Monday, July 6, 2009

India Inc welcomes Budget with reservations

India Inc on Monday welcomed the focus on reviving economic growth to 9 per cent as also the indications for bold tax reforms, but expressed regret that the Minimum Alternate Tax was raised and Security Transaction Tax was let to continue.

"Finance Minister Pranab Mukherjee's efforts to revive the economy back to nine per cent (growth) is in the right direction," ICICI Bank MD and CEO Chanda Kochhar said today.

"I am happy on behalf of the whole industry that Fringe Benefit Tax has been abolished, but I am a little bit unhappy about MAT," top industrialist Rahul Bajaj said.

The MAT rate was hiked to 15 per cent from 10 per cent. Kochhar felt that the Securities Transaction Tax too should have caught the government's attention.

"Health care sector has been ignored. We had been expecting a boost for the health care infrastructure, but nothing has been said. Budget was mute. We are disappointed," Shivinder Mohan Singh of Fortis said.

The stock market tanked 700 points mid-way during Mukherjee's Budget speech, but recovered partially at 1315 hrs.

The industry also welcomed restoration of seven year tax break on natural gas production, saying it will help attract foreign bidders for NELP-VIII.

"This was always there. It is not a new benefit. We are very happy about the clarification as it ends the ambiguity," said P M S Prasad, President and CEO (Oil & Gas), RIL.

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