FM promises to rationalise taxes to tackle black money issue
Says the world needs "additional shoulders" other than China to push growth and this presents an opportunity for India
Finance Minister Arun Jaitley has promised to rationalise tax rates for individuals and bring down corporate tax to 25 per cent flat in four years beginning next fiscal along with removal of exemptions except those that encourage individual savings.
Addressing students and faculty at the Columbia University on Monday night, he said along with a rational rate of taxation, more banking transactions and making PAN card compulsory for payments over a threshold limit will go a long way in tackling the problem of domestic black money.
He outlined the roadmap of the BJP-led Government for the coming months, saying the Goods and Services Tax (GST) will be a "top priority" and hoped to take the Bankruptcy Code to parliament in the winter session.
"The nature of the economy is itself changing so more and more banking transactions, payment getaways are a reality, all this is going to incentivize and a lot of economy is going to go through the banking transaction as a result of this."
Jaitley said that one of the main problems is of credibility related to taxation issues.
"As far as the taxation issues are concerned, a lot needed to be done at our end and therefore in terms of direct taxes, we'd lost credibility with the world," he said. Aggressive taxation did the country no good and does not bring taxes but it "brought us a bad name", he said.
"For anyone in the government, it would be a very serious challenge where assessment orders have been passed can only be set aside by a judicial process and not by an executive decision," he said, adding that to resolve each one of these issues has been one of his toughest challenges.
He reiterated that India has now reached a situation where it is no longer satisfied with a 6 to 8 per cent growth rate and most Indians believe that "my normal is eight plus (growth rate), probably closer to nine per cent" and higher.
"One of the great shoulders the world was relying on (was) China. The world now needs some other additional shoulders to give a push to the growth rates.
"I see over the next few years with a more friendly environment in the world as far as the economic scenario is concerned, probably our growth rates will move up, our ability to grow will move up and our ability to fight poverty at least will also improve," he said.
INDIA "BRIGHT SPOT"
Prime Minister Narendra Modi said it makes strong business sense to be in the country, assuring investors of simple and predictable tax regime as well as IPR protection. Highlighting "decisive steps" taken by his government, Modi said it was working on a new bankruptcy code, forming the Company Law Tribunal and is keen to "see that genuine investors and honest tax payers get quick and fair decisions on tax matters".
On Intellectual Property Rights, Modi said India is committed to protecting IPR of all innovators as well as entrepreneurs, and a comprehensive National IPR policy is being finalised.
Stressing that the necessary conditions to propel the Indian economy to a high growth trajectory do exist today, he said it makes strong business sense to be in India. "It makes even better business sense to Make in India."
P ositioning India as a ‘bright spot’ for investment in the current global slowdown, Modi says it makes even better business sense to Make in India"