Budget 2022-23 encapsulates the essence of Atmanirbhar Bharat. The Hon’ble Finance Minister announced this Budget as the blueprint of the next 25 years of India, from its 75 to 100 (‘Amrit Kaal’). The Digital Budget fosters the idea of Self-Reliant India by focusing on capital centric economy, robust infrastructure and sustainable business.
- Expected to grow at 9.2% in F.Y. 2021-22, followed by 8.5% in F.Y. 2022-23.
- Continuous emphasis on capital spending in private investment and support growth.
- Under the Aatmnirbhar Bharat visionary for 60 lac new jobs and production of 30 lac Crores in the next 5 years.
- PM Gati Shakti framework plan to provide connectivity transformative approach for economic development, reduction of costs and aiming at efficiency.
- Digital ecosystem for skilling and a livelihood portal, DESH-stack to be launched.
- Self-Reliant India by strong push on indigenous defence equipments and weapons.
Inflation remains the major concern by a growth centric Budget focusing on capex. Further, there seems no immediate relief to the consumer goods companies however, by emphasizing on infrastructural development, the money flow shall increase by generation of employment.
- Promotion and support to manufacturing by giving of 1 year extension to avail the 15% tax regime.
- Ease of Doing Business for companies that decide for an accelerated exit from the market.
- Boosting of Domestic manufacturing by rationalizing the custom duty.
- Support to Rural markets and Semi-Rural markets under the One Station-One Product concept.
- Diamond jewellery market is boosted by a cut in the import duty.
- Relief for MSMEs by allowing 1 year moratorium extension for loans availed under the Emergency Credit Line Guarantee Scheme (ECLGS).
- Tech-based and digital businesses, startups are being promoted.
Realty and Infrastructural projects are promoted by capping the surcharge on AOPs. Drones Service Providers shall find a greater support from the Government.
Investors and Market:
- Borrowings and interest costs likely to push up by High Government Borrowings as a consequence of which bonds markets
- Government focus on capex increase of 35% and industrial growth keeps the stock market bullish.
There seems a boost in the telecom, technology, health care, manufacturing and banking sectors. However, the scope of virtual currencies is still under speculation.
- Focus on liberating the student from the constraints of time and place.
- Digital ecosystem for skilling and livelihood to be launched.
- Attempt for increasing awareness for mental health by Tele-mental health platform.
- Better connection of the providers and consumers by Digital Health ecosytem scheme.
- No change in the tax slab rates
- Standard surcharge @15% on the Long-Term Capital Gains tax for all assets to benefit the big tax payers of the society.
- Custom Duty revisions are likely to make some goods cheaper.
- 2-year window has been given to rectify the return mistakes related to misreporting of income.
- Simple settlement mechanism by removal of repetitive tax appeals.
- Cap on Alternate Minimum Tax (AMT) will support the rural and farmer groups and communities.
Funds invested in unlisted companies which were not getting liquidated because of the heavy tax rates can now flow in the market. There has been 16% reduction in the effective tax rate in case of long term capital gains which shall not only benefit the niche segment but also the financial investors.
We are hopeful that all the initiatives of the Government with the idea of Sabka Prayas (PPP model) shall be executed well and accomplished in the coming time.