Consumption, Employment, Growth: Three-point agenda for Budget 2017


BUDGET 2017 – The Budget 2017-2018 is not only being advanced by a month but also amalgamates the Railway budget with the Union Budget. Coming in the backdrop of impending election in the states of UP and Punjab and in the aftermath of demonetisation, we believe consumption, employment and growth could be key themes of the budget this year.

While demonetisation has made a bold start by channelizing the idle cash in the economy into the banking system, it needs to be followed through with measures to improve tax compliance and initiatives to boost the digital payment economy.

We believe it is an opportune time to boost consumption demand and business sentiment, which has shown some weakness following demonetisation. A hike in the personal tax limits can be a measure which helps towards this end. The government has rightly focused on boosting the low cost housing segment with interest subsidies and we believe that some tax exemptions on interest for home loans will provide greater thrust to this segment. This can also help in employment generation as the housing sector is one of the largest employment generators.

In the past, the Government had spoken about its intention of bringing down corporate tax rates. This year, the corporate sector is expecting some relief from the budget on this front. READ MORE


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