Industry’s Expectations from Union Budget 2023-24
As we enter the New Year 2023, industries will be eager to see what the government has planned to unveil for them in terms of tax relief or policy changes in the upcoming Union Budget 2023. Union Finance Minister Nirmala Sitharaman will present the Union Budget for the current fiscal year to Parliament on February 1, 2023.
The government’s announcement of a slew of significant economic reforms over the last three years has bolstered the engines of economic growth. Along with numerous expectations, the industry veterans are keeping an eye on a few major budget updates.
The following is what the industry anticipates from the upcoming budget announcement:
Dr. Rajesh Verma, Dean of Strategy & Marketing at Mittal School of Business, Lovely Professional University
“The year 2022 had a significant impact on the education sector, from increased technology adoption to easily accessible online education and adaptable degree programs. Next year, the industry is anticipated to grow more due to the use of technology.
In that context, technological upskilling has become one of the key trends in education for 2023. Workflow automation is becoming more and more common across industries. The sharp transition from subject-based, rote learning to more skill-oriented learning methods will be a significant trend in 2023. Education experts emphasize the value of developing cognitive thinking, problem-solving, and management skills. The application-based syllabus, which steers clear of merely facts and figures and instead encourages students to apply what they have learned to real-life scenarios, is becoming more and more common.
In the modern world, detailing is also crucial. In line with that, a significant trend in education for 2023 will be the variety of subjects being taught in traditional college and university curricula. The course and subject options available today are, in fact, unconventional and revolutionary in many ways, ranging from applied linguistics to artificial intelligence, from food anthropology to ethical hacking, and from culture studies to abacus science”.
Arjun Khazanchi, co-founder & chief legal and strategy officer, Rooba.Finance
“Most experts believe that the government will reflect fiscal prudence in light of growing interest rates and impending slowdown of large economic powers like the US while also navigating a tilt towards the interest in India as a viable financial superpower in the coming decades.
There is a slow change that will need to be carried out in order to see that come to fruition but the $5 trillion may not be as far as was initially believed. Tax collections even in this environment have been rising and there is no expectation of easing rates.
There is broad consensus around a slowing in growth in the short term but inflation being sticky around the 6-8 per cent levels before a reduction follows. There are tools at the disposal of the central bank but typically these are blunt force tools lacking surgical precision. There are hopes that the blockchain world may see some form of regulatory clarity in the coming months but nothing concrete around the budget, which does leave room for further uncertainty in the space”.
Manu Awasthy- CEO and Founder, Centricity Wealth Tech
“The Union Budget 2023-24 will be presented in the backdrop of geo-political uncertainties, high inflation and slowing global growth. At this juncture, carefully thought through steps to enhance domestic sources of growth would be crucial to maintain a steady trajectory. Measures to reduce cost of capital, power, logistics, land, and labour would be most welcome along with steps to grow employment, capacity utilization and social infrastructure.
For private investments to grow, factory level business and enhanced incomes in the agriculture sector would be indispensable. The budget expectations look positive, but recessionary and inflationary tendencies must be kept in check. Factory output and growth in agricultural incomes seem to be the government’s focus, along with growing consumption. Capital goods, banking and consumer durables could be beneficiaries of some positive budgetary allocations.
Consumption and expenditure are 2 integral pillars to India’s growth story. Capacity utilisation and manufacturing sentiments are contingent to these 2 factors. With purchasing power looking to grow in the post pandemic era, coupled with the government’s vision of Atmanirbhar Bharat, infrastructure, capital goods and consumer durables could be the main beneficiaries. Infrastructure, agriculture, and capital goods could see positive momentum coupled with banking as credit penetration continues to improve. The government’s focus is expected to be on growing consumption and improving infrastructure.”
Kishore Ganji, Founder at Astir Ventures
“The government has been incredibly supportive of the startup ecosystem and has played an indispensable role in nurturing the Indian startup space into what it has evolved currently. Some possibilities that we would like to see include sector-focused funds to ensure that founders are focused on creating ventures in diverse sectors. Another area where we would like to see further support is to provide incentives for the investor, such as tax rebates to promote startup investments as a widespread phenomenon”.
Scott Horn, CMO, EnterpriseDB
“Everything we do and every dollar we spend must ultimately contribute to making our customers’ lives easier. As enterprises compete to stay relevant in a challenging market, we will continue to see the acceleration of cloud-based technologies. As such, we are making investments in product development and engineering resources to help customers reduce on-premises equipment — and the cost of doing business.”
Sunil Gandhi, CEO at JLNPhenix Energy
“The upcoming budget can be a big opportunity for the EV industry as the government may focus on policy changes and on initiatives for infrastructural improvements to enable cost-effective Lithium-Ion battery production and faster EV adoption. We are expecting the government to make big announcements for EVs, the Energy Storage System (ESS) and EV charging infrastructure.
Reduction of imports duty especially on the parts used in the lithium-ion batteries can also be presented in the upcoming budget. There is a need to relook at the GST rate for Lithium-Ion batteries and reduce it from the current rate of 18% and match it with the GST rate applicable on EVs i.e. 5%”.
Dr.G.Pardha Saradhi Varma, Vice Chancellor, KL Deemed to be University
“In the upcoming budget, we are expecting due consideration by means of higher budget allocations to infrastructure development for the effective implementation of the national education policy. Separate budget allocation is appreciated for technological enhancement, knowledge upgradation, advanced laboratories, and software, which can bring transformation in learning systems, and changes in pedagogy. The expansion of digital infrastructure to promote online education is also the need of the hour. Policies encouraging research and innovation, intellectual property, accelerated programs in the education industry, and provision for lesser taxation are desired. Also, there should be more focus on schemes and policies that encourage skill development and entrepreneurship, seed fundings, capital funds amongst the aspiring future leaders.”
