Budget 2015: Simplify tax rules to promote the development of SMEs

The Economic Times,

DA  ET SpecialBy Dinesh Agarwal
For the Union Budget, 2015, my wish- list would be:

1) Simplification of Tax & Regulatory Environment – In view of the growing importance of SMEs in the country and their potential to significantly contribute to the economic growth, it is important to simplify our tax rules, which could further promote the development of SMEs. Government should introduce a slew of measures to propagate a conducive and friendly tax environment and also provide clarity in tax laws. We also look forward to a uniform policy being formulated for all states to enable a single-window clearance system for various approvals, and also a single registration for VAT and other taxes.

A simplified, reformed tax regime for start-ups and SMEs will definitely help to develop a business environment conducive for nurturing businesses during its initial years of existence. Moreover, the state-level taxation must be resolved, by implementing a ‘One-India’ approach, rather than a state-based approach. ‘One India’ Approach would ensure uniformity and will play a pivotal role in driving growth. Levying of ‘E-commerce tax’ at central level can be looked at. This would also enable the industry to be globally competitive in today’s economic environment.

2) Greater allocation to Power – In the light of the ‘Make in India’ campaign, which has brought a wave of optimism in the industry, the Government should introduce favorable policies and measures which will give a thrust to investments in the power industry and aid capacity additions. Natural Gas, which is a good source of power, faces various duties and taxes like customs duty and this makes the price of gas unaffordable. Shortage of coal is a major problems hurting India’s power generation. Inadequate domestic production and infrastructure bottlenecks continue to act as constraints for ensuring adequate supplies to power plants

Thus, the entire ecosystem of the power sector – from generation to distribution – needs attention now, when the Center is committed to the development of the economy and removal of the bottlenecks.

3) Technology Upgradation – Technological breakthroughs would be the future drivers of economic growth, and the practical ways to address the challenges and opportunities of the fact-paced environment. A greater access to modern technology and availability of funds to upgra ..

Dinesh Agarwal, Founder & CEO, IndiaMART.COM & TiE-Delhi NCR Charter Member

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