Financial Daily from THE HINDU group of publications
Tuesday, Mar 08, 2005
Financial Daily from THE HINDU group of publications Tuesday, Mar 08, 2005 |
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Industry & Economy
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Income Tax Soften burden of fringe benefit tax: ICAI Our Bureau
New Delhi , March 7 CHARTERED accountants on Monday urged the Finance Ministry to soften the burden of the proposed fringe benefit tax (FBT) regime on small employers. The members of the Institute of Chartered Accountants of India (ICAI) made this representation at a post-Budget workshop that was attended by senior officials of the Finance Ministry. The officials asked the ICAI to come up with detailed recommendations on the aspect of fine-tuning the proposed FBT regime. Some of the ICAI members suggested that the Finance Ministry could look at the possibility of having some form of a threshold limit for the applicability of the proposed FBT regime on companies, firms, etc. It was pointed out that small employers would find it extremely difficult to comply with the proposed provisions. At the same time, Mr Ved Jain, Chairman of the ICAI's Fiscal Laws committee, held that the institute was in agreement with the Revenue Department's general philosophy that no income should go untaxed. He, however, held that the principle of equity could be incorporated in the FBT provisions. Besides suggesting rationalisation of the mode of computation of various fringe benefits, the institute has now promised to recommend detailed mechanism and methodology for the same. It also held that payments that could clearly be attributed to the employees should be taxed directly in the hands of the employees and only those expenditure or payments of a collective nature coming within the scope of the fringe benefit tax may be taxed in the hands of the employer.
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