TThis year Union budget’s theme has been the employment, skilling, MSME’s and Middle class. The finance minister, in her budget speech laid down 9 Priorities under which the various budget announcements were made namely; (1) Productivity and resilience in Agriculture; (2) Employment & Skilling; (3) Inclusive Human Resource Development and Social Justice; (4) Manufacturing & Services (5) Urban Development (6) Energy Security (7) Infrastructure (8) Innovation, Research & Development and (9) Next Generation Reforms.

On Direct tax front, clearly the government’s focus is on the simplification and rationalisation of the tax provisions rather than to overhaul the tax structure, or play with exemptions or deductions. Comprehensive review of the Income-tax Act, 1961 is one of such proposal which would make the Act concise, lucid and easy to understand. Contrary to the general expectations, there is no major relief to the individual taxpayers even in the Modi 3.0 government. The government has chosen to tread the difficult path of the fiscal prudence, fiscal consolidation, policy improvements over the populist measures.

On the Indirect taxes, as expected, the changes were in nature of exempting / reducing the custom duties on selective items of production with focus on promoting exports and domestic manufacturing.

Overall, the government has done well in this budget following a balanced approach and continuing making policy improvements and remaining on the path of fiscal consolidation. Many expectations of taxpayers remained unfulfilled although no major tweak in tax rate or structure is a reason for relief to many. That said, this budget like the previous budgets is going to set the growth momentum rolling forward.

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