Expectations from Budget
GOVERNMENT has to focus on Fiscal
responsibility.
1.
Over the last few years there is complete indiscipline in the management of
budgetary deficit on account of various schemes and not providing them in the
budget:
Loan waiver to farmers. Social
Security's Scheme, MNREGS, with rampant corruption and complete disregard to labour
and industrial policy.
2.
Excess liquidity in the system as a result of: Deficit financing, Corruption
and black money.
Causing dilemma to Policy Makers
over the tradeoff between Inflation Economic growth.
3.
Long overdue Pending Commodities market reforms: The whole Supply chain is in
disarray. Large-scale Investment in storage and warehousing facility required
through incentivizing Public Private Partnership (PPP) model, Agriculture
Produce and Marketing Committee Act needs review, Immediate passing FCRA act in
parliament to properly empower Forward Market Commission (FMC).
4.
Some anomalies have come into Financial Markets that need immediate attention:
Very High cost of transaction at domestic exchanges due to multiplicity of
taxes leading to Fight of transaction to international market, Infrastructure
investments for making Mumbai as a Global Financial Center, Autonomy of SEBI
has to be kept intact and away from intervention of Ministry of finance,
Complete removal of Securities Transaction Tax (STT), delinking it from Capital
Gains Tax, which is the route being adopted to bring back money stashed in
foreign countries by culprits through the Participatory Notes(PN) mechanism,
Implementation of Uniform Stamp duty across all states and not link it to GST,
which is facing stiff resistance from states.
5.Checking
illegal flows and bringing transparency in International financial flows:
Signing of Double Taxation Avoidance Agreements (DTAA) with all tax havens,
Control over Transfer Pricing so as to check Under and Over invoicing of
imports and exports, Put checks and balances in the General Anti Avoidance
Rules (GAAR) Provisions, to keep check on draconian powers to Income tax
department.
6.
Disinvestment of Public Sector Units so that government concentrates on
Governance instead of business and these units do not become dens of corruption
for the people in power.
7.
Issue of subsidy payment directly to the end user in the form of cash through
Unique Identification Number (UID). Subsidy should be target driven and not
product based.
8. Inclusive growth through
structural reforms and not through social security measures. At present 37 per
cent of GDP is being used for them and these are being misused to buy votes.
9.
FDI in retail and other sectors is a very contentious issue and needs a
detailed rethink. Secondly, at present we don't need foreign exchange reserves
to that extent, therefore we can hold ourselves in this matter and change our
priorities looking into the requirement of domestic industry and trade.
10.
Cooperative sector has contributed a lot to the overall development in the
country and therefore has to be given special treatment. And the exceptions
that have been withdrawn under Direct Tax Code (DTC) have to be restored, but
only for smaller cooperative so that they do not become vehicle of business.
