SAYS Raghuraman: "The general lowering of tax rates has led to better tax compliance and the Government has realised more than the targeted revenue in the fiscal year 1995-96." Mitra wants corporate taxes to be reduced to 35 per cent and stabilised at 30 per cent over the next two to three years to bring it in line with rates in other countries.
A BJP or Congress government could possibly do that sometime in the future, and balance that with the proviso that all pro-fit-making companies will have to pay some minimum taxes. No zero-tax companies is what the BJP manifesto promises, but this means abolishing concessions like tax exemptions for setting up plants in backward areas and so on. Which will require a great deal of political will.
An NF-LF government will certainly raise taxes, and try to widen the tax base and enforce greater tax compliance. Surjeet wants a step-up of government expenditure on social and physical infrastructure, to be financed by enhanced direct tax collections. This is in contrast to the BJP, which believes that taxation alone cannot be the base for revenues.