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Budget overhaul: Early budget to help rake in more tax revenues
The advancement of the Union Budget day by a month will make the government richer as tax collections are set to be healthier, according to experts.
The advancement of the Union Budget day by a month will make the government richer as tax collections are set to be healthier, according to experts.
Economists said that ₹80,000-₹1 lakh crore could get added into the government kitty as budget proposals will get implemented with effect from the first day of the fiscal.
For instance, the changes in levies such as service tax made in Budget 2016 came into effect on June 1. From next year such changes will be implemented from April 1. This way the government will earn service tax revenues for two extra months.
“It a very positive move and will bring in certainty once the budget is presented at the beginning of the year,” DK Joshi, chief economist, Crisil said.
The government also put an end to the distinction between plan and non-plan expenditure. “Removal of the distinction between plan and non-plan expenditure will simplify and streamline decision-making and help in efficient use of resources,” Chandrajit Banerjee, director general, CII added.
However, not all agree. Advancing the budget announcement would also mean collecting all revenue and expenditure data by December, which may not reflect the “true picture of the economy.”
“What is the point of a Budget in January? Are we transitioning to the calendar year as the fiscal year? If not, then there is no point,” said a former chief economic advisor.
