Union Budget for 2012-13 as under:
1. Direct Taxes
(a) Highest rate of Income Tax should not be more than 25% for individuals as well as corporate.
(b) Exemption on Income tax for individual assesses should be Rs.2.40 lac looking to the inflation. This limit for senior citizens and very senior citizens should be 3.00 lac and 6.00 lac respectively.
(c) Surcharge and education cess on Income Tax both for individuals & corporate should be done away with.
(d) Exemption u/s 80© should be raised from 1 lac to 2 lac.
(e) Exemption u/s 80(D) should have no limit.
(f) Regarding TDS payment, time limit for deposit of the tax deducted should be 15 days instead of 7 days. 7 days time is too short after the close of month, since data collection from various places of business including within the town or otherwise has to be compiled.
(g) MAT on corporate was implemented @ 5% and gradually increased to 18%. It is against the principal of natural justice. On one side the government grants exemption of tax on certain incomes like u/s 80-IC and on the other side it collects 60% of the tax amount in the name of MAT. The government takes plea that payment of MAT is adjustable in coming years, but it is limited to six years only. In consideration of section 80-IC, implementation of MAT is practically indirect withdrawal of 60% of the incentive. MAT must be withdrawn in such cases with retrospective effect.
2. E-payment:
Payment of tax through this mode is a big problem for tax payers/TDS deductors. The employers have to depend upon their employees, since this mode can be used only by those who have expert knowledge of computer operation. There are all possibilities of frauds may be from the hands of employees or data hackers or bank staff etc.
Optional payment through cheque deposit in authorized banks should be allowed.
3. Audit
(a) Statutory audit u/s 44AB is necessary on organizations with their turn over above 60 lac. Looking to the inflation in number of years this limit should be raised to 100 lac.
(b) For professionals their limit should be raised from 15 lac to at least 25 lac.
4. Indirect Taxes:
(a) Excise Duty:
(i) Excise duty exemption of small scale manufacturers be raised from 1.5 crore to 3.00 crore. Small scale industry from 4 cr to 6 cr
(ii) In certain cases, where rate of duty is 5% on end product and 10% on its raw materials, refund of cenvat credit is natural. Refund in such cases must be given to the industry and that too in a reasonable time limit.
(b) Service Tax:
(i) Limit of Service tax implementation should be raised from 10 lac to 20 lac looking in to the inflation since start of service tax.
(ii) Service tax particularly on rented commercial properties is unjustified and should be done away with, since letting out of property is not at all a service. In most of the cases properties are made by a person after long struggle in life and when he has reached senior age and at that stage he is put to trouble of completing legal formalities and filing service tax returns as an individual.
(ii) Service tax on transportation of goods, when shifted to service receiver is a dictatorial step by the government since all indirect taxes are collected by seller/service provider and deposited in government accounts. It should also have the same treatment, otherwise abolished.
(c) Central Sales Tax (CST). Till the time GST is implemented necessary steps be taken in Central Sales Tax Act. In the year 2005 when VAT was to be introduced it had been assured by the then
Finance Minister that the government would reduce rate of CST from
4% to 0% in phased manner at 1% each year. Till date it has been brought down to 2% only. Therefore, the announcement already made be honored. In the procedural matters some changes be made i.e. “C” Form, which is a source of corruption and unnecessary hardship to industry and trade, be abolished. Till the time it is not abolished, it should be available on-line direct to the dealer on simple submission of his requirement. Unnecessary way bills/road permits/entry forms be abolished required in states on interstate sale/purchase. No barriers should be on the highways to avoid huge jam of trucks and wastage of time and man power. All checks be made on-line through the TIN numbers, which is there throughout the country either at sales tax offices or mobile squads.
(d) Value Added Tax. Rate of VAT on all India basis be made uniform to avoid unauthorized transfer of goods from one state to another, which further moves to unaccounted transactions resulting evasion of income tax at many levels.
(e) Goods and Services Tax. Goods and Services Tax be started as early as possible. It is very important to note that it should be free from complications as in the local VAT prevalent. It is also very important to take into consideration that units availing benefit of Excise and Income taxholiday in Himachal Pradesh and Uttra Khand etc get that part of the their benefit, as those units have invested lot of money in establishing the units and making infrastructure in those areas.
