The Hindu Business Line : BUDGET WISH-LIST

Unlike the manufacturing and services sectors, which have been growing at 9-10 per cent, the agri sector, accounting for 18.6 per cent of GDP, has been sluggish with a growth of 2 per cent. But in the agri sector, the dairy sector has the potential to grow faster, on a par with the manufacturing and services sector.

The dairy sector has grown at 4 per cent in the past and accounts for 23 per cent of agriculture. This sector deserves encouragement. Any detrimental knee-jerk policies such as export ban of dairy ingredients will become fatal to the farmers and the industry. Milk is the only commodity that offers assured earning potential for the farmer and ensures liquidity to him. Moreover, the farmer gets 65 per cent of the consumer price back in his hands, unlike vegetables and fruits, for which farmer gets only 15 per cent of the value paid by the consumer.

The Government must give priority to the dairy sector. The sector has to be encouraged for the prosperity of the 57 per cent of population residing in the rural areas in conditions of absolute poverty. Among agri loans, dairy sector loans have better solvency.

R. G. Chandramogan MD, Hatsun Foods

Sales tax

The Government of India should recommend to all State Governments to waive sales tax on goods and services that are transacted through electronic mode (e-commerce) for the next five years, up to limits to be prescribed by the Government. This recommendation should be then followed with legislation to ensure execution by the State governments.

Murugavel Janakiraman CEO, Consim Info Pvt Ltd

Tax refunds

I am sure this Budget will be ‘Aam Aadmi’ Budget. There are several Aam Aadmi who have paid income-tax and filed IT returns for refund of excess tax paid by them and/or deducted from their income. The I-Tax department is turning a blind eye to these cases for its own reasons. Trips to the Income Tax office are not yielding any results. I wish the Finance Minister would order the I-Tax department to clear all refund cases in three months and help Aam Aadmi to get his money back.

S. Vedantham e-mail

Black to white

Here are a couple of wishes for the 2008 Budget, for India’s benefit.

1. I strongly believe if the black money in India is converted to white, it will help the economy move towards the 2020 target.

Recommendation: Allow one to invest in a list of investments (such as school, hospital, community services, and so on) and in mutual funds by government-owned and -controlled such as the LIC, the SBI and any postal service bonds. Any such investment source should not be questioned if it is locked for three or more years. The interest/bonus/profit should be taxed !

2. The US- and UK-based NRIs should be allowed to invest in the Indian stock market, directly or through mutual funds. There are several young Indians working abroad for several years who were not able to invest and join the market. This step will boost the market and the economy.

Recommendation: Anyone who is Indian Citizen should be allowed to participate in the Indian market.

Sankar Ramu Software Engineer, US

Tax structure

I think the Finance minister should take steps to simplify the tax structure in both the direct and indirect taxes. In direct taxes, one area in which massive revenue leakage occurs is real estate.

Like the securities transaction Tax (STT) for stocks traded, The Finance Minister should put a flat tax of, say, 4 per cent on all sale proceeds to be collected by the registrars and deposited in the Central Government account and abolish long-term capital gains (LTCG) tax.

And, similar to the stock taxation regime, assesses are free to opt for indexation and higher tax and to take credit for the registration tax.

He should also treat power of attorney as deemed sale for this purpose.

In indirect taxes, the Finance Minister should impose a flat rate and remove all exemptions, especially for the small-scale sector.

R. Ayyanadar Karthik Sivakasi

Income-tax

In view of the ever increasing cost of living, the I-T slab rate must be raised to Rs 2 lakh for men and Rs 2 5 lakh for women. This will leave more disposable income in the hands of the individuals and hence boost the consumption, savings and investments in the economy.

Jailesh Mehta Palakol (A.P.)

Standard deduction

A standard deduction of 25 percent of gross salary should be given for the salaried employees (who have no option other than being honest in paying tax.) This is on account of the expenses they incur for their employment.The limit of Rs 1 lakh under Sec.80C should be enhanced to Rs 2 lakh in order to encourage more savings and investment. The minimum exemption limit should be enhanced to Rs 1.5 lakh for men; Rs 1.75 lakh for women and Rs 2 lakh for senior citizens. Basic services like telephone may be exempted from service tax.Excise duty for all intoxicating items should be doubled.

K. Ramasami Coimbatore

Alternative energy

The Finance Minister must consider giving tax benefits to people who use solar products (solar cookers, water heaters or for lighting), similar to US Government’s Energy Policy Act of 2005. The Government should encourage the use of alternative energy sources by giving tax benefits so that energy conservation is encouraged.

R. S. Sundar Chennai