New Delhi: The Confederation of Indian Industry (CII) has urged the government to offer tax incentives to companies that save energy and to individuals to encourage them to save and invest more.
"Tax deduction has always stimulated individuals to save or invest more," CII has recommended to the government.
"We recommended that tax incentives should be given for investing in companies engaged in generation of renewable energy or such other businesses resulting in water efficiency and carbon emission reduction," it said in a statement.
In this connection, CII asked the government to encourage low-emission and fuel-efficient cars and offer a higher rate of depreciation to buyers.
"This would also result in higher cash flow to these industries. The benefits could be given by way of tax deduction or reduced rate of capital gain on transfer of shares in these companies."
CII`s recommendations come ahead of the annual budget next month.
The chamber also advocated extending tax holidays to companies engaged in the manufacture of advanced energy efficient products and equipment used in solar, wind and other environment friendly resources, apart from tax credits to encourage firms to invest in ground water use.