Honchos to attend FM's pre-Budget meet

NEW DELHI: The finance minister's pre-Budget meeting with the industry on Tuesday is likely to be attended by Ratan Tata, Mukesh Ambani, Anil Ambani, Sunil Bharti Mittal, Azim Premji, Venu Srinivasan, AM Naik, Venugopal Dhoot, Kiran Karnik, Malvinder Singh, Kiran Mazumdar Shaw, Confederation of Indian Industry president R Seshasayee, Ficci past-president YK Modi and Assocham president Anil Agarwal.

The members of India Inc will put forward their recommendations for the Union Budget 2007-08. For industry chamber CII, the priority areas would be education and skill development. The chamber has recommended that education spend be increased from current 4% of GDP to 6%, while a skill development bank be formed to finance higher education of students belonging to the underprivileged sections of the society.

CII has also suggested creating a Central R&D fund for the use of small and medium enterprises and to fund engineering and similar institutes for upgrading skill and knowledge, with corporate contributions to this fund attracting a 200% weighted tax deduction.

A concrete roadmap for the implementation of the Goods and Service Tax by 2010, bringing down indirect tax incidence from 28.5% to 15% in ten years and keeping the service tax rate unchanged are its other key recommendations.

Reducing corporate tax to 25%, from current effective tax of over 40% and widening the tax base to include services would be two important recommendations by Ficci at the meeting. The chamber will also ask the government to correct the inverted duty structure, modify FBT provisions to exclude genuine business expenses and abolish all cross subsidies in pricing of oil and electricity.

Assocham has recommended that while there be no reduction in average customs duty, in case of peak customs duty (100-150%), there should be a reduction of 15-20%. It has also asked for excise duty to be reduced by 4% and removal of 12.5% surcharge on corporate tax.