Budget Wishlist: Reduce Corporate Tax Rate to 25%

By M P Vijay Kumar, CFO, Sify Technologies

1.   The government should opt for vertical-specific investments to increase employment in industry verticals like heath, education, and manufacturing. Ideally, the Government should focus only on health and primary education. In order to drive adoption, the coverage should be mandatory on the lines of the Prime Minister’s insurance schemes.

2.   The time is ripe to strengthen healthcare at the grassroots and coverage broadened to support all classes of the society like lower income groups and retirees and non-income earning groups.

3.   Higher education and specialist medical education and care should ideally not be the Government’s purview but only overseen from a compliance standpoint.

4.    Corporate tax rate should be made 25% and all exemptions must be rationalized/removed so that there is uniformity to the taxation base and predictability in revenue collections. In order to jumpstart adoption, this could include the withdrawal of ICDS (Income computation and disclosure standards).

5.    It should be mandatory for individuals to file tax return but it can also be incentivized by increasing the minimum tax slab to Rs.10 lacs. Ideally, tax incentives should be exclusive of standard insurance policies to encouraging savings.

6.    The government will find a lot of takers if it sticks to a timeframe for refund of all tax dues and takes a BG for half of the amount. This will create more investment and employment. This will be a huge relief for SMEs and is a big step in ease of doing business.