Madurai: Reduction in income tax (IT) and GST rates are among the key demands put forward by the Tamil Nadu Chamber of Commerce and Industry (TNCCI) in their pre-budget memorandum to the finance ministry.

TNCCI president N Jegatheesan, senior president S Rethinavelu and secretary J Selvam submitted the memorandum to the ministry in New Delhi on Wednesday.

In a bid to stimulate the economy by increasing purchasing power of consumers, the chamber suggested changes in IT slabs and rates. Pointing out that IT exemption limit of Rs 2.5 lakh fixed six years back, they suggested increasing the same to Rs 5 lakh.

They also suggested 5% IT for income in the range of Rs Rs 5-10 lakh and 10% from Rs 10-25 lakh. Stating that maximum IT rate should be 25% for income of above Rs 25 lakh, they also sought a further deduction in corporate tax to 15% for all companies.

Regarding GST, they sought four rates at 5, 10, 15 and 20% in place of the existing slabs of 5, 12, 18 and 28%. They said that 20% should only be fixed for sin goods and super luxury cars, adding that the rest should be in the 5-15% categories. Maximum GST for services should only be 15%.

Environmental friendly bio-diesel industry, which uses used cooking oil as feedstock, should be encouraged by reduction of GST from 12% to 15%. Seeking exemption for paper bags, as it is widely used as a viable alternative to plastic covers, they also pressed for reduction of GST on lamp oil from 12% to 5%.

They also emphasised one rate of tax for all goods covered under the same chapter under HSN Code structure under GST to rule out confusion and ambiguity. They also sought withdrawal of state-level authorities for advance ruling to confirm rate of tax for commodities to clear confusion created by differing orders by different state authorities.

“The basic principle of GST that there should be no goods and services without input tax credit benefit is defeated by refusing to grant it for construction of immovable property and vehicles for business use,” they added.

Published On : 25-01-2020

Source : Times of India