Union Finance Minister Arun Jaitley will be tabling the budget for 2018-19 financial year in Parliament tomorrow. What are the expectations of players in various sectors?
Swarajya brings to you the expectations of a few of them:
Entrepreneurs’ Organisation (South Asia) finance director Ajay Agarwal
“Our request to the Hon’ble Finance Minister would be to reduce the corporate tax rate to 20% as done by US and many of the other countries. To reduce some kind of incentive or tax break for exporters given tough situation faced because of implementation of GST and delay in refunds. Relook at divided tax as dividend is already been taxed twice. (1) When company earns profit. (2) When the company issues dividend for pay 20% dividend tax. Now at the hand of the recipient where again recipient pays tax on divided received above Rs 10 lakhs. It is not fair that the same income be taxed three times.”
WittyFeed co-founder and CEO Vinay Singhal
"We are very keen about 2018 budget and are looking forward to the Budget 2018. As entrepreneurs, ours is a dual expectation from government - support for entrepreneurial initiatives and a favorable tax regime. The massive changes in the economy in last few years like demonetisation and GST implementation should begin to reflect their effects from this financial year onwards. Rationalization of corporate taxes is a big expectation from this budget; paring down of corporate tax to 25-28%. The tax cuts would help entrepreneurs manage the challenges arising out of changes made by other administrations around the world, especially US. We foresee continued support from the government for entrepreneurial innovations through simplified rules and ease of implementation.”
AxisRooms CEO Anil Kumar Prasanna
“We all agree that the cost of doing business in the hospitality industry is capital intensive and it creates a tremendous amount of jobs locally. Out of the 40.3 million jobs created in 2016, the tourism industry contributed a whopping 9.3%.
“Our country is incredibly unique for the global traveler. We are diverse in culture, heritage, beaches, hills, backwaters, Ayurveda, medical tourism etc. But we are ranked 40th in terms of the number of arrivals we receive. This doesn't reflect our potential at all.
“I think, one major (recent) impact affecting the industry is the GST rate. We hope that the upcoming budget considers a single slab below 12%. You see, countries such as Singapore, Thailand, and Japan have encouraging tax brackets between 5 and 10%. Also, on the administration and a strategic part, we could be more flexible with VISA-ON-ARRIVAL extensions and also should bring in more countries under this bracket.
“In 2016, our industry generated nearly USD 208 billion. However, the tourism industry is overlooked during national budget allocations. In order to boost the industry, we need to see a bolder commitment in terms of resource allocation.
“We should also expect start-up funds and R&D grants which are usually dedicated towards the IT industry can be set up for the tourism industry to boost indigenous product and service innovation. I sincerely hope that the upcoming budget has something inspiring and worthwhile for the industry.”
Cygnett Hotels & Resort founder and managing director Sarbendra Sarkar
“With the upcoming Union Budget for 2018-19, we can assume that this budget can be a big push towards increasing the digitization with high-tech solutions. Also, we are looking forward to reforms supporting the industry. While the government is aggressively marketing brand India globally, it is imperative to focus towards infrastructure, digital infrastructure, the speed of clearances of hotel projects will have a positive impact on our business. Liquor license policies need to be simplified for the star category hotels to attract more tourists.
“As a Hotelier, we wish for a simplified regulatory environment that can attract additional investment. Competition among investors will help New Hoteliers to have more control over the terms of the contract and continuously spur the innovation economy. Further, hoteliers hope for tax holiday in the underdevelopment tourism area like Northeast. Lastly, we expect some GST further reduced for budget hotels.
AscentHR CEO Subramanyam S
Finance Minister Arun Jaitley should focus on:
· Tax reforms and their effects: Work towards addressing the challenges faced during structural reforms like GST and an impulsive reform like demonetization and make sure the economy experiences the results of the exercise by way of increase in tax base, tax compliance and moving towards a cashless economy. The negativity prevalent in early stages of implementation has waned and it is a good time to make sure the reforms are fully adopted by businesses and people. Towards this end any ease of compliance and lower tax slabs where appropriate would be a great accelerator.
· Job Growth: While the government must accelerate labour reforms, imposing a huge burden on the employer alone does not add value to the cause and a more balanced approach should be adopted. Without an active participation from Industry, job growth is a myth. Continuing cost escalations and a hugely competitive neighbour in manufacturing cannot be mitigated by sloganeering of Make in India but needs a very pragmatic approach similar the ones adopted in India earlier plans of incentivizing industry or services to spread to non-urban sectors coupled with support on Infrastructure, power etc… This would decongest cities and improve employment opportunities both in core sectors as well as the ones from the industrialization of such sectors.
· Education reforms: Employability has been a major concern over the last decade and any amount of money spent on skilling by the government is not bringing out the desired results. The government must encourage vocational training/skilling as part of the curriculum in schools/universities and encourage voluntary adoption of such practices by private entrepreneurs which can create a pool of employable talent. The growing earnings in a family have already rendered dual employment a lesser necessity and should not lead to a jobless population.
· Pension and Insurance: India must embrace pension reforms fully and the government has to push the pension reforms not just for the organized sector but also for the unorganized ones. In addition, making insurance a requirement, but not as an investment option, should be encouraged given the large population and the vagaries of the economy, health and lifestyles.