India Inc will not get call for extra tax in March: Revenue Secretary

Our Bureau New Delhi | Updated on August 12, 2021

DIPAM Secretary says it’s a 1991 moment for public sector enterprises

Revenue Secretary Tarun Bajaj assured India Inc that the tax department will not dial them for extra tax in March.

Addressing the annual general meeting of industry chamber CII, Bajaj said the tax regime is now stable and India Inc should not look at the Union Budget for any rate change. He also appreciated the industries for their improved performance during the pandemic, which was reflected in the earnings. He said revenue had increased without any rise in tax rate. Also, there was no phone call from the tax department to pay more in March, he said, adding that this will continue.

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“I can assure you that one of the things we will work on... that we will try and get due taxes from you, yes... for that we might call you. We might make calls to you to understand what the advance taxes you are planning to pay, only for understanding and planning for our own revenues... but we will not call you asking to pay extra taxes in the month of March,” he said.

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Asked about the high GST rate on two-wheelers, he said not just two-wheelers but even four-wheelers attract GST of 28 per cent plus cess. This will continue some more as the cess has been extended beyond June 2022, he said, referring to the borrowing against cess receivables to pay compensation shortfall.

Tuhin Kanta Pandey, Secretary, Department of Investment and Public-Asset Management (DIPAM), said the new policy on public sector enterprises, which was announced in the budget, would be the 1991 moment for that sector.

He said the strategic disinvestment of Air India, BPCL, Shipping Corporation, Neelanchal Ispat and others will be completed this fiscal. “We seem to be moving firmly on all these,” he said, adding that the mega IPO of LIC will take place towards the end of this fiscal.

Asked why PSU shares are not rated highly in the stock market, he said it depends on a number of things, but hoped this will change after the new PSE policy.

“It is 1991 moment for public sector... the new PSE policy. In 1991, organisational reforms could not be carried forward while there were many structural reforms such as export-import, import substitution policy, lot of macro-economic reforms, lot of industrial reforms and the private sector was brought in, but existing public sector has remained even after 30 years. I think this is the time when, for example, look at the insurance companies. [A] Lot of private insurance companies have come. Now there is real competition. So how does a public sector retain its edge vis-à-vis private sector unless they bring in same level of flexibility, autonomy, operational efficiency and the leadership. If it is not forthcoming, we can’t really expect them to be highly rated,” he explained.

Published on August 11, 2021

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