Nifty99000 100%

Sensex99000 100%

Article rating: 3.1
Article rating: No rating
Article rating: 5.0
Article rating: 4.5
Article rating: 5.0
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: 4.7
Article rating: 4.0
Article rating: 3.5
Article rating: No rating
Article rating: No rating
Article rating: 4.0


US Inc. charts wishlist before budget

Author: IANS/Monday, January 29, 2018/Categories: Government

US Inc. charts wishlist before budget

Washington/New Delhi - Ahead of Finance Minister Arun Jaitley's last full Union Budget, the US-India Business Council (USIBC) has urged him to further reduce tax uncertainty for multinational companies and foreign investors, even as Indian industry has voiced its own areas of concern.

In a memorandum submitted to Jaitley, the USIBC has said that such measures would help improve the country's investment climate and attract more foreign direct investment to India.

"A significant positive step toward improving the investment climate would be to further reduce tax uncertainty for multinational companies and institutional investors in India," said USIBC President Nisha Desai Biswal, who was Assistant Secretary of State for South and Central Asian Affairs in the Obama administration.

"Tax uncertainty results in an increase of risk when investing in any given project drives investors to either withhold investments or require a higher rate of return to account for this risk, thus raising the cost of capital in the uncertain market," she said. 

The USIBC said India needs to create a more stable and predictable fiscal regime and address retrospective taxation and legacy cases that remain open.

"USIBC members believe that unless resolved, the lack of clarity in the government's approach to taxation risk will undermine progress in other areas of the economy and will continue to damage India's reputation among investors," the memorandum said.

Continued lack of predictability in some Indian tax policies stands as a "major deterrent" for global capital, dampening the effects of any policy and regulatory reforms made to encourage this capital, it added. 

The USIBC also said India must ensure that transfer pricing principles are applied in a fair and consistent manner for all taxpayers, as well as allow a reasonable method for determining transfer pricing comparables that support fees on services performed in India for non-Indian affiliated entities and match the nature of the company's services performed.

"To facilitate cross-border trade and investment without the barrier of double taxation, the Governments of India and the US should reaffirm the shared commitment to improving tax dispute resolution. 

"To that end, the two governments should work to modernise the US-India Bilateral Tax Treaty to reflect the current business and investment environment," it said. 

British consulting multinational Deloitte's Indian arm said in New Delhi that the forthcoming Budget is expected to "address the key challenges facing the economy". 

"The government is likely to give special attention on alleviating the stress that has built up in the rural economy while also pushing infrastructural projects. All such measures would be aimed to reviving consumer sentiment and demand, especially in the rural sector," Deloitte India Senior Economist Richa Gupta said in the statement. 

Green Energy producer Amplus Solar called for a special push to make rooftop solar power more affordable. 

"We recommend to exempt all components used in rooftop projects from custom duty and GST," Amplus Energy CEO Sanjeev Aggarwal said in a statement.

"In April 2017, 10 year income tax holiday was discontinued for renewables. Of all renewable streams, rooftop has taken a severe hit as generation cost is increased by 15-20 paise/unit. We recommend to reinstate 10 years tax holiday for rooftop projects," he added.

"The government has sought to reclassify imported solar panels and modules in a category that attracts 7.5% duty and various kinds of cess whereby the cost of a solar cell, around 30 cents at present, will go up to around 50 cents for Indian developers if 70% safeguard duty is imposed. 

"The cost of solar power will accordingly go up to around Rs 7 per unit. We do hope the forthcoming budget will address this issue," said Eastman Auto & Power MD Shekhar Singal. 

RICS called for the real estate sector to be brought under the Goods and Services Tax (GST) regime and tax incentives for first-time home buyers. 

"Real estate sector should be brought under the purview of GST. We expect rationalisation of GST rate at 12% and inclusion of stamp duty under GST. GST at the rate of 18% on long term leased land is not healthy for the industry and this anomaly needs to be corrected," said RICS Director Sunil Aggarwal. 

"In this year's Budget, we would like to see industry status conferred on the entire real estate sector. This has been a long pending demand of the industry," he added.

Print Rate this article:
No rating

Number of views (200)/Comments (0)

rajyashree guha


Other posts by IANS
Contact author

Leave a comment

Add comment



Ask the Finapolis.

I'm not a robot
Dharmendra Satpathy
Col. Sanjeev Govila (retd)
Hum Fauji Investments
The Finapolis' expert answers your queries on investments, taxation and personal finance. Want advice? Submit your Question above
Want to Invest



The technical studies / analysis discussed here can be at odds with our fundamental views / analysis. The information and views presented in this report are prepared by Karvy Consultants Limited. The information contained herein is based on our analysis and upon sources that we consider reliable. We, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and we are not responsible for any loss incurred based upon it. The investments discussed or recommended in this report may not be suitable for all investors. Investors must make their own investment decisions based on their specific investment objectives and financial position and using such independent advice, as they believe necessary. While acting upon any information or analysis mentioned in this report, investors may please note that neither Karvy nor Karvy Consultants nor any person connected with any associate companies of Karvy accepts any liability arising from the use of this information and views mentioned in this document. The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above mentioned companies from time to time. Every employee of Karvy and its associate companies is required to disclose his/her individual stock holdings and details of trades, if any, that they undertake. The team rendering corporate analysis and investment recommendations are restricted in purchasing/selling of shares or other securities till such a time this recommendation has either been displayed or has been forwarded to clients of Karvy. All employees are further restricted to place orders only through Karvy Consultants Ltd. This report is intended for a restricted audience and we are not soliciting any action based on it. Neither the information nor any opinion expressed herein constitutes an offer or an invitation to make an offer, to buy or sell any securities, or any options, futures or other derivatives related to such securities.

Subscribe For Free

Get the e-paper free