What India Inc expects from the budget

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What India Inc expects from the budget

Captains of India Inc presented their budget wishlist to the finance minister today. As expected, the list is long and encompassing a wide range of issues, including tax rates, stimulus and rate cuts. Aakansha Sethi of CNBC-TV18 rounds up the report.

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Excerpts from Reporter's Diary on CNBC-TV18 Watch the full show »

Captains of India Inc presented their budget wishlist to the finance minister today. As expected, the list is long and encompassing a wide range of issues, including tax rates, stimulus and rate cuts. Aakansha Sethi of CNBC-TV18 rounds up the report.

The meeting of the industry representatives with the Finance Minister lasted almost two and half hours and as with every year, there were several demands to reduce tax rates.

However, the key takeaway from the meeting was that the industry felt that in a year when fiscal consolidation is going to be a key challenge for the government, it should focus on revenue mobilization through non-tax revenues rather than tax revenues. Hence, the disinvestment process should be speeded up and government assets should be monetized.

Also, they felt that business sentiment needs to be addressed and growth needs to be simulated and for this, the government should not withdraw the fiscal stimulus and should not hike service tax and excise rates to pre-2008 levels.

Other demands included removal of infrastructure from the minimum alternative tax (MAT) levy, reduction of the MAT rate, removing the cascading impact of the dividend distribution tax (DDT), as well as ensuring that interest earned by foreign lenders in overseas borrowing should be tax exempt. The industry also felt that interest rates must be brought down as soon as possible.

"We have had an excellent meeting and number of points has been made," says B Muthuraman, president, CII. "From giving infrastructure status to health and education, speeding up PSU disinvestment, introducing dual pricing for LPG and diesel, widening the tax net, implementing GST as fast as possible, to bringing urea under nutrient based subsidies were discussed," he says.

Nitin Paranjpe, CEO of HUL says that the larger comments that everyone was making was in the space of taking actions which could address sentiment, start getting step up in investment, capital formation, agricultural productivity. "There are two key policies which have been talked about- GST, DTC etc and finding a roadmap for that," he says.

So those are the industries' demands. What remains to be seen is that in a year when the Finance Minister is going to be constrained on the revenue front, will he listen to these demands?