PHD Chamber of Commerce and Industry said the time has come to rationalise the direct taxes. (Image Credit: PTI)
PHD Chamber Wednesday pitched for cutting corporate tax to 25 per cent, and raising income tax exemption limit for individuals to Rs 3.5 lakh per annum in the forthcoming Budget. In a statement, PHD Chamber of Commerce and Industry President Rajeev Talwar said it looks forward to a "dynamic, inclusive and pragmatic budget" on February 1.
"At this juncture, the economy needs further bold measures to boost the investment environment and to trigger demand growth to the next level," Talwar added.
He said the time has come to rationalise the direct taxes, starting from reduction in Corporate Tax to a level of 25 per cent.
"This will provide a boost to economic growth and would result in widening of the Direct Tax net, enhance collections and promote compliance further," Talwar noted.
The government lowered the corporate tax rate to 25 per cent for businesses with a turnover of up to Rs 250 crore in the Budget presented last year.
Talwar suggested that income up to Rs 3.5 lakh should be considered for tax exemption for individuals, instead of Rs 2.5 lakh at present.
"The maximum personal income tax rate should be towards 25 per cent to increase the personal disposable income which will boost demand in the economy. The maximum marginal slab should also be raised to Rs 15 lakh instead of Rs 10 lakh," said Talwar.
He noted that consistent indirect tax revenue growth, along with a reduction in GST rates by the government, indicates that the tax base is widening and economic activity is rapidly expanding in the country.
Talwar, who is also the CEO of realty major DLF, said continuous reforms in the housing and construction sector would definitely create employment opportunities for millions of unskilled, semi-skilled and skilled workforce.
"Privatisation of railway and road transport on the lines on aviation industry is the answer for the future," he said.
Talwar also batted for continuous reforms in the agriculture sector to improve farm productivity and income levels.