The Rajnath Singh committee has made 21 specific comments and suggestions in its report on the Kelkar recommendations.

It has said the tax exemption limit be raised to Rs 100,000, the standard deduction and exemptions on small savings be retained, and the taxes on dividend distribution and long-term capital gains be eliminated.

According to committee sources, the imposition of a cess on petrol and diesel, which would aid infrastructure development, has also found favour with the committee.

The committee has, however, not recommended any tax slabs for personal income and has also refrained from commenting on the minimum alternate tax.

The sources said the finance minister had been provided sufficient elbow room to draw up tax proposals for the Budget.

"We have touched upon only those aspects that directly affect the people. We have, however, said sops for the infrastructure companies be retained to promote growth," said a member.

The taxing of farm income has come under fire by the Rajnath Singh committee, which has instead suggested sprucing up the tax administration to check evasion by non-farmers who show high farm income.

It also recommended that the exemptions on repayment of educational loans and those for senior citizens be retained, the sources said.

So far as indirect taxes are concerned, the Rajnath Singh committee has seconded Kelkar's recommendations.

It has noted that while the classification of imports into two categories -- raw materials and finished goods -- is fine for levying Customs duty, there is a strong case for drawing up a list of merit and demerit goods.

The government should retain the flexibility of promoting and discouraging certain imports.

“For example, when there is a shortage of onions, the government should be able to free onion imports. Similarly, when there is a surfeit of some commodity, the government should be able to curb its large-scale import,” said a member of the panel.

Sources in the committee also said it had not made any specific recommendations on the corporate tax structure for domestic or foreign companies.

The committee will present its report to the finance minister on Thursday before making it public.