Financial sector players on Monday demanded a reduction of GST on term insurance to increase its penetration and the streamlining of KYC norms for better financial inclusion.

In a pre-budget meeting with finance minister Nirmala Sitharaman, representatives of the financial sector and the capital markets also highlighted the need for governance changes in public sector banks with special focus on the recommendations of the P.J. Nayak committee.

Finance secretary Rajiv Kumar said after the meeting, “There were taxation suggestions. We have taken note of it. Taxation concern would be addressed in the given fiscal space. Inflation is still benign, credit growth is also happening. All these factors will be kept in mind.”

There were also suggestions on enhancing the credit offtake from banks, governance, risk capital issues, improving functioning and alleviating stress among NBFCs.

Mobile sops

IT hardware and mobile manufacturers sought clarity over the recent reduction in export incentives and demanded rationalisation of the tax structure, including the GST rate on handsets, during a pre-budget meet with Sitharaman.

According to the India Cellular and Electronics Association, reduction in export sops will lead to huge job losses.

A 15 per cent corporate tax rate for services companies in SEZs, setting up a fund for deep-tech start-ups and establishing clusters to demonstrate design-to-manufacturing capabilities of tech firms were some of the key demands of the IT sector at the pre-budget consultation.