What do you think is the biggest issue that needs to be addressed in the budget?
Addressing India’s fiscal deficit without hampering growth at a crucial time of economic recovery will be the biggest balancing act that the budget will need to execute on. Both these objectives can be achieved by simplifying the tax code and ensuring compliance without dramatic increases in tax rates which could hamper growth. Putting more money into people’s pockets will drive consumer spending while bigger tax receipts from stricter compliance will help to drive government spending on infrastructure projects and other public services like health and education. Removing the fiscal stimulus provided over the last 18 months should not be the main objective as several developed economies are still staring a potential double-dip in the eye. While inflation at current levels is a serious cause for concern, it should be left to monetary policy to address that.
Within your sector, what would be your wish for the budget?
The Indian media and entertainment industry is one of the fastest growing industries in the country. Its various segments—film, television, advertising, print and digital among others—have witnessed tremendous growth in the last few years. According to FICCI and KPMG the media and entertainment industry in India is likely to grow at 12.5 per cent per annum over the next five years and touch US$20.09 billion by 2013. The Budget can be used as a major stimulus to achieve this objective. Some of the possible measures could be:
Single rate of CGST and SGST across goods and services
Incentives for growth of broadband penetration, digital delivery and advancement in technology
Increase the stipulated FDI limit of 26 percent to enable fund raising activity from overseas
Incentives on export of entertainment content/services
On a personal front, what would be the best thing you like to hear from the budget? /
What are your expectations from the budget?
On the personal front, I would like to see the government increase the incentive to home-owners by increasing the limit of tax deduction on interest related to home loans or mortgages. Encouraging home ownership will not only help millions achieve their Indian dream but will also lead to a gradual reduction in the grey market as it relates to home prices. Such reduction will help the government to better their receipts in this segment. A hike in the exemption limits of personal income tax as well as a uniform GST will also put more money into the pockets of consumers.
The author Neetu Bhatia is Co-Founder, Chairman & CEO Kyazoonga.com