A budget is a blend of expectations across the industry, consuming class and the corridors of the finance ministry. The broader expectations are to reduce taxes and to build new growth avenues. Our team did a survey which brought about clarity on two key priorities. For business owners and entrepreneurs, it is both the vision of the government along with support which is material. That said the government faces the two conflicting priorities of growth vs stability and the deficit funding if needed.

What are the key avenues to be looked at?

To its credit the government has been increasing Capex despite the pandemic and has done a reasonably good job, if not laudable. This has led to steady demand from the government if not from Corporates. Corporates have a good balance sheet and hence the government is more likely to maintain the growth rate of 24-25% which is in line with the increase in income tax collection figures.

One of the concerns is to increase demand. If tax rates are reduced money in the hands of the consumer could be a potential growth driver for many companies especially on the consumption side. Some of the key demands are raising tax slabs to 5 lakhs from the current 2.5 lakhs and PPF slab to 3 lakhs from 1.5 lakhs as well as streamlining Capital Gains across asset classes.

What if a war situation were to erupt? Difficult to predict even a known unknown leave alone an unknown unknown. These fissures in the world economy are likely to create supply chain related issues and raise inflation and the budget should have provisioning for the same apart from increased defence spends and humanitarian aid as India is now seen as a leader in the international scene.

A sign of a good budget is to balance all stakeholders and create a culture of opportunity.

Manufacturing led concessions would be good to watch out for. That said, FDI related tweaks could be good for mid-level enterprises. This would also be an enabler for employment generation. Growth is life and that is what we have to see in the coming budget. The Finance Minister has a bird eye view of everything critical. Hopefully the middle class and the business community would realise expectations. May the Budget halwa be sweet for all!

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To understand the implications of Union Budget 2023 and get answers to SME queries, GlobalLinker organised a webinar with seasoned Chartered Accountant & Tax Expert - CA Ritul Patwa. Watch the highlights below.

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