New Delhi: The Government has sought the public’s views on ending 162 tax exemptions for companies and individuals.
The Government wants to broaden the tax base and simplify taxation and for that to happen exemptions on housing loans, contributions to provident funds, pension, VRS package and farm income may go.
The Finance Ministry has invited comments from the public and other stakeholders by July 5 for removal or continuance of these exemptions.
On top of the Ministry's agenda is the politically sensitive exemption on farm income. Farm income comes in the state list and for it to be brought under income tax the Constitution would have to be amended.
The Centre lost around Rs 58,000 last year due to tax exemptions like those available to Special Economic Zones (SEZs) and accelerated depreciation by companies.
According to sources, the ministry wants control over SEZs’ fiscal matters and restrictions on sops for services they provide.
The Commerce Ministry administers SEZs, and the Finance Ministry believes this has resulted in triggering demands.
Sources in the Finance Ministry also said tax sops for OBUs of Indian and foreign banks "unsettle" the viability of capital markets and financial institutions.
Comments sought regarding removal or continuance of exemptions and deductions
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