It’s a mixed bag, feel corporate captains

The thrust given to rural and infrastructure sector will have a multiplied effect on the economy but the Budget has failed on the corporate taxation front, India Inc said on Monday.

Reacting to the Budget, Bajaj Auto’s chairman Rahul Bajaj said: “Overall, I would say (the Budget is) pretty good. It’s a farmer-friendly budget. Even though Jaitley’s move to levy tax on corporate on getting dividend above Rs 10 lakh is against the industry, in my view it is a welcome step. I would also get affected from this tax, but it’s good in the interest for the country.”

Bajaj added, “The industry was worried about legacy tax, which didn’t happen as if it would have happened; the gift tax could also have been included. So industry should feel happy that only dividend tax has come into effect, which nothing wrong as it’s part of tax across the globe.”

“It’s a budget which has paved the way for overall development. The relaxation of tax discount to new start-ups for 3 years is very result-oriented decision, which will help in the growth of entrepreneurships in the country,” said Kiran Karnik, former president of NASSCOM.

Commenting on the budget, FICCI president Harshvardhan Neotia said, “Corporate tax rate reduction was something that we were looking at ... a clearer roadmap on how it is going forward... Going forward, we expect some clarity on how the exemptions will be eased out.” “There was a lot of debate when Finance Minister Arun Jaitley talked about reducing it (corporate tax) to 25 per cent. I don't believe anything has been done on that but he has got a four-year window for it," CII president Sumit Mazumder said.

“He (Jaitley) has not reduced corporate tax at all this year except for very small firms,” CII president designate Naushad Forbes said.

CII’s director general Chandrajit Banerjee said, “The Finance Minister presented a well-rounded package of reforms and growth-oriented measures in the budget. The budget proposals addressed issues in nine critical areas ranging from agriculture and the rural sector to financial sector and banking.”

Assocham president Sunil Kanoria said rationalisation and simplification of tax rates would have benefitted the overall ease of doing business, especially keeping in mind that GST implementation seems to have been pushed ahead.