world has moved to a digital medium. From the comfort of the homes, they can serve the globe,” he said.

 

Mittal pointed out that job creation needs to be prioritised. “One and a half million engineers are being produced in the country every year, more than the US and China put together. All of them need to be harvested,” he said.

 

He also called upon industry to invest much more to tap the hydrocarbon potential of the North East.