- It is that time of the year where every single citizen of the country will be eagerly anticipating how he or she will be affected in terms of monetary gains/losses on the backdrop of the annual Budget announced by the Union Finance Minister. This year though is anything, but normal as extraordinary circumstances created by the global pandemic will loom large on the planned fiscal policy decisions. Each single measure will be thoroughly debated, questions raised, advice offered on hindsight, and lamented/appreciated/welcomed suiting individual perspectives. One aspect is for sure that there won’t be a consensus or singularly agreeable opinion on the matter.
PC: HEMANT SINGH
- As such, Finance Minister Nirmala Sitharaman would be keenly watched as she unravels the fiscal policies, budgetary allocations, and envisaged plans to restore the economy on the track battered so debilitatingly by the vagaries wrought by the pandemic induced lockdowns. Effects of the stringent measures are still being felt across diverse sectors as efforts to revert to pre-pandemic days appear cumbersome and fraught with tremendous challenges. India as a country finds itself at crossroads vis-à-vis the most challenging economic environment in the last three decades. Thus, Budgetary presentation assumes such significant importance now.
- To add to the economic challenges, the China conundrum in eastern Ladakh has come at the worst possible time wherein considerable resources are being expended in line with the urgent but necessary defence acquisitions to thwart the enemy misadventures. Never a strength of our economy, direct taxation is yet to set the stage for evoking cheer as we find ourselves in the early stages of big changes initiated in late 2019 to align India’s corporate tax rate to East Asian levels. By sustaining the same, there’s a case to enhance standard deduction to provide honest taxpayers some relief in an extremely harsh environment easing the burden on individuals.
PC: fifarma
- Time and again it is emphasized the imperativeness to use fiscal incentives to boost India’s pool of long-term savings that are essential to build infrastructure, the prerequisite for a competitive economy to thrive as well as make a compelling case for laying further thrust in sprucing up. Carefully designed tax breaks can significantly increase the pool of domestic long-term savings minimizing the financial sector risks existing today because of a mismatch in the duration of deposits and their subsequent investment. Further, the Prime Minister’s vocal for local call and Atmanirbhar Bharat Abhiyan should be fueled by adequate support in the Budgetary allocations.
- One of the saving graces in the fiscal handling ever since the pandemic struck the nation is the government does not have a serious problem on the expenditure front as the same is well controlled. Contrarily, the revenue generation has taken a hit by shrinking due to the lockdowns. Therefore, it is incumbent to spend more judiciously in selected areas to fasten the economic growth. Majorly acting on cutting back unrewarding subsidies to make room for more expenditures is unavoidable. Focusing on growth will create opportunities for the millions entering the job market generating precious revenues. Piling on more taxes on the hapless taxpayer should firmly be desisted at all cost. The anxious wait continues till the Budget is revealed on 01st February 2021.
