Search the Internet          Tips  Sites: Finance, Investment

Govt unlikely to remove tax sops in one go

The government does not appear to be in favour of adopting the Kelkar task force suggestion of lifting all direct tax exemptions in one go.

"Lifting all exemptions (in one go) may not be possible as the government has given assurances to many sectors. The issue of foreign direct investment flows are also involved," a top finance ministry official said today.

The official added that "if exemptions are lifted altogether, there would be no room for such sops in future budgets."

The task force has suggested lifting most exemptions in Income Tax as well as corporate taxes.

Kelkar, who submitted the panel's consultation paper to the minister last week, said the lifting of all exemptions would be accompanied by reduction in corporate tax rates to 30 per cent, and added that the resultant effect would be "revenue-neutral" to the government.

ALSO READ:
Monetary & Credit Policy 2002-2003
More Money Headlines

Tell us what you think of this report