The Union Budget 2015-16 is a positive budget and step in the right direction. I appreciate the fiscal discipline and intent to reduce the fiscal deficit that stood at 4.5% of GDP in 2013-14 to 4.1% for the financial year 2014-2015 and subsequently reduce it to 3.6% in 2015-16 and to 3% in 2016-17. Overall I see a spirit of enablement, long term growth with announcements of multiple schemes aimed at bringing a change in the economic and social ecosystem that includes job creation, skill development, bridging the social divide etc.
The efforts on overhauling India’s business environment and boosting the country’s presence in the global map of ease of doing business is commendable. Right from cleaning up the links to tightening of processes and stringent laws for eliminating black money, monetizing gold-Sovereign Gold Bond will have a populist sentiment around it. The commitment to further this process through online central excise and service tax registration in two working days, issuance of digitally signed invoices and maintenance of electronic records and cutting down of paper work and red tapism will be a significant move in digitizing India and IT industry players like us will look at working more closely with the Government on such projects.
The government had promised to make it easy to do business in India and the intent is evident in the budget. The announcement to roll out GST from April 2016, reduction in corporate tax from 30% to 25% over 4 years, reduction of tax on royalty and technical fee as well as re-assurance on retrospective taxation will complement the efforts of improving investor sentiment and making India the next business destination. The focus on critical sectors like infrastructure and power & renewable energy construction as well as focus on skill enhancement are also steps in this direction.. While revised service charge rates increases the risk of more cash transactions at a micro, small industry level, but this is perhaps a necessary and important a step towards GST implementation.
The Budget on paper looks to be an outstanding ‘business plan’ with a roadmap for the next five years with right balance between social and economic objectives with focus on critical areas and now it is really upto how well it is executed on the ground.