ASSOCHAM has suggested the government in the customary pre budget consultations with Finance Minister Arun Jaitley to reduce the Corporate Tax to 25 percent in order to encourage large investment by domestic and foreign corporates in India.
This step will be in line with countries like the US, which is also in the process of making major tax cuts, and Singapore and Middle East, which already have lower tax rates.
The apex industrial body also urged the government to consider increasing import duty on metals like steel, aluminium, copper and zinc as high competition in the sector has adversely affected domestic metal sector.
"This sector's competitiveness is adversely affected due to high cost of electricity and other inputs and imports at zero or concessional duty rate from countries like Korea and Japan under trade agreements," ASSOCHAM said.
It also called for an urgent need to critically review the implementation process of economic reforms introduced during last one year like GST, demonetisation and Insolvency law, and take corrective steps in consultation with the industry.
ASSOCHAM also asked the government to take corrective steps for particularly the SME sector and also the large industry segments like textiles, which have been negatively affected by complex GST compliance procedure.
"The tax refund to exporters has been considerably delayed affecting their working capital. This has reduced the export growth of sectors like leather and textile, which has huge employment potential," it added.
It urged the government to fix accountability of tax administrators as there is fear of tax terrorism prevalent in trade and industry and also to consider revising the tax exemption limits for senior citizens and salaried employees.
"Tax exemption limits for senior citizens and salaried employees should be increased who are adversely affected by inflationary impact in food items and items of daily use during recent past," the industry body also stated.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)