Union Budget 2021: The most-spoken phrase before Budget 2021-22– “raise resources without raising taxes” – has now become reality, with the Hon’ble Finance Minister’s delivery of the Union Budget proposals. The thrust of the Government’s revenue augmentation strategy has shifted from the traditional bias towards tax collection to measures such as asset monetisation and disinvestment. The increase in budgeted capital expenditure from 1.9 to 2.5% of GDP, without a corresponding increase in tax rates, is a credit to policymakers. The Government has laudably opted to take a big punt on buoyancy in the economy, which it will attempt to achieve through significant infrastructure spends by asset monetisation.
In the last couple of years, the Government has been rationalising the rates of corporate tax, slashing them to 15% for new manufacturing entities, and 22% for all corporates. These rates are now amongst the lowest across the globe. In doing so, the Government took an important step forward to attract investment and incentivise manufacturing in India. While this was a great move, it did not yield the investor interest in India as expected.
Source: Financial Express
