Budget 2020 of India - What people want
Budget
2020 of India - What people want.
Mrs. Nirmala Sitaraman shall be presenting budget this year and she has a difficult task of pleasing different section of society.
Before we get into as to what people want there is a need to analyse as to what went wrong so far.
1) Implementation of GST
The GST implementation had many teething troubles and same is not yet over. Centre is not able to make timely payments to States and there is huge backlog. Many small businesses have folded up due to inability to take burden of GST. One famous case is marriage caterer. People found the cost too much and same as having ceremony in the hotel.
2) Increased Government Expenditure
The Government expenditure increased due to many populist schemes launched. Crores of development projects. These projects also involved heavy borrowings. For example Mumbai Metro is going to cost Rs 1,40,000, 000, 0000/- MMRDA are borrowing funds left, right and center. Recent case is of borrowing from Pension funds of Canada. These borrowings have resulted into huge interest and principal repayment. Also future expenditure is committed and there would be tax collection for the same.
3) Taxman with sword in hand.
The pressure for recovery is too much and all tax officials went out with hammer and tong after those who were paying taxes. The pressure of slower economy, lower GDP resulted into lower earnings but then Taxman had target to complete. FM has realised about this harassment and suitable instructions were given but then damage is already done.
4) Demonetization
There was a parallel economy which worked on cash transactions. It is not the case that it was black money. Material was procured in cash, labour was paid in cash, electric bill /rent/ tools were paid in cash and finished products were sold in cash. Brassware / Furniture making are examples. The demonetization folded up these businesses and they are slowly recovering after huge cash printed in China was pumped into system.
5) Withdrawal of Export Benefits
Due to objections put by USA, WTO forced India to withdraw schemes like EOU, MEIS, Concessional Interest etc. This has put Exporters in disadvantageous position. After GST was introduced many of earlier claims of exporters have not been paid.
Now we come to our WISHLIST.
Hope FM will be able to do justice.
1) Make taxation of HNI lower.
High Net worth Individuals (HNI) are those who have successful business ideas. They also have money to invest. They can generate lot of employment opportunities. Today they are running away to Canada, Australia, Cyprus, Singapore and investing in those countries. These places and many others offer tax heavens and why India cannot? The mentality of taxing more to one who is earning more has to go.
2) Commercial Rates
There are more rates of electricity, water, property taxes etc. for Commercial establishments. These things make many products and services uncompetitive. Today we are sitting on time bomb of many youths not having jobs. If business is comfortable then only more people will be recruited.
3) Railway
You have merged railways with main Union Budget. Why should other tax payers fund railways? Indian Railways have to stand on their own feet. They should spend what they can earn.
As regard ticket cost same should be competitive with equivalent bus ticket and half that of airline ticket. The cost plus pricing is not allowed.
4) Abolish Pay Commissions
Every few years you appoint Pay Commission and huge increase is given to Government staff and large amount of arrears are given.
The salaries of Government staff should be in commensurate with what their organization is earning. For example if BHEL is making money then good salaries can be paid. If Air India are making losses then freeze salaries.
5) Vacate Business for Private Sector
Any business activity can survive if one is competitive and at the end of the day contributing something to the bottom line. It is not business of Government to carry out any business. When we became Independent there was need to establish huge factories to generate employment and private sector was not coming forward. However today Private players are not only doing business here but also in other countries across all 5 continents.
6) Reduce Government Imports
It is necessary that for Government spending first priority to be given to domestic industry. If item is manufactured in India there is no need to import. By obliging other nations you are exporting jobs overseas.
7) Reduce Government Expenditure
Today you are hard pressed for funds and it is recommended that you reduce Government expenditure to 50%. In this article I do not want to give any suggestions but you need to take really really hard decisions.
8) Think about common man
Today there is food inflation by 17% and overall cost of living has gone up. On the other hand you want to increase taxes to meet your appetite. This is not fair and allow people to take breath.
9) Gold hallmark
It is open fact that in India gold ornaments are passed on from generations to generations. These ornaments are used in marriages and given to daughters when they get married.
They are also used in case of medical emergency and to meet unforeseen expenses. Are you providing social security to people of India? Then why do you want to tax gold inherited and bring in concept of hall mark etc.?
10) Long Term Capital Gains tax to be abolished.
One earns money by selling shares as he has done required study and purchased them when their price was low. Why Government should tax on money made by any one's expertise?
When market falls and there are heavy losses is Government reimbursing?
There is LTCG for house sale also. Normally person sells house under distress conditions. It can be to pay off debts, family division, moving to other city, funding new house purchase and due to family emergencies.
Why Government should make money here?
Finally one point which is beyond finance ministry but important for success of your budget is as follows
11) Peace to prevail in country.
For any business, education, health, social service etc. It is necessary that peace should prevail. One can thrive and progress towards 3 trillion USD economy only when no man day is lost, school / colleges function normally and health of people remains good.
There is no need to rock boat all the time. Take popular opinion first and then implement.
