A FICCI delegation led by President Pankaj Patel met Finance Secretary Hasmukh Adhia to suggest expeditious domestic tax reforms and measures for improving the ease of doing business scenario in the country and enhance competitiveness of Indian industry.
The major issue discussed in the meeting was steps to deal with the US tax rate cut which is set to significantly impact Indian industry if corrective measures are not taken. FICCI has recommended a similar approach, as in the US on reducing corporate tax rate besides other tax changes to ensure the competitiveness of Indian exports and industry.
The FICCI delegation recommended several tax proposals that will help in achieving a more business friendly tax ambience, such as review of provisions. The delegation also sought grant of tax reliefs/ concessions pursuant to proceedings under Insolvency and Bankruptcy Code (IBC). There was need to encourage applicants for submitting and implementing viable resolution plans for revival of stressed assets and ensure fulfilment of the objectives of IBC through certain modifications to the Income-tax law so that the implementation of resolution plans under the IBC does not lead to undue tax costs.
The FICCI delegation pointed out that the GST law seeks to bring transactions between different registrations of the same legal entity or between premises of same legal entity located in different states within the ambit of GST. This results in taxation of artificial transactions and not economic transactions since collective performance of services is also treated as taxable supplies between branches. The delegation has urged that the supply of service within the same legal entity from one vertical or division or office to another for use/consumption in the same legal entity should not be made liable to GST.