Sunday, 15 July, 2018

Budget 2018: 25% corporate tax cut to benefit MSMEs, not big firms

Budget FY19 Will there be any change in GST Representational Image of Indian Rupee with GST tag
Melinda Barton | 01 February, 2018, 11:44

Apart from launching a comprehensive educational programme well in advance of the implementation of the new tax system, the Government even provided funds to any small-to-medium businesses that needed transition assistance to the new system.

The Budget preparation exercise is sure to have kept the finance minister on the edge given the timing of the presentation. The budget may also see many attractive schemes for the retail sector that has been the traditional vote bank of the BJP.

Finance Minister Arun Jaitley has announced a number of schemes and measures that are expected to benefit the education industry and also improve infrastructure in the sector.

The Modi-led government has long drawn criticism for India's so-called jobless growth, or economic improvement with relatively little employment creation.

If the Economic Survey, prepared by Chief Economic Advisor Arvind Subramanian and his team is anything to go by, Jaitley has all the ammunition that he needs to sound the election bugle for 2019 with this All he needs to do is lock, load and fire.

"Our key expectation is a cut down in the effective corporate tax rate".

Will Modi govt reduce stress in the farm sector? The rating upgrade was seen as a seal of approval for the Modi government's fiscal management. Be it Bharatmala Project aimed at boosting road connectivity in the country or development of ports under Sagarmala, . government may take several steps to boost the infrastructure sector, which will not only boost the economy but also help in creating jobs. The Survey says: "In developing countries, working women also invest more in the schooling of their children..." The world is optimistic about India.

Further, the impact of increasing oil prices and the U.S. tax reforms, as per 53 percent of the respondents, are the two most global factors that will impact the Indian economic environment.

India has slipped to 42nd place on an annual Global Democracy Index amid "rise of conservative religious ideologies" and increase in vigilantism and violence against minorities as well as other dissenting voices.

Tax slab rejig: It is expected that the minimum exemption limit may be increased from INR 2.5Lakh to 3Lakh per annum so as to give more purchasing power in the hands of the common people and small entrepreneurs. In the 23rd GST Council meeting, it was announced that companies with an annual turnover of less than 1.5 crore can file the GST quarterly and all other companies with a higher annual turnover than this, monthly. It is, in fact, likely to be doubled in Budget 2018 to Rs 18,000 per month.