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NEW DELHI: The president of Ficci, H Khorakiwala, I congratulated
the finance minister’s “terrific budget” on
the social sector front, but said he has lost an opportunity
due to the indirect taxes imposed, which has given a wrong
signal to the corporate world.
He specially lauded increased spendings on health, education
and agriculture, and also the GDP spending that has been raised.
He said however that the corporate sector is not happy with
the indirect and direct tax burdens, especially various instances
of multiple taxation, and it would have been better had he taken
measures to ensure keeping the growth rate at 9.2 per cent
Responding to a question, he refused to term this as an anti-growth
budget, stressing that not that there will be no growth, but
it would have been better had he taken this opportunity.
He also said that the inclusive economic development is sustainable
in the long term
There will be somewhat retardation in the IT sector due to
the taxes imposed and this is a disappointment for the sector.
Ficci Secretary General Dr Amit Mitra further clarified the
body's stand, saying that it is not as if the 9 per cent growth
rate will slow down, because that has happened due to the
private sector and corporates, as well as public participation,
but the industry had expected something in the budget that
would perhaps push the growth rate beyond what is there now,
to 10 per cent.
"That is an opportunity that the finance minister has
missed and this is disappointing," he said.
Specifically on the IT sector, Mitra held the imposition
of MAT is "too premature. The government could have done
this when the IT industry would turn more mature, when we
started dealing with imbedded technologies, rather than the
preliminary technology we are dealing with now.
He also said that the tax on stock options for employees
is also a deterrent for the industry.
"The government could have lowered taxes and asked for
better collection and that would have helped industry, since
the minister admitted that tax collection has increased. Instead,
he imposed taxes, which is not the right thing.
However, he said that the reduction of the fiscal deficit,
"for the first time in 25 years, will help curb inflation,
added with the benefits that the farm sector has been given,
which lies at the core of inflation.
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