Moving ahead with direct tax reforms, finance minister Arun Jaitley on Wednesday said the government would, in the next few days, issue a list of exemptions that would be pruned to help lower the corporate tax rate to 25 per cent over the next four years.
“Over the next few days we will come out with a list of exemptions, which we intend to phase out in the first place. Over the next four years corporate tax will come down by 5 per cent and lot of exemptions will get phased out. Slowly we will bring taxation levels to global standards and make tax assessment and returns simpler by just eliminating a lot of exemptions,” he said.
The minister had in the Union Budget 2015-16 announced a roadmap to reduce the rate of corporate tax from 30 per cent to 25 per cent over the next four years.
“It is extremely legitimate for any country to say my resources must come within the system, they must not remain parked outside the system. We were reasonable enough to put people on notice and gave them a fair opportunity to bring them in,” he said at The Economist India Summit 2015, adding that various delegations have approached him to go easy on domestic black money laws as it aids in economic activities.
He also said that the government does not plan to resort to retrospective taxation and was trying to resolve all major taxation issues outside the judicial system barring one (Vodafone tax case) which would be resolved through the judicial process.
Addressing the session where about half the invitees said the government could do more on reforms, the finance minister said there is a change in the popular mood. “If a legitimate number of people feel that growth can be faster, we must recognise that. The pressure is on the Opposition not to obstruct growth,” he stressed.
Jaitley also clarified the government has not gone back on amendments to the Land Acquisition Act 2013 by letting the ordinance lapse, but has instead decided to move forward on an “alternative route” where in states can decide to change their respective laws. While India may be growing at 7 per cent to 7.5 per cent and be tagged as the fastest growing economy in the world, he said that there is an expectation of higher growth. “The expectations we built were logical…in adverse global situations, India must follow the reform path,” he stressed.
‘Weak PSBs to merge with strong peers if worries persist’
New Delhi: Finance minister Arun Jaitley on Wednesday said the government may consider merger of weaker public sector banks with stronger ones, if efforts to strengthen are not successful. “A bank which is fragile after all these efforts…we are open to looking at consolidation with a stronger bank,” he said. ENS