According to the PHDCCI, STT collection for the current fiscal year stood at Rs 40,114 crore between April 1 and December 17.
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During a pre-budget consultation meeting with Finance Minister Nirmala Sitharaman and other officials, representatives from the PHD Chamber of Commerce & Industry (PHDCCI) recommended several key measures, including the abolition of the Securities Transaction Tax (STT).
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On December 30, PHDCCI proposed that with the recent increase in long-term capital gains tax on listed shares from 10% to 12.5%, the long-term capital gains tax on shares is now aligned with that of other assets. Therefore, they argued, STT should be eliminated.
According to the PHDCCI, STT collection for the current fiscal year stood at Rs 40,114 crore between April 1 and December 17.
“This move would ease the tax burden on investors and encourage greater investment in the stock market, ultimately driving economic growth,” stated the industry body.
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Earlier that day, the Ministry of Finance shared on the X platform, “Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman chairs the fifth Pre-Budget Consultation with industry representatives in connection with the forthcoming Union Budget 2025-26, in New Delhi today.”
The other suggested measures are:
* Reduce tax rates for individuals and Limited Liability Partnership (LLP) firms to 25%
* Increase capital expenditure to over Rs 13 lakh crore in 2025-26 from Rs 11.11 lakh crore in the current fiscal
* Expand PLI scheme beyond the 14 sectors to medicinal plants, handicrafts, leather and footwear, gems and jewellery, and the space sectors.
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Key suggestions from ASSOCHAM in pre-Budget meeting:
* Mandate banks to periodically disclose the number and amount of collateral-free loans granted to MSMEs
* Provide an additional allocation or net to enhance credit flow to MSMEs, much like the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) launched during COVID
* Extend scope of presumptive taxation to MSMEs and new age businesses like data centres, data hosting, cloud computing
Key suggestions from FICCI in pre-Budget meeting:
* Increase capex in FY26 by 15 percent over the Rs 11.11 lakh core budgeted in 2024-25
* Rationalise multiple TDS/TCS rates by converging them into a simple two or three-tier rate structure
* Stop imposing TDS/TCS on transactions that are subject to GST since the relevant information is already available through GST filings
* FICCI recommends increasing health sector allocation to 2.5% of GDP by 2025
* Review Priority Sector Lending framework to include climate adaptation, climate risk mitigation activities such as EVs
According to the ministry, senior officials attending the meeting included the Finance Secretary, the Secretary of the Department of Investment and Public Asset Management (DIPAM), and the Secretaries from the Department of Economic Affairs and the Department for Promotion of Industry and Internal Trade (DPIIT). The Chief Economic Adviser to the Government of India also participated.
Last week, Finance Minister Sitharaman chaired the fourth Pre-Budget Consultation with stakeholders and experts from the export, trade, and industry sectors in preparation for the Union Budget 2025-26.
Sitharaman has held several meetings with various stakeholders, including MSMEs, farmers’ associations, and economists.
The Union Budget for the fiscal year 2025-26 is set to be presented on February 1, 2025.
This will be Nirmala Sitharaman’s eighth Union Budget
