New Delhi: The Confederation of Indian Industry (CII) on Monday said the government should reduce corporate tax and streamline the Insolvency and Bankruptcy Code (IBC) among other steps to boost the country's economy.
The CII made the recommendations by submitting a 10-point agenda for the new government.
Outlining the key issues which need to be addressed, the industry body also said that the government should expedite the announcement of the new direct tax code.
"Lower corporate tax rate to 25 per cent for enterprises of all sizes. Gradually reduce it further to 18 per cent," a CII statement said, adding that all capital investments across sectors should be provided investment allowances.
For increasing private investment, the CII said that as a significant amount of capital is locked in arbitration, an effective dispute resolution mechanism should be put in place.
"Review IBC 2016 to provide for effective resolution of group insolvency; allow cross-border insolvency; streamline process timelines; enhance judicial infrastructure and balance creditor interest, especially MSMSEs," it said.
The CII also sought rationalisation of the Goods and Services Tax (GST) and asked the government to work towards subsuming petroleum products, natural gas, electricity, alcohol and real estate under GST.
It said the government should reform the GST structure and have only three GST rates.
"Standard or items of mass consumption should converge into a single rate between 12 per cent and 18 per cent; 'demerit' goods should fall in the highest tax category i.e. 28 per cent; while 'merit' goods including items used by the poor should be shifted to 5 per cent or the nil slab."
For agricultural growth, the industry body suggested setting up a council with the Union Agriculture Minister as the Chair and state ministers as members in line with the GST council, for implementation of model acts. It said the government should set up an "ease of doing agri index", to encourage states to adopt agri reforms.
With regards to the issues faced by micro, small and medium enterprises (MSMEs), the CII statement said that all Central ministries should be instructed to clear the pending dues of MSMEs, till date, within a stipulated time.
"Provide facilities to promote zero defect manufacturing and energy efficiency in industry clusters," it added.