As part of routine industry consultations ahead of the Budget 2025–26, corporate lobbies FICCI and CII have submitted a list of measures to reduce litigation, ease compliance and rationalise taxes to the revenue secretary.
The Federation of Indian Chambers of Commerce & Industry has made several requests, both on the direct and indirect tax fronts, while the Confederation of Indian Industry has made wide-ranging wishes on increasing capex, the Mahatma Gandhi National Rural Employment Guarantee scheme and sectoral spends on education and healthcare.
CII
As part of a comprehensive economic policy framework, the CII recommended 'GST-like' councils or empowered group of secretaries for building state-level consensus for reforms on land, labour, water, power, agriculture and fiscal sustainability.
On infrastructure, the CII requested a 25% increase in capital expenditure over the 2024 budget estimates, proposing a total of Rs 14 lakh crore, with a special focus on rural areas, agriculture, and social sectors. Additionally, it suggested a 10% increase in capex support for states, raising it to Rs 1.65 lakh crore.
To increase demand among lower-income groups, the CII recommended increasing the minimum wage under the Mahatma Gandhi National Rural Employment Guarantee Act from the minimum wage rate under the MGNREGS from Rs 267/day to Rs 375 and enhancing the PM Kisan assistance from Rs 6,000 a year to Rs 8,000, and also to introduce 'consumption vouchers' for lower-income households.
The CII also requested for the launch of the second phase of the National Monetization Pipeline, restructuring the goods and services tax to a three-rate system that includes petroleum products, electricity, and real estate and expanding the Production Linked Incentive schemes to cover additional sectors like defence and aerospace, apart from lowering custom duties.
On education and healthcare, the CII recommended increasing healthcare spending to 3% of the gross domestic product and education spending to about 6% of the GDP.
FICCI: Direct Tax
The body has made four demands to ease compliance with direct taxes:
Simplify compliance with respect to TDS.
Roll back simultaneous trigger of TDS and TCS provisions (Section 194Q and Section 206C (1H).
Dispense requirement to issue TDS certificate.
Relax applicability of Section 206AB on dividend payments to all non-residents.
For reducing direct tax-based litigation, the body has asked for the introduction of a new independent dispute resolution forum, for effective and time bound dispute resolution.
It has also asked to:
Provide relaxation from mandatory stay of demand.
Provide for timely disposal of matters pursuant to Taxpayer Charter and provisions of the Act.
Issue notifications by notifying the effect of Most Favoured Nation clause from date of entry into force of Double Taxation Avoidance Agreements entered by India with third countries.
It has also recommended the following rate rationalisation measures within direct tax:
Rationalise provisions of section 50CA and 56(2)(x).
Reduce holding period for “undertaking” for computation of capital gains in case of slump sale.
Taxation of share buybacks should be treated at par with taxation of capital reduction.
Delisting of listed subsidiaries of listed parent in compliance with guidelines issued by SEBI to be made tax neutral for shareholders and companies.
Exempt reimbursement of day care expenses from perquisite taxation.
FICCI: Indirect Tax
On the indirect tax front, it has made four suggestions for improving ease of compliance:
Allow Single Certificate of Origin for a vessel, against multiple Bill of Entries.
Allow filing of a single appeal before Commissioner Appeals against multiple bill of entries' assessment.
Allow benefit of Authorized Economic Operator certification to newly incorporated companies of AEO accredited groups.
Improve BIS certification challenges for importers.
It has also requested a new Amnesty Scheme under Customs for resolution of disputes.
Among rationalisation measures, it has demanded clarity in the GST Law to avail IGST Credit paid through TR-6 Challan, against imports and a review of the process of Special Valuation Procedure.
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