I propose a lower rate corporate tax structure without exemptions
31st January, 2018: The Indian economy is poised
for takeoff. There has to be a major thrust from all the sectoral engines for growth.
My strategic approach would be the following:
Among the first things that I will do is consolidate and accelerate reforms to ensure
that benefits percolate to the common man. For instance, in agriculture, while the
focus has been on minimum support prices, I would like to stimulate cold storage
infrastructure and proper warehousing to minimise loss of produce to ensure food
security, fair remuneration and stable pricing. We have the potential to become
one of the largest food suppliers in the world; organic farming and usage of drip
irrigation will be encouraged.
While ‘Make in India’ is laudable, the existing manufacturers need a clear direction
road map and stable policy regime. To cite an example is the inverse duty structures,
which will be corrected wherever required to benefit domestic manufacturers.
Additionally, a stable and moderate tax regime with a clear road map and ease of
doing business will be the thrust. Even the US is making efforts by slashing the
corporate tax rates. I propose a lower rate tax structure without exemptions. Any
ambiguity on minimum alternate taxation regime will be removed.
Real estate will be another focus sector where construction will lead to creation
of housing/employment/ and drive demand for cement /steel and housing materials.
The thrust on affordable housing will be sustained and widened to one level up.
Manufacturing competitiveness overall and export infrastructure like ports will
be given a special thrust. The exports sector as our foreign exchange earnings need
to be secured keeping in mind the volatility of oil prices coupled with currency
fluctuation have the potential to derail our economy.
Another sector that brings in huge foreign exchange earning and employment potential
is tourism. Tourism-related infrastructure /educational institutions and hotel taxation
will be adequately focused on, to attract international and domestic tourism.
Equally important are power sector reforms and energy security, which will enable
us to achieve the above objectives. We are in the process of shifting to greener
fuel and renewable energy, I would ensure that measures are in place to stimulate
infrastructure and attract investments.
In a parallel thrust, the small and medium enterprises would need to be facilitated
as they can significantly contribute to informal employment thus adding purchasing
power at the bottom of the economic pyramid.
After the introduction of GST, indirect tax regime has a clear road map. The focus
will now be on direct taxes by widening the tax base, simplifying it, reducing personal
taxation.
To be a global leader, we must establish innovation and incubation centres for future
technology. Our investments on R&D need to be at par with advanced nations. To encourage
and achieve this, I propose that spends on R&D be allowed 200 per cent deduction
for another 10 years.
Disclaimer: The views expressed in the article above are those of the authors' and
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Source: http://businessworld.in/article/A-Stable-Moderate-Tax-Regime/31-01-2018-138848/