The Confederation of Indian Industries has asked the government not to increase excise duty and service tax in the upcoming union budget for 2012-13 in view of the continuing industrial slowdown.
"There is a strong need for retaining the current rates of excise and service tax to spur industrial investment," CII said in its pre-budget memorandum to the government submitted on Sunday.
The industry chamber has recommended a continuation of the current 10 per cent standard rate of excise duty in the next financial year.
Industrialists fear that the government may raise the level of these taxes to cover its burgeoning fiscal deficit, as it presses ahead with subsidies and social schemes that are almost in defiance of economic logic.
"In the wake of deteriorating fiscal health of the government ... announce initiatives that can accelerate the pace of private investments," CII said.
The industrial chamber also stressed the need for identifying and fast-tracking at least 100 mega projects in the manufacturing and infrastructure sectors.