Confederation of Indian Industry (CII) in its Pre budget memorandum for Union Budget 2012-13 has asked the government to announce initiatives that can accelerate the pace of private investments.
- In an important note they have recommended to raise depreciation rates for plant and machinery from 15 per cent to 30 per cent, at least for a period of two years to encourage more capital investment.
- Higher depreciation rate of 50 per cent in case of retrofitting technologies, which are more energy efficient and environment friendly in order to encourage companies to go green
- Retain the current rates of excise and service tax to spur investment by industry
- Money received from sale of an asset be exempted from capital gains tax
- CII has favored reintroduction of Section 10(23G), which allowed exemption of interest and long-term capital gains when lent for Infrastructure related initiatives.
- CII recommends weighted deduction of 200per cent on in-house R&D be extended to all sectors in order to make India an attractive base for R&D.
- They have also proposed a 16-point
- In case the Large Industry (private and public sector) buys minimum of 20per cent of its goods/ services from MSEs, subject to the transaction having been completed in the form of payment to MSE within 45 days, the large Industry would be entitled to a tax benefit.
- Need to promote factoring as an alternative and mandated under the MSMED Act 2006. Promote first generation entrepreneurs and green field ventures, there is a need to establishment of a Venture Capital fund with a corpus of Rs 10,000 crore (Rs 100 billion).
- RBI may constitute a group along with the Indian Banks Association and the credit rating agencies to work out a uniform credit rating format and processes to bring about transparency and speed to this important issue.
- Encourage FDI participation by NRIs in the SME sector. Emphasis on developing skills that are needed more by MSMEs, who do not have resources to provide post employment in-house training resources.
