The High Level Committee on Corporate Social Responsibility (CSR) has recommended making CSR expenditure tax deductible and that compliance violations be treated as a civil offence that attracts penalties.
Corporate Affairs Secretary Injeti Srinivas on Tuesday presented the report to Finance Minister Nirmala Sitharaman.
The main recommendations include making CSR expenditure tax deductible, allowing the carry-forward of unspent balance for a period of 3-5 years, and aligning Schedule 7 of the Companies Act (which outlines the kinds of activities that qualify as CSR) with the United Nations Sustainable Development Goals, the government said in a release.
“The Committee has also recommended that companies having CSR-prescribed amount below ₹50 lakh may be exempted from constituting a CSR Committee,” the release added. “The Committee has also recommended that violation of CSR compliance may be made a civil offence and shifted to the penalty regime.”
Balancing priorities
The report also recommends balancing local area preferences with national priorities when it comes to CSR, and also introducing impact assessment studies for CSR obligations of ₹5 crore or more.
It also recommends the registration of implementation agencies on the Ministry of Corporate Affairs portal.
