NEW DELHI: Ahead of the budget, economists have suggested lower corporate and personal taxes, fewer tax exemptions, a uniform import duty to address the inverted duty structure to encourage manufacturing and more steps to create a bigger formal economy by building on demonetisation.
The suggestions followed a meeting organised by the Niti Aayog on the theme 'Economic Policy – The Road Ahead' attended by Prime Minister Narendra Modi and Finance Minister Arun Jaitley.
In his intervention, Modi called for innovative approaches in areas such as skill development and tourism, a statement released by the government said. He also explained the thought behind advancing the budget that would be presented almost a month earlier than usual, saying under the current system the authorisation of expenditure comes with the onset of the monsoon.
This results in government programmes being relatively inactive in the productive pre-monsoon months, he told economists. The budget is likely to be presented on February 1 this year rather than end February.
The railway budget has been absorbed into the main budget. The Central Board of Direct Taxes (CBDT) and the Central Board of Excise and Customs (CBEC) should not work in silos and share data, Niti Aayog Vice Chairman Arvind Panagariya cited Modi as saying while briefing reporters about the meeting.
If someone sees that his or her tax revenue is used to build, say a hospital, nobody will hesitate to pay tax, but when expenditure is not properly done, then people want to evade, Panagariya said, mentioning the PM’s intervention.
"Experts suggested reducing corporate and personal income tax, and removing exemptions to simplify the tax regime," Panagariya said. Before the meeting with Modi and Jaitley, three separate groups of economists deliberated on agriculture, skills, jobs, education and the budget with a mandate to make specific suggestions to the prime minister.
The economists and experts who attended the meeting included Pravin Krishna, Sukhpal Singh, Vijay Paul Sharma, Neelkanth Mishra, Surjit Bhalla, Pulak Ghosh, Govinda Rao, Madhav Chavan, NK Singh, Vivek Dehejia, Pramath Sinha, Sumit Bose and TN Ninan.
Source: economictimes.indiatimes.com