Meenal Sinha Shares her Expectations from Budget 2018

Budget 2018 is scheduled for February 1st. It will be the ruling NDA Government's last full-fledged budget before the scheduled General Election in 2019. Hence, there is greater expectation for it be a people-friendly. Ahead of the announcement Meenal Sinha of meetingsandoffices.com discusses her budget expectations. 

General Expectations from the Budget

The economy has recently taken some body blows as a consequence of some forward-looking decisions. However, it is now time to effect measures that help stimulate and bring the economy back to a potential justifying growth path.

1. Boost manufacturing through focus on driving consumption. This will happen via projects and infrastructure development. Import tariffs will help somewhat but those are at best short-term measures and real manufacturing muscle will come from boosting competitiveness rather than protectionism.
2. Boost rail and aviation infra in smaller towns along with the road infra through PPP to create jobs and infra – this will segue into decentralised urbanisation that is so desperately needed by India to unclog the metros and drive greater productivity.
3. Boost innovation and the entrepreneurial ecosystem.

• Get rid of regulations like demanding 30% income tax on private equity inflows into young companies. This is a blank space in the regulatory framework and needs immediate definition in a manner that makes entrepreneurship as well as investing lucrative rather than the pain it is right now. Rationalise tax structures to make angel investing attractive.
• Find ways to partner corporate entities and people who understand the entrepreneurial ecosystem to disburse government allocated funds rather than foisting the role of fostering entrepreneurship on academia. Academia in India is neither exposed to not in tune with the needs of young business. Just following a western model does not help here.
• Make government schemes announced to promote entrepreneurship more comprehensible and accessible to entrepreneurship. This needs to be done with a will to root out middlemen as navigators in this arcane system. Disbursement agencies need to have targets not only of disbursements but also of validated pipeline generation.

4. Improve the business framework

• Greater clarity and rationalisation on the convoluted GST system
• Beginning of a rationalised direct tax system
• Abolition of Dividend Distribution Tax (DDT) as incentive to companies to pay dividends and make investing interesting
• Improve credit flow through pushing rationalised lending policies by banks
• Walk the talk on job creation

Expectations of Real Estate Sector

1. Recognition as an industry to facilitate

• Easier credit
• Better borrowing rate
• Recognition of ancillaries as a part of the industry

2. Rationalised GST slabs from the current 18% to a more reasonable 6-8% - we can’t drive uptake without easing the prohibitively high tax burden on property transactions

3. Subsume stamp duty under GST – One Nation, One Tax should apply here as well

4. Reduce Long Term Capital Gains (LTCG) from REITs from 3 years to 1 year – boost commercial RE supply and bring in liquidity

5. Reduced interest rates on all RE transactions

6. Single window clearances with onus of giving timely clearance on the giver and not on the applicant – 9 months on average to receive clearances is untenable

7. Rationalise IT rates to create disposable incomes

Meenal Sinha is the Founder & CEO of meetingsandoffices.com.