The increase in the rate of withholding tax from 10% to 25% for non-residents would send negative signals to diaspora investors, the Federation of Indian Chamber of Commerce and Industry (FICCI) said on Friday.
During a post-budget discussion, FICCI panelists urged the government to reconsider its decision to increase the rate of withholding tax.
S Ramakrishnan, Commissioner of Income Tax, described the Budget as good, claiming it has a number of good specifics to get investments going again with a good push.
V Ranganathan, Partner - Tax, E & Y said that it has been a promising Budget with 10 years under single prime minister. The years ahead may not be very stable, he quipped.
Shakuntala, Chief Commissioner of Central Excise and Service Tax, highlighted the exemption of tax withdrawn on restaurants having facility of air conditioning or centralised air heating.
Mala Srivastava, Chief Commissioner of Customs, Tamil Nadu said the basic customs rate remains the same and reduction of 5% from 7.5% on textile machinery will make it affordable for manufacturers.