On a scale of 1-10, how would you rate the Budget ?
Ruchi Negi : 7
Shubham Choudhary : 6.5
Yash Vashisht : 8
Shreyas Kulkarni : 8
What is the Budget’s big idea?
Ruchi Negi : The Budget is focused on getting India digitalised, with more importance given to the rural, poor and youth.
Shubham Choudhary : It seemed quite planned , and followed NDA’s step-by-step approach. While the first two Budgets were focussed on corporate growth and rural growth respectively, this one turned its attention on digitising the Indian economy and providing relief to the rural sector and the middle class.
Yash Vashisht : The theme of this year’s Budget was TEC (transform, energise and clean) India. Also, in view of the slow private investment amidst weak global sentiments and demonetisation, there was a need for higher public expenditure. And the government has done quite well by increasing its expenditure targets.
Shreyas Kulkarni : It had two main ideas: to transform, energize and clean Indian economy. And stimulate growth and relief to middle class.
Where has the Finance Minister scored?
Ruchi Negi : Tax slab reduction from 10 per cent to 5 per cent, leading to ₹12,500 tax benefit to each individual; legislative intervention to confiscate assets of economic defaulters who flee abroad; withdrawal of service charge on IRCTC railway booking ; focus on academic autonomy with introduction of a separate testing agency for higher education.
Shubham Choudhary : Relaxing the tax slab for lower income groups was a good move, and creating dairy processing infrastructure fund, FDI reforms, strengthening digital payment infrastructure and doubling the irrigation corpus are some of the brilliant steps that the Government has taken. I personally found listing PSEs like IRCTC on stock exchange quite intriguing.
Yash Vashisht : The FM has scored in the housing, agricultural, rural and infrastructure sectors. One of the highlights of this Budget is that affordable housing will be given infrastructure status, giving more institutional push to the housing sector. The reduction in the holding period for capital gains tax on property to 2 years, emphasis on increasing tax compliance through digital payments and also laying down guidelines for funding of political parties are some great moves. The Finance Minister has also scored well on women empowerment, skill development, start-up promotion and increasing allocation on the railway security.
The good news is that all this has been done while maintaining the fiscal deficit at 3.2 per cent of GDP, which is lower than market expectations.
Shreyas Kulkarni : Pegging fiscal deficit at 3.2 per cent; single page income tax filing document for lowest tax bracket and exemption from scrutiny while filing the returns for the first time — both steps towards increasing the tax net; MSME corporate tax rate down to 25 per cent for revenue up to ₹50 crore; tax rate halved in the lowest tax bracket to increase tax net; transparency in political funding; abolishment of FIPB to encourage foreign investments; and higher allocation for women empowerment and SC, ST and minorities.
Where has he failed?
Ruchi Negi : I think the issue of political funding required more transparency and strict regulations. Nothing major and flashy was declared (unlike the demonetisation move). Budget was kind of bland and balanced.
Shubham Choudhary : This budget was more qualitative in nature. For a long time, reforms regarding curbing black money and controlling corruption have been talked about, and the steps taken were not concrete or well executed. The allocations made to MGNREGA, Nabard, and Mahila Shakthi Kendras sound good on paper, but major steps need to be takent to ensure effective use of the same. Same goes for targets like eliminating TB by 2025, 100 per cent rural electrification, and achieving the targeted fiscal deficit.
Yash Vashisht : There was no mention of reduction in corporate tax rate, which was highly expected given the sluggish growth figures of the companies after demonetisation and weak global cues. The consumption stimulus, given in the form of reduction in income tax, is lower than expected, given the negative impact demonetisation had on consumption.
Shreyas Kulkarni : There was lack of clarity over how increased budget expenditure combined with limiting fiscal deficit to 3.2 per cent will be met; lack of clarity on the formation of Integrated PSU Oil Major; no tax relief for companies apart from MSMEs.
Does the budget ease the pain of demonetisation?
Ruchi Negi : It does, to an extent, for the middle class salaried people, with the tax slab reduction. However, more was expected from the Finance Minister. Reduction in lending rates due to increased liquidity with banks, introduction of AadharPay and of new schemes for increased usage of the BHEEM app indicates government’s commitment towards a digitalised economy.
Shubham Choudhary : It has given a good direction, but only time can tell if it is enough. While the digital payment infrastructure of the country is good enough to ease demonetisation in urban areas for middle and high income groups, it is the remote and disconnected rural areas, and people with very low incomes who need better relief options.
Yash Vashisht : The budget does little to ease the pain of demonetisation. The reduction in income tax is not encouraging enough to boost consumption. No reduction in corporate tax too was a major miss, because it was the need of the hour. Though listed companies having turnover below ₹50 crore will benefit, most big companies will not fall in this range. However, reduction on taxes on production of POS terminals for digital payment will improve the country’s digital infrastructure.
Shreyas Kulkarni : The budget focused heavily on government expenditure to compensate for reduction in demand and included provisions to boost digital economy.