New Delhi: Following are the highlights of the Kelkar panel reports on Direct and Indirect tax reforms.

Direct Tax:
• Income Tax limits should be hiked to Rs 1 lakh from Rs 50,000.
• Two slabs of 20 per cent for income Rs 1-4 lakh and 30 per cent beyond Rs four lakh proposed.
• Two slabs of 20 per cent for income Rs 1-4 lakh and 30 per cent beyond Rs four lakh proposed.
• Additional tax reliefs for senior citizens and widows and doubling of exemption under 80ccc.
• Standard Deduction should be eliminated.
• Surcharge should be removed.
• Interest payment upto Rs 50,000 on home loans should be exempted and interest subsidy offered.
• Income tax on agriculture.
• Corporate tax should be 30 per cent
• Elimination of tax incentive under section 10A, 10B of I-T Act.
• Lifting of dividend tax and capital gains tax.
• Depreciation rate should be reduced to 15 per cent from 25 per cent.
  
  

Indirect Tax:
• Customs duties should be reduced to 10 per cent for raw materials, inputs and intermediate goods and to 20 per cent for consumer durables by 2004-05
• Customs duty for coal, ores and other raw material should be reduced to five per cent, capital goods, basic chemicals to eight per cent by 2006-07.
• Custom duty on crude oil should be reduced to eight per cent and 15 per cent for petroleum products by 2003-04 and further to five and 10 per cent respectively by 2004-05.
• Higher duty of 150 per cent for specified agri products and demerit goods.
• Complete exemption of customs on life saving drugs, equipments, defence related goods and imports by RBI.
• All exemptions should be removed except for life saving goods, security items, relief and charitable goods and international obligations.
• Excise Duty should be 14 per cent for most items, 20 per cent for motor vehicles, airconditioners and aerated water.
• Excise on processed foods products should be reduced to 6 per cent while exempting life saving drugs, security items, and agri products.
• Excise on petroleum products should be fixed after quarterly reviews.
• Central Excise Duty on kerosene should be raised by Rs one per litre.
• Uniform Duty of 16 per cent for textile fibre and yarn, which should be reduced to 14 per cent by 2004-05, 12 per cent duty on all fabric till 2004-05.
• Duty exemption for SSIs with turnover upto Rs 50 lakh.
• Nationwide Value Added Tax and a comprehensive Service Tax from April 2003.
  
  

PTI