Industry captains rally against FBT

Another point put forward was tax on agriculture starting with rich farmers which would broad-base revenues for the government to meet their revenue obligations arising on account of several new programmes (Bharat Nirman, Employment Guarantee etc).

While Chidambaram did not commit to India Inc on what would be done on these two issues, he said that the forthcoming budget would focus on those areas of industry which would lead to job creation and value addition to the economy.

He identified five key sectors where the budget is expected to pay attention. These include textile, pharma, information technology, chemical and the metals sector. In terms of specific suggestions put forward by Indian Inc, represented by the likes of Anil Ambani, Sunil Mittal, Anil Agrawal, YC Deveshwar, Swati Piramal, Venugopal Dhoot etc, the pharma industry asked the FM to extend the provision of seed funding of Rs 150 crore given for research and development to five years.

In a comparison to how the Chinese government encourages R&D, the pharma industry expressed that while the quantum of funds could remain at Rs 150 crore, they wanted this facility to last for a longer time rather being limited for only one year. They also wanted the government to extend weighted deduction benefit for a period of 10 years and increase the weight from 150 to 200 per cent.

In yet another specific proposal, the chambers expressed that the government should restore the depreciation rate to 25 per cent, which was reduced to 15 per cent earlier.

What they discussed

• Scrap FBT completely or streamline norms

• Assocham even moots hike in corp tax

• Restore depreciation rate to 25%

• FM to focus on textiles, pharma, IT, chemicals, metalsl