JOIN USIn pre-Budget consultations, senior Finance Ministry officials conveyed the Government’s disappointment to industry for not passing to consumers the benefit of excise and service tax cuts announced in December and January, a chamber official said.
Revenue Secretary P V Bhide had convened separate meetings with industry bodies — CII, FICCI and Assocham — earlier this month. While, the three chambers presented wish lists to the Finance Ministry, they were told that new Finance Minister would not have much headroom for any more fiscal incentives which the industry wants for boosting the economic activity.
Deficit too high
The fiscal deficit for 2009-10 is pegged at Rs 3,32,835 crore, 5.5 per cent of the GDP. As industrial production fell, the revenue was impacted in the last fiscal. The direct tax kitty fell to Rs 3.38 lakh crore in 2008-09 compared to the truncated target of Rs 3.45 lakh crore.
The government had slashed across-the-board by four percentage points excise duty and two percentage points service tax in two stimulus packages to limit the impact of global downturn on the economy. The chambers want removal of the Fringe Benefit Tax and surcharge on corporate tax.
They also want tax incentives for investment and raising of personal income tax exemption limit. Industry also wants excise duty at eight per cent and service tax at 10 per cent are continued at least till the next fiscal.
The government had presented an interim Budget for the current fiscal on February 16, even though estimates were given for the full year.