India Inc discusses high tax, inflation, job avenues with finance minister Nirmala Sitharaman

New Delhi: Amid slowing the consumption demand in both rural and urban areas in the country, India Inc on Monday met finance minister and discussed various issues related to the common man, including the burden of high tax for middleclass, inflation, job opportunities among others. Besides, the industry representatives also flagged concerns over an issue of dumping of excess stock by China globally, including in India and challenges posed to food security as well.

Ahead of the Union Budget for 2025-26, which will be presented on February 1, this is the fifth customary pre-Budget meeting of the FM with industry bodies. Apart from the finance minister who chaired the meeting, top officials of the ministry including finance secretary, secretary of department of investment and public asset management (Dipam), secretaries of the department of economic affairs and the chief economic adviser to the Government of India, among others also attended the meeting.

During the meeting, industry bodies sought reduction in personal income tax rates to ensure higher disposable income in the hands of the middle class, reduction in excise duty on fuel, and measures to provide impetus to employment-intensive sectors among others. They also raised the issues that are facing small and medium businesses due to dumping of excess stock by China globally, including in India, and challenges posed to food security and inflation due to the “climate emergency”.

After the meeting, CII president Sanjiv Puri told the media that while the Indian economy is doing very well, globally there are a lot of challenges. “We are seeing dumping of a lot of products (by China) into various parts of the world, including India. We also have the issue of climate emergency, which, besides other things, also impacts food and nutrition, (food) security and inflation. In this context we have made several suggestions and ideas,” Puri said, suggesting that excise on petroleum be reduced a little, that will also provide higher disposable income and contribute to a virtuous cycle in the hands of the consumers.

“The CII has already sought measures to provide impetus to areas that have large employment potential like garments, footwear, tourism, furniture, among others, apart from making suggestions for MSMEs and integrating India into global value chains. From a perspective of boosting consumption, we have suggested that there be some relief provided to income tax up to a Rs 20 lakh on the marginal income tax rate so that it boosts consumption, there is more disposable income and in turn also leads to buoyancy in revenues,” he added.

Ficci vice president Vijay Sankar, who was also present in the meeting, also said that the finance minister and her colleagues gave a very patient hearing to the industry today. “There were about 13 people from different industry chambers. There was some commonality of themes across some of the representations, basically the temporary slowdown faced due to dumping products especially by some of our neighbours like China due to the slowdown in their economy,” he said.

“We emphasised on what the MSMEs need because they are the backbone of the supply chain. Whether it is credit flow, complex registrations, multiplicity of TDS. We focused on simplification of procedures and rationalisation of things like TDS,” said Assocham president Sanjay Nayar.