FM may prune customs duty in budget to 10%
He also slashed the peak customs rate from 50% to 40%, a reduction of 10 percentage points. His successors sustained the momentum to the point that he is now expected to prune it to 10% from 12.5%.
By TNN |
NEW DELHI: In 1997, FM P Chidambaram took bold step, arguably the one that most contributed to its being dubbed a dream budget, of reducing corporate and personal income tax rates. In fact, the 30%, 20% and 10% rates that he ushered in 10 years ago remain unchanged to this day, though slabs and exemption limits have been tweaked and cesses or surcharge imposed in almost every budget since then.
He also slashed the peak customs rate from 50% to 40%, a reduction of 10 percentage points. His successors sustained the momentum to the point that he is now expected to prune it to 10% from 12.5%. So, is the picture the FM sees today a dream come true or an opportunity to dream again? Some would say a bit of both. But if FM dreams again, it might be nice if his visions were to turn to things that have not changed in these last 10 years.
These include, as already mentioned, tax rates. They also include promises to bring in a new law on direct taxes and a new Companies Act, pieces of legislation that are now vying with Women’s Reservation Bill for a place in the record books for the sheer number of years for which they have been pending.
He might also wish to reiterate his appeal to state governments to abolish the controls on marketing agricultural produce, since most states are yet to get rid of the Agricultural Produce Market Committees (APMC) Act.
You might say that much of this wish-list has little to do with the budget and some of it is not even strictly within the purview of the Central government. That’s true, but then dreams can’t be confined to balance sheets. Would Thiruvalluvar agree?
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