345 வாரத்திற்கு முன்பு — 8 நிமிடம் படிக்க
The Union Budget for 2018 will be especially important this year as it will be the first budget after GST roll out and the final budget presented by this government before the Lok Sabha 2019 elections. In the last year and a half, the nation’s way of conducting commerce underwent major changes with the introduction of GST, and prior to that, there was demonetisation at the end of 2016, the impact of which was arguably felt through 2017. SMEs can expect that the budget may make it easier to obtain and pay back loans. Also, there is likely to be continued focus on Make in India, Startup India and Skill India initiatives that will have a direct impact on the SME sector. Lastly, the Ease of Doing Business ranking, as measured by the World Bank, ranked India a 100 on a list of nations worldwide. This is an improvement of 30-40 places over the last few years. The government should continue its efforts to make India an attractive place to do business and SMEs will be beneficiaries of these efforts.
GlobalLinker members share their thoughts on the upcoming budget. Specifically, we asked members what their expectations were from the budget and what they believed the government could be doing to boost entrepreneurship.
Sambhav Karnawat - Founder, Jewelove
Budget expectations
I expect this budget to bring more clarity into the Indian financial and taxation system. I expect corporate taxes to be lowered and personal tax slabs to be relaxed further. There is also a dire need for the government to bring definitive clarity to issues concerning startups such as Angel Tax.
Boosting entrepreneurship
I believe the two biggest steps the government can take, are widening the definition of startups and the eligibility criteria for tax relief to include startups formed before 1 April 2016, making it easier for small businesses and companies to do business. For instance, making access to Mudra Loans easier, increasing tenures for Mudra Loans and incentivising companies to hire by providing tax benefits.
Sharmila Vali - Managing Director & Founder, Revyur Speciality Naturals
Budget expectations
The budget 2018 should focus on the rural infrastructure and industrial sectors. India being a more than 70% agriculturally driven country, it is an important sector and farmers livelihoods should be a key concern. Promotion of industrialisation should be key to India's growth in the next fiscal year. A lowering of income taxes and corporate taxes can create entrepreneurship leading to employment. Recapitisation and corporate taxes cuts should be pursued. The budget should try to boost consumption by also giving tax breaks to the individual consumer, leading to increased spending power.
Boosting entrepreneurship
Focusing on investments, getting government funds under the minimum scheme, tax cuts based on the size of the industry and easy loan disbursements with less constraints can all bear fruit. Women entrepreneurship should be a major focus, with tax cuts and benefits sanctioned up to a certain fiscal limit.
Milan Vaishnav - Consultant Technical Analyst, Gemstone Equity Research & Advisory Services
Budget expectations
This budget, just like any other budget, will be a tight rope walk for the Finance Minister between populist measures and economic and fiscal prudence.
1. Among other things, we expect the Finance Minister to address the LTCG (Long Term Capital Gains) issue. There is conjecture that LTCG may be introduced. However, we expect that rather than introducing Long Term Capital Gains, the Finance Minister may increase the one year holding requirement to two years for being eligible for LTCG exemption rather than introducing LTCG all over again.
2. I also expect focus on the rural economy. Increased budgetary allocation in the infrastructure development in rural areas is likely to increase along with overall efforts to boost consumption in the rural areas.
3. I also expect that ‘infrastructure’ status will be accorded to the defence sector. As of now, hardly 15-17% of India's military equipment is state-of-the-art; whereas, over 50% is obsolete. Along with according ‘Infrastructure’ status to defence, 100% FDI should be permitted and the present 15% deduction for investment in new plant and machinery which is available for all sectors until March 2017, should be extended to aerospace and defence as well.
4. Further, if we look at Oil & Gas space, the present Minimum Alternate Tax (MAT) of 20% of book profit for exploration and production is acting as a deterrent for investment. Keeping in view the government's mission of ‘24x7 power for all’ the Finance Minsiter may consider tinkering with this MAT rate a little bit.
Boosting entrepreneurship
It is beyond a doubt that this country has tremendous potential to build an excellent ‘startup’ environment that can enable millions of talented entrepreneurs to succeed. Apart from building a great startup ecosystem, incentives are required to help startups get relatively easy access to finance. Apart from this, all businesses, big or small, established or startups should be encouraged to spend on Artificial Intelligence (AI) and Big Data. Some fiscal stimuli and incentives to encourage investment in AI and Big Data should be considered.
Shriyans Bhandari - CEO Greensole & Director Heritage Girls School
Budget expectations
I expect the income tax to be reduced or done away with as GST is in place which was preceded by demonetization. This would help in gaining positive sentiment of the citizens and would also boost economy. In terms of revenue, it would not be a major loss to the government as less than 10% of the people pay taxes. Emphasis should be given to our industries rather than spending on monuments and bullet trains.
Boosting entrepreneurship
Government should increase the number of incubators in the country and also make the laws related to starting a venture simpler to understand. The government has done well in setting up national awards for entrepreneurship and in allocating a INR 10,000 crore budget for encouraging young entrepreneurs but a lot still needs to be done to create a favourable startup environment.
Mittesh Gaiwala - Director & Creative Head, Greenlands
Budget expectations
I expect the rate of products to be fixed in lesser slabs in GST. I think there should be a flat rate for major products with daily needs goods and services such as rent fixed at 12%. The government also needs to increase income tax exemption limits. ‘Housing for all' has been at the top of the agenda of the government. They should work towards providing housing facilities to the lower middle class and work towards raising the standard of living.
Boosting entrepreneurship
The government is easing the process to start business in India. However, they can help individual or first time entrepreneurs by giving a lower rate of interest to start their ventures.
Network with SMEs mentioned in this article by clicking on the 'Invite' button on their profile. Mittesh Gaiwala, Shriyans Bhandari, Milan Vaishnav, Sharmila Vali, Sambhav Karnawat
Disclaimer: The views and opinions expressed in this article are those of the SMEs interviewed and do not necessarily reflect the views, official policy or position of GlobalLinker.
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