S Subramaniam, chief financial officer of Titan Company, expects reduced corporate tax (announced last year) to kick in from FY17.
"Finance Minister had promised income tax rationalisation in next three years, I am hoping some of that start kicking in this financial year," Mr Subramaniam told NDTV Profit. (Watch)
Finance Minister Arun Jaitley had proposed to reduce the corporate income tax to 25 per cent from 30 per cent over next four years in 2015.
Subramaniam also made a case for reduction in gold import duty in the upcoming budget.
"Customs duty at 10 per cent is very high and encourages smuggling of gold," Mr Subramaniam said.
Import duty on gold has been constant at 10 per cent since August 2013, when the government increased the import duty from 4 per cent to 10 per cent in three back-to-back revisions to curtail the burgeoning current account deficit.
The 10 per cent import duty on gold has led to increase in the difference in domestic prices and international prices, encouraging smuggling, analysts say.
Mr Subramaniam said retail jewellery sales have been muted since the beginning of the year as customers are postponing their purchase on expectation of customs duty reduction in the upcoming budget. "Customers expect gold prices to soften with the customs duty reduction being thought on February 29 budget," he said.
However, Titan expects gold sales to pick up in March. "We expect resumption of buying if government does not reduce customs duty as gold price is inching up. Hoping that March should be better than what we have seen so far," Mr Subramaniam said.
Domestic gold prices have increased nearly 16 per cent in this year so far from nearly Rs 25,000 per 10 grams to Rs 29,000 per 10 grams. Titan expects the increase in gold price to have a positive impact on its sales going ahead.
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