Rediff.com« Back to articlePrint this article

Union Budget: BSE seeks cut in Securities Transaction Tax

July 07, 2014 14:32 IST

Bombay Stock ExchangeTo attract more investors into the stock market, Bombay Stock Exchange has recommended to Finance Minister Arun Jaitley for reduction in Securities Transaction Tax and rationalise the taxation norms for different financial products.

BSE demands STT to be reduced for delivery transactions as it would also help in attracting investments.

BSE believes that, currently STT is lowest on options and highest on delivery transactions.

So, effectively the tax policy itself indirectly promotes the derivatives transactions.

Bio-technology industry seeks $5-billion support

The Association of Biotechnology Led Enterprises, the apex body of the biotech sector in India, has sought an increase in weight tax deduction and extending its applicability to activities such as clinical trials and setting up venture capital funds.

The Indian bio-technology industry has urged the government to make bio-manufacturing the next big opportunity after generics.

The Association of biotechnology-led enterprises has requested the government to invest $ 4-5 billion each year (Rs 24,000 to Rs 30,000 crore or Rs 240-300 billion) over five years to expand the bio-tech industry to $100 billion by 2025.

In its pre-Budget recommendation to the government, the association sought an allocation of Rs 500 crore (Rs 5 billion) every year from the research and development cess to the Technology Development Board to stimulate the biotech sector.

Corporate Social Responsibility funds may be used for the public good and socially relevant research through partnership with the Biotechnology Industry Research Assistance Council of the Department of Biotechnology.

All such contributions to BIRAC should be fully tax-exempt, the association said.

As of now only incubators in academic institutions are eligible for availing CSR funds for promoting innovation.

This was passed as a government order last year.

This should be extended to all incubators and science/bio-tech/knowledge parks, whether they are part of academic institutions or not, said the association.

CII asks for extending stimulus package in Union Budget

Industry body Confederation of Indian Industry has asked for extending the short-term stimulus package, early roll-out of Goods and Services Tax and rationalisation of subsidies, among other measures, in the Union Budget 2014-15.

"CII has strongly urged for early implementation of GST as a surefire means of lifting investor sentiment and putting the Indian economy back on track.

“We have also suggested the extension of short-term stimulus package involving reduction of excise duty on certain goods up to March 31, 2015," CII said in a statement.

The industry body CII also asked the government to slash the excise duty rate from the current level of 12 per cent to 10 per cent across-the-board to revive demand in the economy.

The industry chamber further suggested that a 10 per cent rationalisation of subsidy expenditure could result in savings to the tune of Rs 25,000 crore (Rs 250 billion).

Among other suggestions, it called for a holding company structure model for public sector unit banks, dilution of government stake in public sector banks to 51 per cent and aggressively pursuing disinvestment for revenue generation.

To expedite clearances to a higher number of projects, CII suggested that the threshold limit of Cabinet Committee on Investments be reduced from the current level of Rs 1,000 crore (Rs 10 billion) to Rs 500 crore (Rs 5 billion).

To provide a fillip to manufacturing, the industry chamber recommended investment allowance as an incentive for capital formation in the manufacturing domain.

It also asked the government to consider tax incentives such as allowing 25 per cent accelerated depreciation for investments in plant and machinery, reducing minimum alternate tax and dividend distribution tax rates to 10per cent.

Among other suggestions, CII pitched for a simple, stable and non-adversarial tax regime.

"Doing away with retrospective amendments, abolition of MAT on infrastructure and special economic zones, improving the dispute resolution mechanism by designating it as a quasi judicial body and providing a timeline for implementation of reforms in tax administration would restore India as an attractive destination for doing business," it said.

Consumer durables makers seek cut in duties-CEAMA

The Consumer Electronics and Manufacturing Association has asked the government to take steps such as reduction in customs and excise duties on consumer durable products and rapid implementation of GST.

In its budget wish-list, the industry body also asked the Finance Minister to remove inverted duty structure (driven by foreign trade agreements) on consumer electronics products and appliances which is making the Indian manufacturing sector uncompetitive.

According to CEAMA, Industry has been reeling under intense pressure because of sluggish demand, onslaught of concessional imports under FTAs and heavy taxation.

With the coming-in of the new government, CEAMA is hopeful that its recommendations will be taken up for considerationand efforts will be made to provide the industry with immediate relief.

The association has called for reduction in excise duty on production of energy efficient products and removal of inverted duty structure.

It has also sought faster implementation of GST to decrease compliance burden for businesses as well as reduce paper work while making tax system simpler and transparent.

The industry body also called for reduction of customs duty on LCD/LED televisions to 0 percent to provide a level-playing field to domestic manufacturers.

It has asked for reduction of customs duty on the import of magnetron and other inputs for manufacture of microwave ovens and reduction of customs duty on project imports to 0 per cent.

"Reduce customs duty on project imports to 0 per cent to enhance manufacturing set-ups and invite new technologies/investments into India, furthering the objective of making it a manufacturing hub,"CEAMA said in its budget wish-list.

GJEPC seeks duty cut on gold to 2per cent, scrapping 80:20 rule

The Gems and Jewellery Export Promotion Council has urged the government in pre-budget presentation to reduce import duty on gold and silver to 2 per cent from 10 per cent.

GJEPC has also demanded for scrapping the existing 80:20 scheme, which was imposed by the government in August last year, under which nominated agencies are allowed to import gold on the condition that 20 per cent of the inward shipment will be exported.

GJEPC has requested the government to relook at the policy and create a level-playing field for Indian jewellers by reducing import duty on gold and silver to 2 per cent.

Currently, the 10per cent duty as applicable makes the operations of smuggling economically viable.

If the import duty is rolled back then the menace of gold through smuggling route will not be any productive andhence the leakage will be prevented, GJEPC said in a presentation to the Finance Ministry.

If the import duty is reduced then it will also bring down the transaction cost of exports.

Also, now it is appropriate time to scrap 80:20 scheme as current account deficit is under the required limits.

The gems and jewellery exports fell by about 9per cent to $39.5 billion in the last fiscal from $43.34 billion in 2012-13, mainly due to decline in imports of raw gold and silver.

GJEPC also pointed out that import of both gold and silver dipped 40 per cent cent to $33.46 billion in 2013-14.

In august last year, the government had raised import duty on gold and silver to 10per cent to curb the surging imports and burgeoning CAD.

Powered by

Please click here for the Complete Coverage of Budget 2014 -15