Datt Udas
datt.udas63@gmail.com
Mrs. Nirmala Sitaraman shall be presenting budget this year and she has a difficult task of pleasing different section of society.
Before we get into as to what people want there is a need to analyse as to what went wrong so far.
1) Implementation of GST
The GST implementation had many teething troubles and same is not yet over. Centre is not able to make timely payments to States and there is huge backlog. Many small businesses have folded up due to inability to take burden of GST. One famous case is marriage caterer. People found the cost too much and same as having ceremony in the hotel.
2) Increased Government Expenditure
The Government expenditure increased due to many populist schemes launched. Crores of development projects. These projects also involved heavy borrowings. For example Mumbai Metro is going to cost Rs 1,40,000, 000, 0000/- MMRDA are borrowing funds left, right and center. Recent case is of borrowing from Pension funds of Canada. These borrowings have resulted into huge interest and principal repayment. Also future expenditure is committed and there would be tax collection for the same.
3) Taxman with sword in hand.
The pressure for recovery is too much and all tax officials went out with hammer and tong after those who were paying taxes. The pressure of slower economy, lower GDP resulted into lower earnings but then Taxman had target to complete. FM has realised about this harassment and suitable instructions were given but then damage is already done.
4) Demonetization
There was a parallel economy which worked on cash transactions. It is not the case that it was black money. Material was procured in cash, labour was paid in cash, electric bill /rent/ tools were paid in cash and finished products were sold in cash. Brassware / Furniture making are examples. The demonetization folded up these businesses and they are slowly recovering after huge cash printed in China was pumped into system.
5) Withdrawal of Export Benefits
Due to objections put by USA, WTO forced India to withdraw schemes like EOU, MEIS, Concessional Interest etc. This has put Exporters in disadvantageous position. After GST was introduced many of earlier claims of exporters have not been paid.
Now we come to our WISHLIST.
Hope FM will be able to do justice.
1) Make taxation of HNI lower.
High Net worth Individuals (HNI) are those who have successful business ideas. They also have money to invest. They can generate lot of employment opportunities. Today they are running away to Canada, Australia, Cyprus, Singapore and investing in those countries. These places and many others offer tax heavens and why India cannot? The mentality of taxing more to one who is earning more has to go.
2) Commercial Rates
There are more rates of electricity, water, property taxes etc. for Commercial establishments. These things make many products and services uncompetitive. Today we are sitting on time bomb of many youths not having jobs. If business is comfortable then only more people will be recruited.
3) Railway
You have merged railways with main Union Budget. Why should other tax payers fund railways? Indian Railways have to stand on their own feet. They should spend what they can earn.
As regard ticket cost same should be competitive with equivalent bus ticket and half that of airline ticket. The cost plus pricing is not allowed.
4) Abolish Pay Commissions
Every few years you appoint Pay Commission and huge increase is given to Government staff and large amount of arrears are given.
The salaries of Government staff should be in commensurate with what their organization is earning. For example if BHEL is making money then good salaries can be paid. If Air India are making losses then freeze salaries.
5) Vacate Business for Private Sector
Any business activity can survive if one is competitive and at the end of the day contributing something to the bottom line. It is not business of Government to carry out any business. When we became Independent there was need to establish huge factories to generate employment and private sector was not coming forward. However today Private players are not only doing business here but also in other countries across all 5 continents.
6) Reduce Government Imports
It is necessary that for Government spending first priority to be given to domestic industry. If item is manufactured in India there is no need to import. By obliging other nations you are exporting jobs overseas.
7) Reduce Government Expenditure
Today you are hard pressed for funds and it is recommended that you reduce Government expenditure to 50%. In this article I do not want to give any suggestions but you need to take really really hard decisions.
8) Think about common man
Today there is food inflation by 17% and overall cost of living has gone up. On the other hand you want to increase taxes to meet your appetite. This is not fair and allow people to take breath.
9) Gold hallmark
It is open fact that in India gold ornaments are passed on from generations to generations. These ornaments are used in marriages and given to daughters when they get married.
They are also used in case of medical emergency and to meet unforeseen expenses. Are you providing social security to people of India? Then why do you want to tax gold inherited and bring in concept of hall mark etc.?
10) Long Term Capital Gains tax to be abolished.
One earns money by selling shares as he has done required study and purchased them when their price was low. Why Government should tax on money made by any one's expertise?
When market falls and there are heavy losses is Government reimbursing?
There is LTCG for house sale also. Normally person sells house under distress conditions. It can be to pay off debts, family division, moving to other city, funding new house purchase and due to family emergencies.
Why Government should make money here?
Finally one point which is beyond finance ministry but important for success of your budget is as follows
11) Peace to prevail in country.
For any business, education, health, social service etc. It is necessary that peace should prevail. One can thrive and progress towards 3 trillion USD economy only when no man day is lost, school / colleges function normally and health of people remains good.
There is no need to rock boat all the time. Take popular opinion first and then implement.
Datt Udas
datt.udas63@gmail.com
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