(Rptg yesterday's DI 13 for Chennai and all needing)

New Delhi, Nov 8 (UNI) With the clock ticking for the presentation of Budget 2007-08, Finance Minister P Chidambaram yesterday favoured further moderation in tax rates and disapproved of tax concessions.

''There is scope for further moderation, however, this will depend upon greater tax compliance. The test is the secular rise in the tax to GDP ratio'', Mr Chidambaram said in his address to the annual Economic Editors Conference.

The address was followed by the customary Question- Answer session, with many queries from the large number of Press persons from the states who were participating in the Conference.

''So long as we are not able to eliminate wasteful expenditure, we have to adopt a cautious attitude towards tax concessions and revenue sacrifices'', he said.

Mr Chidambaram said while sectoral policies aimed at giving a thrust to the sector concerned were necessary and desirable policies should rely more on better infrastructure and new technology.

''The magnate for new investment should be better infrastructure and not tax concessions alone'', he said.

Mr Chidambaram said the attitude of assessees towards taxes has undergone a ''remarkable change.'' Both Corporates and individuals have imbibed the principle that ''honesty is the best policy''.

''There are still many who evade or avoid taxes, but a large proportion is willing to pay the taxes that are due and lead to a life of dignity and peace'', he said.

Mr Chidambaram said the attitudinal change was the result of moderation and stable tax rates.

The Finance Minister painted a picture of an economy which was glowing-sustained high GDP rates, low rate of inflation, bengin interest rates, stable exchange rate, robust growth of exports, structural shifts in the economy, resurgence in industrial growth rate and buoyancy in the growth rate of manufacturing as well as fiscal prudence.

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