Government’s desperate attempts at reviving the Indian economy are quite evidently displayed in the union budget announced for the Fiscal year 2020 by Finance minister Nirmala Sitharaman yet according to the opposition it is an attempt to conceal the realities of a floundering economy and which may fail big if not executed perfectly. As of right now, the population seems to have divided opinions regarding the budget with implementations that could only be deemed convoluted.
1. The taxpayer decides: The newly declared tax slab includes a lesser tax percentage if you forego all your tax exemptions. The tax percentage is nil for annual income till 5lakh and starts at 10% for taxpayers with income 5 to 7.5 Lakhs and so on. This is a complex decision that requires taxpayers to weigh their options.
2. LIC to go public: Government plans to sell a partial stake in state-owned Life Insurance Corporation of India (LIC), country’s largest insurer and institutional investor through an IPO. This is seen as a controversial move as LIC is a profitable company even in a declining economy and the decision to disinvest in it is not quite understood.
3. Insurance cover raised: It has been proposed to increase the limit of insurance cover in case of bank failure on deposits from ₹1 Lakh to ₹5 Lakh.
4. Infrastructural spending: One of the steps proposed to kickstart the Indian economy, is building 5 new smart cities in a public-private partnership. Furthermore, Sitharaman allocates ₹1.7 trillion for transport infrastructure, which includes ideas of building more Tejas type fast trains, setting up of 9,000 km of the economic corridor.
5. Sovereign investment to be tax-free: In an attempt to attract more investment foreign investors, the sovereign wealth managers Sitharaman has proposed 100% tax exemptions by them. them. This is a positive move that could invoke some growth in the economy.