Lifting the Economy

In view of slowing economic growth, cautious lending environment and rising unemployment in the country, there’s a need for the government to improve the credit environment, increase disposable income and give a stimulus to key employment-generating industries such as auto and infrastructure. This could help India ride the economic situation and perhaps propel its growth.

With precisely calculated tax policies and incentives in the Union Budget, Finance Minister Nirmala Sitharaman can provide corporates and individuals with the required leeway to spur investment, demand and consumption. In this context, corporate India has some key expectations from Budget 2019.

Rationalisation of tax rates: On the individual tax front, tweaking the slab rates and surcharge may provide more disposable income in the hands of consumers. Reduction of the corporate tax rate to 25 per cent across all industries would bring parity and provide a level-playing field for all taxpayers.

Many industries pay taxes under Minimum Alternate Tax (MAT) provisions and this is almost like a cost because they are unable to utilise the MAT credit for various reasons. At present, the MAT rate is almost 20 per cent. Bringing it down even marginally will give a psychological boost to industry, especially the IT and ITeS sector.

Source: The Hindu BusinessLine

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