Finance Minister Nirmala Sitharaman will present her fourth budget on February 1 this year. Will the upcoming Union Budget 2022 bring any change in the existing income tax rates? COSIA,VidarbhaÂ suggested some sops/relief that entrepreneurs especially MSMEs are eagerly expecting from this budget.
COSIA ,Vidarbha Chairman CA Julfesh Shah said that taxpayers expect some relaxation or relief from the Finance Ministerin the ensuing budget. Last year, the government had announced several stimulus packages to rejuvenate the economy hit by the coronavirus pandemic.
Taxpayers are expecting relaxation or relief from the Finance Minister in the upcoming Union Budget, as the slabs have not been changed for a few years. Due to increase in exemption limit & changeÂ in slabs, there will be more liquidity in the hands of the buyers. If the government reduces tax rates for both buyers and sellers, it will rejuvenate the market. This will increase the demand for housing and other products. But, the excess liquidity in the market can be a matter of concern for the RBI, as there is a possibility of increasing inflation. Therefore, the Finance Minister will have to do proper balancing.
Government’s focus on big bang reforms to strengthen the economy and promote entrepreneurship through “Make in India” and PLI schemes.With a strong focus, this is a big plus point and expectations are high. It is expected that the Government should promote direct disposable income to boost spending and consumption.COSIA suggested to liberal & positive changes in I.Tax rates.Â
To what extent taxpayers will get tax exemption or what changes will be made in the tax structure for the next financial year is a issue which every taxpayer is looking forward. Announcements can also be made in the budget regarding further strengthening of education and infrastructure of the country. It will also be seen in this budget that the government increases or decreases excise duty, customs duty, import duty, cess on anything.
With the aim of promoting entrepreneurship and giving relief to taxpayers,COSIA suggested that the Finance Minister should make cetain important announcements in the budget about the booster package especially for the ailing MSME sector. There is a demand of the MSME sector that the rates of GST should be made suitable for this sector and the tax rates for this sector should be reduced.
Anyway, due to the circumstances of Corona in the last two years, this sector has been hit hard. Fall in production, loss of jobs, cut in revenue, MSME sector has faced many problems like this. Therefore, the biggest demand of the MSME (Micro, Small and Medium Enterprises) sector is to consider the rates of Goods and Services Tax (GST) once again. Chairman CA Julfesh Shah said that COSIA has pointed out about one of the important & reasonableÂ demands of the MSME sector is to give loans for this sector at aÂ very concessional & competitive rate of interest.
Rates of lending by financial institution should be reduced further and it should be made easier for small businessmen to do business. Licensing or audit rules should be made easier for the MSME sector.
The provision of subsidy should be introduced in this budget for theÂ various sectors.Inthe last budget i.e. for the financial year 2021-22, an allocation of 15,700 crores was made for the MSME sector, which needs to be considerably increased this year,Shah said.COSIA,Vidarbha further suggested that the real estate sector has sought a slew of tax reliefs in the Budget to boost demand for homes, including the single window clearance mechanism and increasing the interest deduction limit on home loans from the current Rs 2 lakh.
Also, the industry is expected that this time the Finance Minister will consider giving industry status to real estate, which can prove to be a dice-turner for employment and development in this sector. There is also a demand for a change in the definition of basic and affordable houses. It is expected that the upcoming budget will boost the infrastructure development and housing sector which is much needed through various amendments, relaxations and expansions. The people associated with the stock market have the hope thatThe Finance Minister should abolish or reduce the Security Transaction Tax (STT).
The reason for this is that it was implemented in place of Long Term Capital Gains. But, now capital gains tax is levied on the gains made from the sale of shares. Therefore, it is not right to have both the taxes together. Apart from this, it is necessary to make the rules related to the domestic stock market easier than other emerging markets to attract investment.
In such a situation, reducing capital gains tax would be the right step. meeting for so many hopesAll the stakeholders are looking forward to the budget on 1st February. How much relief, relaxation or positive steps will be able to get from this budget in reality, it will be seen in the coming days,concluded Shah.