Rising Budget Expectations and Way Ahead from Sachin Karpe
Weighing such expectations can be a daunting task. A lot will need to be amended, beginning with tax slabs, rate change and new policy announcements.
Weighing such expectations can be a daunting task. A lot will need to be amended, beginning with tax slabs, rate change and new policy announcements. Doing this can be time consuming and touch. Ideally this budget should more focus on revenue, expenses and reducing deficit that has dented the economy big time. Financial position has gone for a toss, draining resources.
As rightly reported by Times of India, That story is mired in a mess. There are businesses that cannot be set up because there are too many rules; there are businesses that cannot run profitably because costs are too high; and, there are businesses that cannot sustain since they cannot procure or sell what they need via a reasonably predictable process. This is true for a large number of businesses -manufacturing, services and agriculture. Freeing them from this burden might not fill the government's coffers, but it will help in other ways.
Sachin Karpe takes a look at how the budget looks like does. The easiest area to deal with is tax evasion. Government can take measures to come down strongly upon those who evade taxes. This seems easier than other areas. Working efficiently, removing bottlenecks can help government earn a substantial amount of revenues.
Direct tax code and Goods and services tax, can provide a stark plan ahead. Sachin Karpe has always advocated reduction of subsidies, at least to the elite class. Some correction in food, oil, LPG and fertilizer subsidy will bring a great deal of panacea to the deficit issue. Threats of poor monsoon, rising global oil prices are hovering over and posing danger of inflation. This is a politically sensitive area as it involved vote banks, therefore, will need a lot of attention.
Disinvestment looks like a good step. Offloading some stake from Government run entities, which are already doing well, can help government bring a lot of money. Good performance has shot up the valuation of these companies, raising the scope even higher. It shouldn’t be a difficult task to get foreign investors to buy stakes. A robust tax regime will have to be built keeping in mind a long term view.
Budding sectors like manufacturing and infrastructure need a much needed boost. A simple strategy and not a restricted manner for doing business with global conglomerates will help government garner a lot of public confidence, feels Sachin Karpe.
Know more about Mr. Sachin Karpe at http://sachinkarpe.co.in and his blog post at http://karpesachin.info/