Post-Budget Reaction by Mr. Vikas Khanvelkar, Managing Director of DesignTech Systems Ltd
From the point of view of Large scale Middle Class base, the budget looks good. There is no increase in personal taxation and there are many benefits like increasing Medical benefits to Rs 25,000 per year, increase in allowable transportation allowance from Rs 800 pm to Rs. 1600 pm and increase in allowable contribution to pension schemes from Rs 1L per annum to Rs 1.5L per annum etc.
From the point of view of the industry good points are
- Techno Financial incubation and facilitation scheme “SETU” will encourage entrepreneurship and will boost setting up of Technology Based Start-ups in India. Atal Innovation scheme will also help researchers and budding entrepreneurs to experiment with innovative ideas.
- Controlling Fiscal deficit to 4.1 % and CAD to 1.3 % of GDP is good and commitment to roll out GST by April 2016 is Welcome
- Increasing Investments in Infrastructure Development by whopping Rs 70,000 crores, will not only build infrastructure required for Industry Growth in the long run but will also create large employment and will help boost GDP in the immediate future.
Concerning Points for the domestic Industry are
- Proposal to reduce Corporate Tax from 30 % to 25 % over the next four years appears good but there is no change in the current year. On the contrary additional surcharge of 7 % and 12 % is levied on all the domestic companies with annual income of below Rs 10 crores and above Rs 10 Crores respectively.
- Increasing Service tax plus Education Cess from 12.36 % to 14 % will increase the cost of services to the end customer.
- Surcharge on distribution of Dividend has also been increased from 10 % to 12 %
All in all this is a mixed budget with more positives for the individuals and more negatives for the Domestic Companies.