Budget fails to meet expectations in the backdrop of weakening macroeconomic conditions: Krishna Karwa

Revision of tax slabs was an eagerly anticipated positive, but it has been offset by the rider of forgoing exemptions/deductions.

Feb 01, 2020 05:02 IST India Infoline News Service

"Overall, the budget fails to meet expectations in the backdrop of weakening macroeconomic conditions. There seems to be no meaningful stimulus to private sector infrastructure, manufacturing, real estate and rural spending. Issues pertaining to unemployment and weakness in the financial system have not been addressed satisfactorily either.

Revision of tax slabs was an eagerly anticipated positive, but it has been offset by the rider of forgoing exemptions/deductions. Nevertheless, individuals have the option to continue with the prevalent tax structure. Lack of relief in long term capital gains tax and taxability of dividend distribution tax in the hands of recipients may disappoint retail investors.

Measures to attract foreign capital, undertake disinvestment (especially through LIC stake sale via an IPO), facilitate consolidation of public sector banks and offer relief to MSMEs are some of the green shoots. It remains to be seen if such announcements are backed by an equally robust execution strategy."

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