Sharing his expectations from the upcoming Budget 2023, Hindustan Unilever (HUL) CEO Sanjiv Mehta said he would like to see a further extension in timeline for the concessional 15 percent corporate tax rate for manufacturing companies.
“India is a fabulous place for manufacturing. Increasing the concessional tax rate for companies by another five years will help India capitalize on the China+1 and Europe+1 opportunities,” HUL's Mehta said in a press meet.
In September 2019, the government had said that any new domestic company incorporated on or after October 1, 2019, making fresh investment in manufacturing, would have an option to pay income-tax at the rate of 15 percent if they commenced their production on or before March 31, 2023.
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This deadline was later extended till March 2024, and going by Mehta’s wish list for Budget 2023, it should be extended till 2029.
Second on his wish list is the simplification of capital gains tax. Currently, shares held for more than one year attract a 10 percent tax on long-term capital gains.
Gains arising from sale of immovable property and unlisted shares held for more than 2 years and debt instruments and jewellery held for over 3 years attract 20 percent long term capital gains tax.
“This complex structure must be simplified,” said Mehta.
Reportedly, the revenue department is looking at rationalising the rates as well as the holding period for calculating these taxes and an announcement is likely on February 1.
Last but certainly not the least, Mehta wants the government to improve India’s innovation quotient. “For this, the government will have to spend and encourage more research and development (R&D) in the country. This can make India an innovator,” he said.
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