LESSER TAX FOR CLEANER INDIA.
Budget could provide tax relief to firms for investment in Swachh Bharat & Clean Ganga
LESSER U NION finance minister Arun Jaitley is likely to provide tax concessions in the forthcoming Budget to attract corporate funds for the Swachh Bharat Abhiyan and Clean Ganga campaign.
Jaitley is considering a proposal on tax incentives for these two major schemes, a senior official confirmed.
India Inc has submitted as part of its wish- list that the funds it allocates under the mandatory corporate social responsibility ( CSR) be allowed as a deduction or weighted deduction in computing their tax liability. Currently, any contribution to the Prime Minister's National Relief Fund is exempted from tax.
Under the Companies Act, companies are required to spend two per cent of their net profit on CSR. The norm is applicable to companies having, at least, ` 5 crore net profit, or ` 1,000 crore turnover or ` 500 crore net worth. Livelihood enhancement and rural development projects, working towards protection of national heritage, setting up public libraries, promotion and development of traditional arts and handicrafts, are among the activities coming under CSR ambit.
The Income Tax Act does not provide for any incentives for such expenditure. The new proposal relates to providing a tax concession for the portion of CSR funds allocated for Swachh Bharat and Clean Ganga campaigns.
Swach Bharat Kosh has been set up to attract funds from various entities, including corporates, for activities related to the Clean India initiative. The Clean Ganga Fund is aimed at pooling money for taking up works to clean the Ganga.
Swachh Bharat and Clean
Ganga are among the major initiatives of the Modi government, which has embarked on a major drive to ensure cleanliness across the country.
Meanwhile, the Fertilizer Association of India ( FAI) has written to Jaitley seeking arrangement of funds to clear outstanding subsidy arrears which are likely to cross ` 40,000 crore by March- end.
FAI director general Satish Chander wrote that urea manufacturers have not been paid since August 2014. Therefore, a number of plants have resorted to shut down.
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