The industry body has suggested increasing capital spending to 3.3-3.4% of GDP in FY24 from 2.9% currently, with the aim of raising it further to 3 .8-3.9% by FY25. He stressed the need to revitalize investment as well as consumer demand.
According to Sanjiv Bajaj, President of CII, a fresh look at capital gains tax is needed with respect to its rates and holding period to remove complexities and inconsistencies. He also suggested that personal income tax rates be reduced to give consumers more money.
“The government should consider reducing personal income tax rates in its next reform campaign, as this would increase disposable incomes and restart the demand cycle,” Bajaj said in a CII statement on Sunday. It was also suggested to increase spending on green infrastructure as well as traditional infrastructure such as roads, railways and ports.
For infrastructure financing, CII proposed to deepen corporate bond markets (including infrastructure bonds), prioritizing a pool of urban municipal bonds, among others.