Finance Minister Arun Jaitley will present Interim Budget 2019 on February 1.
Various entities, from corporates and analysts to economists and lobbyist, will watch Budget announcements closely for any changes in rules pertaining to infrastructure sector.
Industry body Ficci has said thata reduction in basic customs duty applicable to rope-propelled transport solutions for urban transport will benefit sector.Here are some of expectations for infrastructure sector listed out by industry body Ficci:Allow benefit of claim of depreciation in case of metro rail systemsThe Central Board of Direct Taxes (CBDT) (Circular No.9/2014 dated 23rd April, 2014) clarifies that expenditure incurred on development and maintenance of infrastructure projects like roads/highways on a built-operate-transfer (B-O-T) basis under a concession arrangement may be amortised over period of concession and claimed as allowable business expenditure as per provisions of Income Tax Act.
The above circular is applicable only to infrastructure projects for development of road/highways on BOT basis where ownership is not vested with assesse under concession arrangement.
It is requested that benefit of claiming depreciation over period of concession under provisions of Income Tax Act on cost incurred on construction, operation and maintenance of metro rail systems developed under a concession arrangement on a design, build, finance, operate and transfer (DBFOT) basis be also allowed similar road/highway projects.Customs duty on rope propelled transport solutions for urban transport be made at 5 per centIn general, basic customs duty applicable to rope propelled transport solutions is 10 per cent.
Further, basic customs duty applicable for rope propelled transport solutions for tourism is 5 per cent (under rules of Department of Tourism).
Rope-propelled urban transport solutions have an application in several government initiatives such as new Metro Policy 2017, Smart City Projects, Last Mile Connectivity, Mass Rapid Transit Systems (MRTS) for non-metro towns in country etc.
It is a solution to reduce congestion and pollution for urban scenario.A reduction in basic customs duty to 5 per cent will benefit all these sectors.
It is accordingly recommended that basic customs duty for rope propelled transport solutions for urban transport should also be reduced to 5 per cent.