Cut income tax rates, Industry asks FM Sitharaman

Cutting the income tax rate by half for those who earn less than Rs 20 lakh in a year will put more disposable incomes in the hands of people and help arrest the economic slowdown faster, was the suggestion by industry honchos, who were called by Finance Minister Nirmala give their inputs ahead of the making of the Union Budget.

Most of them also discussed measures to reduce equated monthly installments for home and auto loan seekers to give a leg up to muted demand in the two sectors. This could only happen if the banks reduce interest rates on loans.

In her sixth pre-Budget meeting, Sitharaman had a long discussion with industrialists including Sunil Bharti Mittal of Bharti Enterprises, BVN Rao of GMR Group, Sanjiv Goenka of RP-Sanjiv Goenka Group and Acharya Balkrishan, Chairman of Patanjali Ayurved among others.

The discussions were held close on the heels of the industry getting a 15% cut in corporation tax, which has neither lifted new investments in the country nor had much impact on consumption.

The suggestions also included ways to reduce time for FDI approval, structural changes in laws for effective and stable business environment, time-bound decisions for augmenting ease of doing business both at central and state levels, new investment of capital for building infrastructure; CAPEX for infrastructure to boost economy; preventing predatory pricing and dumping in India; facilitating research and development in India to boost Make in India and ensuring liquidity for NBFCs with focus on rural economy and ways to increase consumption in economy.

Mittal said he discussed only one thing – make doing business easy. “The idea is to create more freedom for the industry to perform.”