Finance Minister Arun Jaitley on Saturday proposed a series of measures to mobilise resources and slash customs duties to boost domestic manufacturing under the “Make in India” initiative for the creation of jobs.
In a clear message to investors that the government would not levy any retrospective taxes, Jaitley proposed to defer the applicability of the General Anti-Avoidance Rule (GAAR) by two years.
The finance minister also proposed to reduce the rates of basic customs duty on certain inputs, raw materials, intermediates and components so as to minimise the impact of duty inversion and reduce the manufacturing cost in several sectors.
As per the Budget proposals, duties would be reduced to spur manufacture of electrical insulators, insulated wires and cables, microwave ovens, refrigerator compressors, catalytic converters, fertilisers and digital still-image video cameras.
Jaitley has also proposed to slash basic customs duties on LCD/LED, OLED TV panels, optical fibre cable, components required to manufacture lathe machines, flexible medical video endoscopes.
In a bid to promote entrepreneurship, the Centre has proposed to reduce the rate of income tax on royalty and fees for technical services from 25 per cent to 10 per cent.
Jaitley said the move would facilitate technology inflow to small businesses at lower cost, thus incentivising young entrepreneurs running business ventures or wanting to start new ones.
The Centre has also mooted a Self Employment and Talent Utilisation (SETU) mechanism, a techno-financial incubation and facilitation programme to support all aspects of start up business and other self employment activities particularly in the technology driven areas. An allocation of Rs 1,000 crore has been made for this.
Jaitley also proposed to establish Atal Innovation Mission (AIM) in NITI that will be an innovation promotion platform and draw upon national and international experiences to foster a culture of innovation, R&D and scientific research in India.
“Atal Innovation Mission and SETU underline our commitment to enable innovation, entrepreneurship and start-ups to grow and shine in India,” Prime Minister Narendra Modi said.
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