(Kuldip Singh Bagga)
Chairman Taxation Committee
Apex Chamber of Co
1. Direct Taxes
(a) Highest rate of Income Tax should not be more than 25% for individuals as well as corporate.
(b) Exemption on Income tax for individual assesses should be Rs.2.40 lac looking to the inflation. This limit for senior citizens and very senior citizens should be 3.00 lac and 6.00 lac respectively.
(c) Surcharge and education cess on Income Tax both for individuals & corporate should be done away with.
(d) Exemption u/s 80© should be raised from 1 lac to 2 lac.
(e) Exemption u/s 80(D) should have no limit.
(f) Regarding TDS payment, time limit for deposit of the tax deducted should be 15 days instead of 7 days. 7 days time is too short after the close of month, since data collection from various places of business including within the town or otherwise has to be compiled.
(g) MAT on corporate was implemented @ 5% and gradually increased to 18%. It is against the principal of natural justice. On one side the government grants exemption of tax on certain incomes like u/s 80-IC and on the other side it collects 60% of the tax amount in the name of MAT. The government takes plea that payment of MAT is adjustable in coming years, but it is limited to six years only. In consideration of section 80-IC, implementation of MAT is practically indirect withdrawal of 60% of the incentive. MAT must be withdrawn in such cases with retrospective effect.
2. E-payment:
Payment of tax through this mode is a big problem for tax payers/TDS deductors. The employers have to depend upon their employees, since this mode can be used only by those who have expert knowledge of computer operation. There are all possibilities of frauds may be from the hands of employees or data hackers or bank staff etc.
Optional payment through cheque deposit in authorized banks should be allowed.
3. Audit
(a) Statutory audit u/s 44AB is necessary on organizations with their turn over above 60 lac. Looking to the inflation in number of years this limit should be raised to 100 lac.
(b) For professionals their limit should be raised from 15 lac to at least 25 lac.
4. Indirect Taxes:
(a) Excise Duty:
(i) Excise duty exemption of small scale manufacturers be raised from 1.5 crore to 3.00 crore. Small scale industry from 4 cr to 6 cr
(ii) In certain cases, where rate of duty is 5% on end product and 10% on its raw materials, refund of cenvat credit is natural. Refund in such cases must be given to the industry and that too in a reasonable time limit.
(b) Service Tax:
(i) Limit of Service tax implementation should be raised from 10 lac to 20 lac looking in to the inflation since start of service tax.
(ii) Service tax particularly on rented commercial properties is unjustified and should be done away with, since letting out of property is not at all a service. In most of the cases properties are made by a person after long struggle in life and when he has reached senior age and at that stage he is put to trouble of completing legal formalities and filing service tax returns as an individual.
(ii) Service tax on transportation of goods, when shifted to service receiver is a dictatorial step by the government since all indirect taxes are collected by seller/service provider and deposited in government accounts. It should also have the same treatment, otherwise abolished.
(c) Central Sales Tax (CST). Till the time GST is implemented necessary steps be taken in Central Sales Tax Act. In the year 2005 when VAT was to be introduced it had been assured by the then
Finance Minister that the government would reduce rate of CST from
4% to 0% in phased manner at 1% each year. Till date it has been brought down to 2% only. Therefore, the announcement already made be honored. In the procedural matters some changes be made i.e. “C” Form, which is a source of corruption and unnecessary hardship to industry and trade, be abolished. Till the time it is not abolished, it should be available on-line direct to the dealer on simple submission of his requirement. Unnecessary way bills/road permits/entry forms be abolished required in states on interstate sale/purchase. No barriers should be on the highways to avoid huge jam of trucks and wastage of time and man power. All checks be made on-line through the TIN numbers, which is there throughout the country either at sales tax offices or mobile squads.
(d) Value Added Tax. Rate of VAT on all India basis be made uniform to avoid unauthorized transfer of goods from one state to another, which further moves to unaccounted transactions resulting evasion of income tax at many levels.
(e) Goods and Services Tax. Goods and Services Tax be started as early as possible. It is very important to note that it should be free from complications as in the local VAT prevalent. It is also very important to take into consideration that units availing benefit of Excise and Income taxholiday in Himachal Pradesh and Uttra Khand etc get that part of the their benefit, as those units have invested lot of money in establishing the units and making infrastructure in those areas.
(Kuldip Singh Bagga)
Chairman Taxation Committee
Apex Chamber of Co
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