FICCI delegation led by Past President of the industry body Rajan Bharti Mittal met Ajay Bhushan Pandey, Secretary (Revenue), Ministry of Finance in the pre-budget discussion meeting held at North Block recently.
The key recommendation was that the focus of the Government should be to spur domestic investment and in order to retain India’s competitiveness globally, corporate tax rate cut should be considered.
It was stressed that with phasing out of exemptions and deductions available under the Income Tax Act, 1961 (‘the Act’) and to avoid complexities arising under Ind-AS, there is a need to review the concept of Minimum Alternate Tax (MAT).
A recommendation has been made to abolish MAT and extend a simpler Alternate Minimum Tax as is currently applicable to non-corporates to corporates, but at a reduced rate of 10% considering the reduction in corporate tax rate to 25% in line with global trend.
The need to restore weighted deduction under section 35(2AB) of the Act for expenditure incurred on scientific research being critical for Indian businesses was clearly stressed upon.