5 things India Inc expects from the 2022 budget

India Inc has drawn up a list of demands for the 2022-23 budget to be presented by Finance Minister Nirmala Sitharaman on Tuesday.

Ease of doing business, increased government spending, job creation incentive programs and a simplified corporate tax system are some of the key demands companies have made to the government to it examines them before the Union budget 2022-23.

An online survey conducted by Times of India and Deloitte found that 30.4% of respondents wanted the government to increase the ease of doing business in the next budget.

In addition, 26.5% of respondents wanted increased government spending to stimulate demand and simplification of the Goods and Services Tax (GST) regime.

Rohinton Sidhwa of Deloitte told TOI that the government should opt for capital account convertibility to increase liquidity in the economy. Capital account convertibility refers to the absence of restrictions on the conversion of local currency into foreign currency in order to acquire foreign assets. Conversely, it also means that there is no restriction on the amount of money brought in by non-resident Indians to acquire local assets.

Sidhwa also suggested allowing Indian companies to borrow at global interest rates rather than borrowing at “artificially higher rates”.

Corporate tax structure

Around 47.5% of survey respondents felt that cutting corporate taxes to bring them in line with global economies in 2019 was a welcome step. Nearly 26% also believe that reducing regulations and controls will help Indian businesses compete with their global counterparts.

Meanwhile, the Confederation of Indian Industry (CII) proposed incentive schemes for labor-intensive industries to attract investment and boost employment.

“With the imperative to support jobs and create new jobs as the country recovers from the pandemic, CII suggests that the budget add a job creation element to the incentive. CII also recommends that sectors to higher employment intensity be placed under the PLI schemes which will greatly encourage investment in these sectors,” said CII Director General Chandrajit Banerjee.

These incentives may depend on the number of jobs created with more weight to job creation for PLI schemes, the industry body added.

CII has also proposed to increase spending on the Rural Employment Guarantee Scheme MGNREGA to increase consumption.