The Hindu Business Line : ICAI suggests changes in fringe benefit tax

Although certain modifications are needed, fringe benefit tax has come to stay and the realisation seems to have dawned on most of the trade bodies in the country, Mr T. N. Manoharan, President of the Institute of Chartered Accountants of India (ICAI), said.

At a press meet here on Saturday, after the inauguration of the two-day regional conference of the institute, he said the ICAI had suggested to the Union Government that certain exemptions be made to FBT on the basis of the turnover, the number of employees or the quantum of expenditure under the head. "We are hoping for a positive response from the Government. That will greatly reduce the problems. But the tax has come to stay," he said.

Centres of excellence

He said the ICAI was setting up 17 centres of excellence in the country, the first one being in Hyderabad, to stimulate research in the field. "We are investing Rs 14 crore on the Hyderabad centre, which may be ready by January 2007," he said.

He said there was great demand for Chartered Accountants in the country, especially from the software companies, and "at least 30,000 more are required. We have at present 1,30,000 members and every year 7,000-8,000 are graduating, but that is not enough."

Even for a newcomer, the software companies are paying as much as Rs 12 lakh a year, he said. Steps were afoot to revise the curriculum and to reduce the duration of study to four years from five years and three months.

The institute is also preparing accounting standards for local bodies and the Union Ministry of Urban Development is considering the issue, he added.

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