Budget Countdown: What's in store... 3 days to go

[K.Karthik Raja]

Budget Countdown: What's in store... 3 days to go
Tuesday, Feb 26

Finance Minister P. Chidambaram will present the Union Budget for
2008-09 (Apr-Mar) on Feb 29. A daily update on the country's
expectations of the Budget, cutting across industry sectors and the
financial markets...
.
BULLION SECTOR
==============
AJAY MITRA, MANAGING DIRECTOR-INDIA, WORLD GOLD COUNCIL
"We expect the government to extend import licenses to many other
trading houses which would ease accessibility for jewellers from semi-
urban or interior areas. These traders have to depend on the 18-19 odd
banks and a few 5-star trading houses from big cities for their
supply, which increases their lead time and working capital
requirements."
.
SANJAY KOTHARI, CHAIRMAN, GEMS AND JEWELLERY EXPORT PROMOTION COUNCIL
"Apart from nominated agencies, status holders like star and
export
trading houses, if not all exporters, should be allowed to import
gold.
However, we feel small exporters should be allowed to import gold as
banks don't find it feasible to cater to the small quantities required
by them. We also expect exporters to be exempted from paying the 1%
value added tax as getting refunds is extremely cumbersome."
.
SURESH HUNDIA, CHAIRMAN, HUNDIA EXPORTS
"In addition to extending gold import licenses to all exporters,
re-export of gold should be allowed by importers apart from the
nominated agencies."
.
ASHOK MITTAL, COUNTRY HEAD, KARVY COMTRADE
"Value Added Tax on gold should be reduced to 0.1% from the
existing 1%, which is pretty high. Also, a uniform rate should be
applied across the country as states not covered under VAT have
different tax rates, which leads to a shift in business."
.
DEALER AT A FOREIGN BANK
"There's really very little we expect from the Budget. Currently,
customs duty and value added tax on gold are at very low levels and I
do not think the government will make any changes there, as, apart
from the risk of encouraging smuggling, that would only add to its
administrative expenses without really contributing to the kitty in
any significant measure. Tax collections have been buoyant and the
finance ministry is laughing all the way to the bank, so current duty
on gold of less than 1% won't be touched."
.
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S E C T O R S C O V E R E D E A R L I E R:
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REAL ESTATE
===========
PRADEEP JAIN, CHAIRMAN, PARSVNATH DEVELOPERS LTD.
* Feasible tax regimes that are in line with the growth of the sector.
* Industry status for preferential financing by banks and other
financial
institutions.
* Rationalisation of stamp duty--should be reduced to a range of 2-5%.
.
PRASHANT CHATURVEDI, CHIEF FINANCIAL OFFICER, DEWAN HOUSING FINANCE
CORP.
* Raise home loan interest rate deduction in income tax to 250,000
rupees from 150,000 rupees to boost housing demand, credit growth.
* Make 30% of the profit before tax from housing finance business non-
taxable, compared with 20% now.
* Incentive to enhance low-ticket loans.
.
SHRAVAN GUPTA, EXECUTIVE VICE-CHAIRMAN & MD, EMAAR MGF LAND LTD.
* Industry status along with a clear tax roadmap for introducing
mature
investment instruments like real estate mutual funds and real estate
investment trusts.
.
Other steps sought by the real estate sector:
* Service tax on rental income from commercial property should be
abolished.
* Taxation of income of REIT on the lines of mutual funds.
* To extend the special economic zone concept to housing sector with
special residential zones.
* Restoration of Section 80 IB(10) for areas below 1,500 sq ft to
generate interest of developers to provide lower income group housing.
.
.
TELECOM
=======
UMANG DAS, MANAGING DIRECTOR, SPICE COMMUNICATIONS LTD.
* The high cost structure for mobile operators be reviewed--spectrum
charges, licence fees, interconnect charges, customs duty.
* Uniformity in taxes and incentives for infrastructure sharing.
.
S.D. SAXENA, DIRECTOR, FINANCE, BHARAT SANCHAR NIGAM LTD.
