Despite differences over the dividend tax, the Rajnath Singh committee is expected to endorse the Kelkar committee recommendation for exempting companies and shareholders from paying tax on dividends.
Singh is believed to have prevailed upon his committee members to arrive at a consensus on vital issues and also favoured the proposal to phase out exemption on the information technology industry.
But the panel will be pressing for the restoration of the housing loan exemption limit.
Like in the past, the political acceptability to the Kelkar committee report on tax reforms remained elusive because members of the Rajnath Singh committee persisted with their conflicting perceptions.
Issues related to the dividend tax, exemption to infotech sector and infrastructure projects emerged as major contentious areas of discussion.
That the Bharatiya Janata Party's economic thinking is divided on two distinct lines was evident by positions taken by party economic wing chief P N Vijay and his predecessor Jagdish Shettigar.
Vijay favoured extension of the dividend tax exemption to shareholders and companies. Vijay's plea was in conformity with the Kelkar Committee recommendation which suggested exemption to companies and shareholders to give buoyancy to the capital market.
Another committee member Kirit Somaiya is al's believed to have supported Vijay's views.
But it was objected to by Shettigar who felt it would dry the revenue source for the government. Similarly, a section of members also objected to the proposal to phase out exemptions to the infotech sector.
"This is intended to curb the growth of new software companies and benefit established firms," said a member of the committee.
According to party sources, a majority view favoured phasing out of exemptions in all those sectors which were not linked to the development of infrastructure.
"This exemption should be linked to incentives for the growth of the core sector," said a senior member of the committee.