• More tax sops on anvil to fight slowdown
• 26% FDI cap in defence sector to stay, says govt
• Govt to borrow Rs 46,000 cr more
• Wal-Mart mulls IT outsourcing
• The interim budget to be placed in Parliament next week is expected to be a third stimulus package to boost the economy hit by global economic slowdown. The finance ministry is considering various proposals, including lower excise duties for auto components, automobiles and cement, to spur demand and provide relief to industry and faster refunds of service tax for the exporters. Direct tax front can expect procedural simplifications, 100% tax holiday for IT units under SEZ Act set up under their parent companies, extension of tax holiday for STPIs and EOUs and a hike in depreciation benefits for plant and machinery and commercial vehicles purchase. A tax holiday for production of gas can also be expected (ET)
• According to sources, There is no move at present to change the 26 % cap on FDI in the defence sector. Govt is likely to come out with a revised defence procurement policy next year, improving upon the one unveiled in August last year, which was finalised after feedback from all stakeholders. (BS)
• Govt will resort to an additional borrowing of Rs 46,000 crore between February 20 and March 20 to support the economy, as higher spending and lower revenues stretch its finances. Govt has had discussions with the RBI regarding this and the additional borrowing is likely to happen in four tranches and would not be raised through the private placement route. This would imply that the Government would raise this amount from the market. (BL)
• World’s biggest retailer Wal-Mart is learnt to be evaluating a business process outsourcing (BPO) contract worth around $300-$500 million, as it seeks to outsource non-core processes of procurement, merchandising, finance, accounting and payroll. IBM, TCS, WNS and Wipro are known to be exploring this opportunity. (ET)
