First tranche of corporate tax reduction in next Budget: Arun Jaitley

New Delhi: Finance Minister Arun Jaitley, on November 4, said the government in the next few days will list out the exemptions to be phased out as part of its plans to gradually bring down corporate tax rate to 25 per cent, the first tranche of which will be announced in the Budget in February.

"I have announced a road map for direct taxation... (to) bring corporate tax down to 25 per cent by phasing out some of those exemptions. We are going to put in public domain in the next few days some of those exemptions that we intend to phase out in the first round," he said while addressing corporate leaders here.

"The first tranche of reduction of corporate tax... I hope to do it in the near future whenever the new Finance Bill comes up." Jaitley made these comments while participating in an interactive session at the 'National Strategy Day in India' organised by the World Economic Forum (WEF) and the Confederation of Indian Industry (CII).

The Minister in his Budget in February had announced the government's intention to reduce corporate tax from 30 per cent to 25 per cent over the next four years. Jaitley also said the government has been able to address various tax legacy issues, including those pertaining to retrospective tax amendment, though two-three problems remain.

"Systematically, one by one, we have been resolving (taxation issues)... That fear of retrospective taxation has gone. Two-three of those problems remain and they remain because of legal reasons. I have publicly announced that we are looking for processes by which we can resolve some of these," Jaitley said.

GST has made "considerable headway", Jaitley said that the parliamentary standing committee had recommended it and the Lower House had passed it by a two-third majority. “Almost all state governments are on board. And I must say even the state governments of the Congress party have supported it," he said further.

However, Jaitley added: "I say with a sense of regret that there was a policy somersault as far as the Congress is concerned and regrettably, it was led by the people who had moved the GST Bill. This policy somersault was not for any policy reason; it was for political reason because the policy seems to be obstructive. The Minister has been discussing the issue of passage of the GST Bill with leaders of the Congress and other political parties.”

“I am willing to discuss with the Congress party... I have so far discussed with their leaders and I can't find, at least, conceptual opposition to it. I will once again speak to them and try to make them see reason," Jaitley said.

He added that the composition of the Rajya Sabha would change in coming months and would make it easier for the government to function. Jaitley is of the view that the public opinion is in favour of economic reforms and against those who obstruct them.

"Temporarily, they may be able to halt certain measures. But I think once the direction is set, the movement for that change will go on," he said. Global investors, Jaitley said, have shown interest in India at a time when the world economy is passing through a “very challenging moment".

"We set a direction for the Indian economy... consistently with every measure, we are moving in that direction and we are not allowing any policy change which is in contrarian direction. I think India has become highly aspirational," he said.