* Service tax be lowered, reforms in its implementation, collection.
.
T.V. RAMACHANDRAN, DIRECTOR GENERAL, CELLULAR OPERATORS ASSOCIATION OF
INDIA
* Operators be exempt from paying service tax on interconnect usage
charges.
* TDS on these charges should also be abolished.
.
S.C. KHANNA, SECRETARY GENERAL, ASSOCIATION OF UNIFIED TELECOM SERVICE
PROVIDERS OF INDIA
* Licence fee revenue share be limited to 6% of adjusted gross
revenue, inclusive of the 3% Universal Services Obligation levy.
* Reduce spectrum usage charges to 0.5% of AGR from 2-6% now.
.
Other steps sought by the telecom sector:
* CENVAT credit for fuel used in tower maintenance.
* Lower duty on wireless data cards.
* Bring items required for telecom projects under nil basic customs
duty.
* Excise duty on locally made equipment be pegged at lowest level of
8%.
.
SHIPPING
========
S.S. KULKARNI, SECRETARY GENERAL, INDIAN NATIONAL SHIPOWNERS
ASSOCIATION
* Rationalise taxation regime for shipping industry to bring it on par
with international practices.
* Service tax, tax on interest income, MAT on ship sale profit and
seafarers' tax--need to be addressed on priority basis.
.
S. HAJARA, CHAIRMAN & MANAGING DIRECTOR, SHIPPING CORP. OF INDIA
* Level playing field with international shipping companies.
.
ANIL DEVLI, EXECUTIVE DIRECTOR, SHREYAS SHIPPING AND LOGISTICS LTD
* Tax everyone or exempt seafarers working on Indian ships.
.
Other steps sought by the shipping sector:
* Profit on sale of vessels be treated as core income
* Service tax on input services be nil
.
PHARMACEUTICALS
===============
TAPAN RAY, DIRECTOR-GENERAL, ORGANISATION OF PHARMACEUTICAL PRODUCERS
OF INDIA
* Boost investment in R&D
* Rationalisation of excise and customs duty, fringe benefit tax
.
B.N.SINGH, PRESIDENT, INDIAN DRUG MANUFACTURERS ASSOCIATION
* Central excise on allopathic, ayurvedic drugs be cut to 8% from 16%.
* Alternatively, the abatement of 42.5% from MRP be increased to 55%.
.
SUDHIR SINGHI, CFO, AUROBINDO PHARMACEUTICALS
* Weighted deduction on R&D spend outside the country.
.
OTHER MEASURES SOUGHT BY PHARMA INDUSTRY:
* Fiscal incentives for research be valid for at least 10 years.
* Weighted deduction on expenditure on research be raised to 200% from
150%.
* Land and building for research be considered for depreciation.
* Reduce penalties on transfer pricing to international levels of
0-40%.
* Total exemption for life saving drugs from customs duty.
* Increase abatement to 55% from existing 42.5%.
.
.
CEMENT
======
D.D. RATHI, DIRECTOR & CHIEF FINANCIAL OFFICER, GRASIM INDUSTRIES
* Desirable that taxes, including excise, can be brought down.
* Abolition of import duty on coal, pet coke; allotment of captive
coal mines.
.
VINOD JUNEJA, DEPUTY MANAGING DIRECTOR, BINANI CEMENT
* Increase in import duty on cement to at least 5% as against nil now.
* Import duty on coal can be removed.
* Simplification of excise structure; duty be cut by at least 5% vs
16% now.
.
P.C. NALWAYA, MANAGING DIRECTOR, ANDHRA CEMENTS
* Countervailing duty on imported cement be reimposed.
* A flat excise rate.
.
CEMENT MANUFACTURERS' ASSOCIATION
* Cut taxes, which currently account for over 60% of ex-factory price.
* Abatement of 55% on excise duty on cement.
* Reduce royalty on limestone from current 45 rupees per tn.
* Supply of fly ash for 10 years free of cost.
* Cut VAT on cement, clinker to 4% in line with steel sector.
