Anuj Saxena, managing director of Elder Healthcare, says rationalisation of taxes would bring in more foreign investment into the economy and help revive the consumer sentiment.
Given the current challenges, what, in your opinion, would make for a good budget ? What measures or proposals would you like to see?
An irregular and restrictive tax regime has been giving major consumer goods and retail businesses a rather hard time and that's the biggest issue we want the finance minister to address in this year's budget. The consumer goods and retail sectors are interested in boosting sales volumes by reducing product prices... and while inflation is one factor keeping prices high, the other big factor is the manufacturer's need to pass on high indirect taxes to the consumer.
Given the constraints the government faces in raising revenue, do you see a case to increase income tax rates on the rich?
It is advisable to increase income tax rate on the rich as it would contribute in raising extra revenue for the government.
Please identify the cut-off in income beyond which you would classify the person as rich.
The cut-off income beyond which you classify the person as rich should be Rs 3 crore a year.
If the budget does not meet expectations, do you fear that business sentiment would once again fall?
Yes..! The delay in implementing Goods and Services Tax (GST ) clearly highlights the government's inability to get consensus on crucial aspects like GST rates. This has seen the original April 2010 implementation deadline lapse... which has led several state governments to levy their own taxes. As far as the consumer goods sector is concerned, in the budget we expect that the government will not increase the excise duty and service tax as that will have an impact on our selling price. We will be forced to increase prices and that may again impact demand in the sector. Hence, the expectations from this budget are quite high from the government to make amendments to create a unified tax structure across states to facilitate growth of the consumer goods sector.
Specific to your sector, what could the current budget do to improve conditions?
The consumer goods and retail sectors are anticipating that the government will roll out GST. This tax is expected to do away with levies such as octroi, central sales tax, value-added tax and entry tax, making goods cheaper. We think there is a need for the GST regime to come in. It is going to have a significant impact. Rationalisation of taxes and certain reforms allowing more foreign investment in the economy would once again revive consumer sentiment.
Which budget, in the recent past, do you remember as having been a good one?
From 1991 every government has reformed India's economic policies, wherein the key reforms were: