Budget falls short on expectation: Parekh

Ahmedabad, Feb 28 (UNI) The Union Budget 2007 overall is steady and emphasises more on social and agriculture development, Zydus Cadilla, Chief Corporate Affairs, Sunil R Parekh here said.

Speaking to UNI he said that industry reaction is mixed as several new taxes and cess has been levied. The industry was expecting scrapping of the dividend tax. Instead the Finance Minister has raised it from 12.5 per cent to 15 per cent.

Also now IT companies would have to pay MAT and the educational cess has been raised from one per cent amouting to three percent, Mr Parekh said. Surcharge of 10 percent on income-tax too has been allowed to remain, he said.

Mr Parekh said when there is a revenue increase of more than Rs 50,000 crore all these taxes could have been removed in order to simply the tax structure.

The next major disappointment is for the auto sector. When India is on the threshold of becoming a nodal hub of auto manufacturing there has been no reduction in excise tariff, Mr Parekh said.

Of course pharma companies are happy about IT rebate on R&D expenditure. So is the textile industries with expansion in textile upgradation fund (TUF), he added.

UNI