.
.
MUTUAL FUNDS
============
KRISHNAMURTHY VIJAYAN, CHIEF EXECUTIVE OFFICER, JPMORGAN MUTUAL FUND
* Bond funds should be placed on par with equity funds for taxation
.
SANDESH KIRKIRE, CHIEF EXECUTIVE OFFICER, KOTAK MAHINDRA MUTUAL FUND
* Maintain status quo on dividend distribution tax on debt plans.
* Bring fund of funds schemes on par with underlying scheme.
* Tax on overseas funds investing in equity should be same as equity
fund.
.
RAJIV SHASTRI, HEAD, BUSINESS DEVELOPMENT, LOTUS INDIA MUTUAL FUND
* Taxation on mutual funds should remain neutral.
* Fund of funds schemes should enjoy same benefits as equity funds.
.
DEVENDRA NEVGI, CHIEF INVESTMENT OFFICER, QUANTUM MUTUAL FUND
* Liberalise FII investments into mutual funds further.
* Relax restrictions on pension money flow into market.
.
.
ECONOMISTS
==========
SUBIR GOKARN, CHIEF ECONOMIST, CRISIL
* No change in direct taxes.
* Change petroleum duty structure to specific duty.
* Integrate excise duty, service tax to move towards GST.
* Transitory tax on short-term capital flows.
* Measures to take stock on social spending.
.
ABHEEK BARUA, CHIEF ECONOMIST, HDFC BANK
* Concrete steps to plug leakage in excise collections.
* Reassert commitment to fiscal consolidation.
* Remove surcharge on direct taxes; reduce exemptions.
* Reintroduce tax-free bonds for infrastructure sector.
* Relax external commercial borrowing norms for infrastructure sector.
.
SUMITA KALE, CHIEF ECONOMIST, INDICUS ANALYTICS
* Focus on implementation and delivery of subsidies.
.
SHASHANKA BHIDE, SENIOR RESEARCH COUNSELLOR, NCAER
* Non-tax incentives to improve investment opportunities.
* Attempt to ensure demand does not slow down significantly.
* Measures to raise resources for infrastructure development.
.
COMMODITY MARKET
================
P.H. RAVIKUMAR, CEO, NATIONAL COMMODITY AND DERIVATIVES EXCHANGE
* Allow banks and mutual funds to participate in commodity market.
* Allow foreign brokers to participate in commodity market.
.
KAILASH GUPTA, MANAGING DIRECTOR, NATIONAL MULTI COMMODITY EXCHANGE
* Offset profit and loss in market against normal business income.
.
JOSEPH MASSEY, DEPUTY MANAGING DIRECTOR, MCX LTD.
* Offset speculative profits from derivatives against normal business
income.
.
ANJANI SINHA, CEO, NATIONAL SPOT EXCHANGE
* Formulation national policy on agricultural marketing reforms.
.
SUNIL RAMRAKHIANI, CEO, WAY2WEALTH BROKERS PVT. LTD.
* Encourage participation of banks and mutual funds in commodity
market.
* Allow FIIs to participate in commodity market.
* Uniform sales tax regime across states for exchange-related
deliveries.
* Income from hedging transactions should be treated as business
income.
.
KISHORE NARNE, VICE-PRESIDENT (COMMODITY RESEARCH), ANAND RATHI
* Revoke ban on futures trading on wheat and rice.
.
.
AGRICULTURE
===========
M.S. SWAMINATHAN, FORMER CHAIRMAN, NATIONAL FARMERS' COMMISSION
* Loan waiver for very poor farmers, in areas with high suicide rates.
* Creation of a price stabilisation fund.
* Reduction in farm loan rates to 4%.
* Increase in crop loan recovery cycle to 4-5 years.
.
D.K. JOSHI, SENIOR ECONOMIST, CRISIL LTD.
* Focus on increasing farm productivity.
* Higher allocations to irrigation and farm research sectors.
* Schemes for employment generation and skill upgrade.
.
