Wishlist FY2009-10

CII pre-Budget memorandum for the Union Budget 2009-10

The Confederation of Indian Industry in its pre-Budget memorandum for the Union Budget 2009-10 has suggested single window information on the foreign direct investment, preferably through the Ministry of Overseas Indian Affairs.

§ CII has suggested maintenance of comprehensive statistics on all FDI in SME sector.

§ To encourage FDI participation by NRIs in the SME sector, there should be no export obligation, continuing SSI status even if FDI is more than 24 per cent.

§ Also a separate platform of facilitation, automatic approval for 100 per cent FDI from NRIs and other promotional measures need to be taken.

§ Rationalization of transfer pricing regulations under both the Income Tax Act and Customs Act should be there.

§ Modifications in the Service Tax Act to allow Service Tax Credit, where an assesse is engaged both in manufacturing and trading of goods.

Pharmaceutical wish list for FY2009-10

The pharmaceutical industry wants the forthcoming federal budget to grant incentives to boost exports and extend the scope of tax breaks given for research and development work.

§ Tax breaks of up to 150 percent of a firm’s research expense by five years to 2012 should be extended by another five years to 2017.

§ Tax breaks should also be given to drug firms involved solely in R&D and also cover all expenses incidental to basic research, including clinical trials, done in India or abroad.

§ The industry is hoping for some exemptions for export activities as tax breaks for export-oriented units, which were set up to encourage exports, are set to expire in 2009.

§ The industry is also seeking reduction of excise duties on drugs to 8 percent from 16 percent now.

§ The weighted deduction for R&D under Section 35 (2AB) should be raised from 150% to at least 200%. It should be extended to all expenditure incidental to basic research carried out at any R&D unit, including clinical trials and bio-equivalence studies. This should be available to expenditure on obtaining approvals and filing patent applications also.

§ A dire need for provision of common infrastructure facilities for waste treatment and water supply to industry units by the government in regards to a uniform environmental law – 10% of its revenues goes towards investments on waste management.

§ SEZ benefits should be provided to all exporting units to make exports more competitive.