Builders call for tax parity with manufacturing sector
Infrastructure developers such as Gammon India, Simplex Infrastructure and Hindustan Construction have demanded that construction firms in the organised sector be allowed to pay advance tax like manufacturing companies.
By Priyanka Talwar, TNN |
NEW DELHI: The construction industry wants to be treated on par with manufacturing sector. Infrastructure developers such as Gammon India, Simplex Infrastructure and Hindustan Construction have demanded that construction firms in the organised sector be allowed to pay advance tax like manufacturing companies.
“The request of the construction industry is largely revenue neutral as it relates to procedural relief rather than tax breaks,” Construction Federation of India (CFI) director general SC Mehta said.
The industry said the current 2% tax deducted at source in a business where profit margins are 4-5% is severe and they should be allowed to pay advance tax. In other words, companies should be able to pay I-T in advance on the income of current fiscal.
Construction companies also raised the issue of imports. It suggested that all imports for infrastructure projects, including spares and parts, must be duty-free. The industry has proposed that imports of steel and cement may be allowed at 5% duty, while excise duties on domestically-produced cement and steel should be in the lower excise band of 8%.
While import of hi-tech equipment for infrastructure projects is permitted, the industry wants the withdrawal of the 5-year restriction on sale of imported equipment.
Allowing its resale will release resources, save foreign exchange and reduce project costs, the industry feels. It said member companies of JVs may be allowed to import duty exempt goods in their own names instead of JV names.
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