U.S. AWASTHI, MANAGING DIRECTOR, INDIAN FARMERS FERTILISER COOPERATIVE
* Higher fertiliser subsidy.
* Cess to fund fertiliser subsidy burden.
.
R.G. AGARWAL, CHAIRMAN, CROP CARE FEDERATION OF INDIA
* Cut in excise duty on pesticide.
.
B.V. MEHTA, EXECUTIVE DIRECTOR, SOLVENT EXTRACTORS' ASSOCIATION OF
INDIA
* Treat edible oils and oilseeds on par with essential commodities for
VAT.
* VAT on oilseeds should be reduced to zero or 1%.
.
S.L. JAIN, DIRECTOR GENERAL, INDIAN SUGAR MANUFACTURERS' ASSOCIATION
* Reduction in excise duty on molasses.
.
.
AUTOMOTIVE
==========
DILIP CHENOY, DIRECTOR GENERAL, SOCIETY OF INDIAN AUTOMOBILE
MANUFACTURERS
* Uniform 16% excise duty across all automobile segments.
* Measures to reduce interest rates.
.
PAWAN GOENKA, PRESIDENT, AUTOMOTIVE SECTOR, MAHINDRA & MAHINDRA LTD.
* Uniform 16% excise duty across all automobile segments.
.
H.S. GOINDI, SENIOR VICE-PRESIDENT, TVS MOTOR CO.
* Cut excise on two-wheelers to 8%.
* Measures to improve retail credit availability.
.
RAVI PISHARODY, VP, SALES & MARKETING, COMMERCIAL VEHICLES, TATA
MOTORS
* Cut in excise duty on commercial passenger vehicles.
* Duty reduction in goods carriers.
* Measures to reduce interest rates.
.
L.D. MITTAL, CHAIRMAN, SONALIKA GROUP
* Govt loans to farmers to buy tractors.
.
NEERAJ KANWAR, JOINT MANAGING DIRECTOR, APOLLO TYRES
* Correction of anomaly between import duty on natural rubber and
tyres.
.
.
OIL & GAS
=========
M.S. SRINIVASAN, SECRETARY, MINISTRY OF PETROLEUM & NATURAL GAS
* Declared goods status for natural gas, liquefied natural gas, bio-
fuels.
* Waiver of customs duty on LNG imports.
* Reduction of ad valorem excise duty on petrol, diesel to nil.
* Exemption from service tax on exploration and exploitation.
.
S.V. NARASIMHAN, DIRECTOR-FINANCE, INDIAN OIL CORP. LTD.
* Find ways to reduce impact of crude price surge on marketing
companies.
* Cut customs duty on crude imports and excise duty on petroleum
products.
* Infrastructure status for oil product pipelines.
* Rationalisation in corporate taxes.
.
R.K. GOEL, DIRECTOR FINANCE, GAIL (INDIA) LTD.
* Waiver of customs duty on LNG import for all sectors.
.
OM NARAYAN, MANAGING DIRECTOR, INDRAPRASTHA GAS LTD.
* Infrastructure status for city gas distribution pipeline.
* No value-added tax on piped natural gas.
.
T.K. ANANTH KUMAR, DIRECTOR FINANCE, OIL INDIA LTD.
* Exemption from levy of service tax on exploration and production.
* Cut in some corporate taxes--at least the surcharge on oil, gas
industry.
.
.
STEEL
=====
R.K. SHARMA, PRESIDENT, FEDERATION OF INDIAN MINERAL INDUSTRIES
* Withdrawal of export duty on iron ore.
* Complete removal of import duty on steel.
.
J. SARMA, INTERIM STEEL SECRETARY, GOVERNMENT OF INDIA
* Import duty cut for metallurgical coal, scrap metal.
* Ad valorem (value-based) export duty on iron ore.
.
N.C. MATHUR, DIRECTOR, CORPORATE AFFAIRS, JINDAL STAINLESS
* Scrap import duty on all three nickel products and steel scrap.
* Import duty on cold-rolled steel be doubled to 10%.
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K.Karthik Raja
www.kences1.blogspot.com