It?s business: Analjit Singh
The hype and the sensation around the budget is passe, writes Analjit Singh chairman, MAX Group.india Updated: Mar 01, 2006 15:50 IST
The hype and the sensation around the budget is passé. At a time when tax rates were among the highest in the world and business practised around tariff barriers and industrial licensing, the budget was a "mantra for business".
Today, it has lost significance in a relative sense and besides, there is nothing magical about policy pronouncements on February 28.
This year's budget is neither red, orange or green… it is almost faun. It is ‘BUSINESS AS USUAL’. Notwithstanding this, it is surprising that the FM has continued with the FBT, increased MAT from 7.5 per cent to 10 per cent and service tax from 10 to 12 per cent.
If FBT is the new buzzword, then how about 'FORCED BUSINESS TAX'? Retaining FBT viz superannuation will discourage savings for retirement and could be inflationary with preference to hold on to cash. If the country can achieve 8.1 per cent GDP growth and moving to 10 per cent, imagine what the outcome would be with superlative infrastructure.
Conversely though, 10 (23G) has been abolished…this will affect investment in infrastructure. I cannot understand the rationale of not extending the benefit to healthcare, power, roads and the likes. Fiscal incentives have transformed and shaped trends in US. For example, investment in real estate were the key drivers in Florida's transformation. All in all, the finance minister should be congratulated for bringing down the budget deficit to 3.1 per cent of the GDP and position budget day to be a near regular day in our business lives.
(The writer is chairman, MAX Group)