NEW DELHI: The Confederation of Indian Industry (CII) has made significant recommendations for the upcoming Budget 2025-26, urging the government to lower the excise duty on fuel as a means to stimulate consumption, particularly among lower-income groups. The industry body argues that current fuel prices are a significant driver of inflation, which consequently affects the purchasing power of consumers.

CII suggests that the government may also consider reducing the marginal tax rates for personal income for individuals earning up to Rs 20 lakh per annum. “This would help trigger the virtuous cycle of consumption, higher growth, and higher tax revenue," CII stated, highlighting the stark contrast between the highest marginal rate for individuals—currently set at 42.74 percent—and the corporate tax rate of 25.17 percent.

The recommendations come as consumers face increasing inflation that has decreased their spending power. "The effects of inflation have hit lower and middle-income earners the hardest," said CII's Director General Chandrajit Banerjee. He emphasized that measures focused on enhancing disposable income are essential to sustain the economic momentum.

Furthermore, CII advocates for targeted government interventions aimed at low-income groups, which could include consumption vouchers designed to stimulate demand for specific goods and services. These vouchers could be allocated to Jan-Dhan account holders not enrolled in other welfare programs, potentially enhancing overall economic activity.

For a more detailed overview of CII's proposals, refer to the original articles on Times of India (1) and Times of India (2).