Mumbai: The pre-budget scenario is very much like watching a movie trailer or even a teaser advertisement or even the stock market. The Prime Minister Narendra Modi has been dropping hints about a tough budget and his proxy, Union finance minister Arun Jaitley has been saying announcing from various platforms that they will not resort to populism. So one can imagine taxes being raised in every direction. If the budget is to be harsh and not populist then it has to be the opposite of what people want. This could also be the government behaving like the stock markets. They always factor in the forthcoming events with the result that on the actual day of the event they do not react as the inevitable has already been discounted.
With the budget a week away the aam aadmi has already had a taste of harsh measures. The prices of diesel and petrol have gone up and so has sugar. Earlier railway fares were hiked and rolled back a bit after countrywide violent protests.
Prices of the must-have onions and potatoes have gone up and all that the government has been saying till today is that they have asked the states to come down on hoarders. Most recently they have brought these items under the Essential Commodities Act and had earlier taken them out of the purview of the Agricultural Prices Marketing Committee. But what good is all this as prices still rule high. We have still not heard the government say that they have raided X number of godowns and caught X tonnes of potatoes and onions and arrested X number of hoarders.
But with these complaints out of the way there is a lot of expectation of some out-of-the-box thinking in this Budget. The general population that has taxable income can only hope that the tax slabs are raised and some of them can come out of the tax net to keep their family budget from going askew. As the industry body Assocham has pointed out “It is imperative for India to widen its individual taxpayers’ base from 3.6 crores to 5 crores in the short term to increase tax revenues.”
The Modi government has given the impression that they are out-of-the-box thinkers so one would expect them to find ways and means of bringing more people within the ambit of the tax regime.
Since harsh measures would be needed to keep the fiscal deficit at a reasonable level it would need not just trimming and pruning government expenditure but major surgery on the government’s wasteful expenditure.
Despite many of the good administrative measures taken of streamlining the bureaucracy, and some measures to ea eth way of doing business, what is sorely lacking even one month of the Modi government coming to power, is the government’s plan, just a road map, for a state-of-the-art delivery and monitoring system and tackling the supply side constraints whether on the food front or on the infrastructure front where there is a lot of bottlenecks. Just clearing projects like the predecessor government did doesn’t mean projects have got off the ground. The government is full of good intentions whether on health care, education etc but some of this has to be translated into action. We will now on July 10.
