Budget: FIEO for employment-linked tax benefits, cut in corporate tax

Exporters’ body FIEO on Tuesday urged the government to announce various measures such as employment-linked income tax benefits and set up a fund for marketing purposes to boost the country’s outbound shipments in the upcoming Budget. Federation of Indian Export Organisations (FIEO) also demanded tax deduction on R&D investments, cut in corporate tax, reducing customs duty on capital goods which are not produced in the country, and higher budgetary allocations for the Department of Commerce.

“We would urge the government to provide income tax relief to units which provide additional employment in export sector,” it said in a statement. Incentives should also be provided based on twin criteria of incremental growth in exports and workers, it added.

For small exporters, it said marketing and showcasing of their products in global markets require substantial expenditure and the current support extended through various schemes is grossly inadequate.

“We require an export development fund with a corpus of 0.5 per cent of export value, so that MSMEs aggressively participates in international exhibitions and trade shows,” it said.

Further the organisation said the budget should encourage domestic manufacturing with a focus on imports substitution.

“On customs front, the instances of inverted duty structure needs to be looked into,” it said.

It added that the corporate tax reduction may be extended to all entities.

The country’s exports grew by 9 per cent to USD 331 billion in 2018-19.