Comments
The new Government should take Life Insurance Corporation public, boost financial savings through enhanced tax breaks and set up a dedicated asset reconstruction company (ARC) for infrastructure assets. These are some of the suggestions bankers gave Finance Minister Arun Jaitley and Minister of State Nirmala Sitharaman at a pre-Budget meeting here on Tuesday.
Banks also pitched for a 100 per cent tax deduction on the provisions they make towards bad debt. A case was also made for an increase in the threshold for deduction of tax at source on interest on fixed deposits from the current level of ₹10,000 to, say, ₹20,000.
A game-changer Uday Kotak, Founder and Executive Vice-Chairman, Kotak Mahindra Bank, said he had suggested that state-owned life insurer LIC be taken public.
“Listing of LIC can be a huge game-changer for the Indian financial system,” he said. This idea need not be pursued in the upcoming Budget itself, but over the next few years.
The Centre need not lose control and should hold at least 51 per cent in the life insurer, Kotak suggested, adding that taking LIC public could bolster Government revenues.
Kotak said he had also made a case for a “dramatic revamp” of the Rajiv Gandhi Equity Savings Scheme.
Bankers have suggested that the Centre needs to double the Section 80C limit from ₹1 lakh to, say, ₹2 lakh. A demand was also made for re-introduction of Section 80CCF, a specific tax break to boost investment in infrastructure bonds.
HSBC India chief Naina Lal Kidwai said the meeting discussed at length the issues surrounding non-performing assets in the banking system and how existing laws such as Sarfaesi need to be fine-tuned. A case was also made to improve the functioning of debt recovery tribunals, she added.
Finance Industry Development Council Member Raman Aggarwal said he had, on behalf of asset-based non-banking finance companies (NBFCs), made a case for tax deductions on provisions for bad debts.
Meeting with economists Nagesh Kumar, Director of ESCAP’s South and South West Asia office, said there were parleys on reviving the industrial and manufacturing sector. “There was some discussion about simplification of tax laws and recalibration of expenditure and revenue side”, he said after the meeting.
Surjit Bhalla, Chairman of Oxus Investments, said the budget should be a “non-Congress” budget. “It should be substantially different both in the way of raising taxes and how monies are going to be spent,” he said.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.