NEW DELHI: In a bid to boost demand, industry lobby group CII has proposed that the Center issue “consumption vouchers” to citizens in the lower income group, which can be used to buy specified goods and services within six-eight months, while also recommending a 40% hike in daily wages under MGNREGA and a 33% increase for PM-KISAN beneficiaries.
In its pre-budget recommendations, CII has further suggested that the unit cost under PM Aawas Yojana should also be enhanced, along with changes in tax treatment for interest income to support the growth of bank deposits. An enhancement of capex by 25% to Rs 14 lakh crore is part of the suggestions.
The proposals come at a time when urban demand is seen to be weak, while companies such as HUL and Nestle are acknowledging a pickup in rural demand. Given the impact on the overall spending and difficulty in tracking the use of vouchers, the recommendation may be trashed by govt. In the past, the Center considered an increase in PM-KISAN dole being enhanced from Rs 6,000 to Rs 8,000 annually, but it did not receive political clearance.
In its tax proposals, CII has backed a three-slab GST structure, which includes petroleum, electricity and real estate and speed up resolution of disputes, while making the legislation simpler.
Both Ficci and CII have also flagged their concerns over the complex tax deducted at source and tax collected at source structures and pointed to the need to revisit the multiple rates prescribed by tax authorities.
Ficci has also recommended that reimbursement of day care expenses should be exempted from perquisite taxation. It has also suggested that there should be binding timelines for tax officials, a move that was proposed on the charter for taxpayers that released several years ago but has not been acted upon.
CII has also laid out an ambitious roadmap for disinvestment, which is on the backburner and also reviving the asset monetization pipeline, arguing that the two initiatives can help generate funds to meet the requirements of higher spending.