Mr. Sachin Gaikwad, Founder & CEO, Buildd
“For the Indian fintech and startup industries, 2022 was a fantastic year. The upcoming budget should take into account providing tax advantages to consumers, retailers, and ecosystem enablers in light of the growth in digital payment. It should support additional collaborations between banks and fintech in order to boost innovation in the fintech sector. Furthermore, we believe ESOP policy should be relaxed in terms to avoid dual taxation. The government should make Co-lending module more flexible for PSU & large private banks to participate along with non-rated NBFCs basis their credit underwriting modules” GST subsidy for Fintechs & Financial infrastructure players who are reaching via tech to tier 2, 3, 4 towns & running microfin programs for unbanked segment should been taken into consideration”
Kanav Singla, Founder & CEO, Metadome.ai
“As a CEO of a technology company, I am eagerly awaiting the Union Budget and the government’s policy decisions that will shape the future of India’s thriving startup ecosystem. We are at the cusp of a technological revolution and it is crucial that the government supports and empowers new-age startups like ours to innovate and thrive. The Union Budget is an opportunity for the government to invest in the future and create a conducive environment for tech startups to flourish. Government can bring policy reforms around skilling and talent development. The tech industry relies on a skilled and talented workforce. The government could invest in training programs, the institutionalization of XR, and initiatives to upskill educational institutes with advanced R&D labs. With an expansion in our immersive 3D & XR platform’s capabilities to solve the modern challenges of brand-consumer engagement, we are growing and innovating every day. We can’t wait to unfold the future of immersive experiences, unlocking tremendous potential and redefining the way customers experience a brand,”
Mr. John Kallelil, Founder & CEO, XED
“The upcoming Union Budget is being presented at a tumultuous time in world history. While there have been a number of welcome economic reforms announced by the government in the past three years, Budget 2023 needs to be more strategic considering the global recession and inflation. From the EdTech perspective, there are a few key expectations for the Budget 2023 in India. One expectation is for increased government funding and support for online initiatives. Support from the government on subsidized rates and incentives for all, similar to Singapore would encourage innovation and growth in this sector. Tax incentives and financial benefits for EdTech players will boost the ecosystem substantially.
Additionally, there may be expectations for measures to improve digital literacy using technology. Overall, the EdTech community in India is likely hoping for a budget that recognizes the importance of education technology and takes steps to support its development and adoption”.
Sukhesh Madaan, Founder & CEO, Blaupunkt
“More and more consumer electronics are being equipped with microphones in order to support the integration of intelligent assistants and immersive audio experiences. The incorporation of AI computing and audio processing within APUs or SoCs for specific end systems is another noteworthy development.
The market for wireless audio equipment is rapidly growing as a result of shifting consumer media consumption patterns and the rising popularity of mobile devices. Customers increasingly use their laptops, tablets, and mobile devices to wirelessly play audio on speakers. This kind of consumer behavior is what is causing the rise of Bluetooth and Wi-Fi enabled speakers. To capitalize on the equipment’s rising popularity, manufacturers are also introducing wireless audio products or platforms. Popular Wi-Fi audio devices include the Echo speakers, SoundTouch system, and Wi-Fi speakers.”
Mr. Sathvik Vishwanath, CO-Founder & CEO, Unocoin
“India’s Finance Minister, Nirmala Sitharaman, has proposed a new taxation scheme for cryptocurrency trades in the country, including mainstream options like Bitcoin and Ether. The move marks a significant shift in policy after years of unregulated trade and a lack of regulatory definition for such assets. The proposals are the first step towards creating a more detailed framework for the comprehensive taxation of cryptocurrency trades, and the consultation process is ongoing. Under the current system, cryptocurrency transactions in India are subject to a flat income tax rate of 30%, regardless of the value of the transaction or profits being made. There is also a 1% tax deduction at source (TDS) rule in place to track every crypto exit transaction. The high tax rates have led to a 90% reduction in crypto volumes across India. In order to support the growth and development of the crypto market in India, the finance minister could consider reducing the TDS rate and the income tax rate, allowing loss set-off and carry-forward, and implementing a tax rate based on the total profits being made”.
Sumit Gupta, Founder at Viral Pitch
“The economy is growing speedily in terms of its Purchasing Power Parity and also consumption rate, there’s a clear chance of witnessing a surge in brands competing for that sweet space in their potential customer’s carts. Today, when a large percentage of customers are able to identify them as creators and the Industry is valued at $16.4 billion, it wouldn’t be a lot to expect some relaxation in TDS for small creators which will increase their in-hand payout. I can also see the surge of AR/VR and Metaverse-oriented campaigns. In addition to that, with YouTube Shorts, as Creators will become eligible to apply to YouTube’s Partner Program and get monetised, this is the time when the budget can also emphasize boosting technological enablement to execute creators-led campaigns. This will prove to be a remarkable step in the direction of empowering creators and accelerating brands alike.
Influencer Marketing has proven its mettle more as a strategic lever in Marketing. I feel optimistic about the upcoming budget and I think this would be a remarkable budget to present and promote our country as a Creator’s Marketplace and a hub of Creators’ specific Technology. Hence, ultimately unleashing the timeless potential of Indian brands on a global level”.
Dr. Kanury V S Rao, Co-Founder & Chief Scientific Officer (CSO), PredOmix
“Introducing new technologies and inventions can take the healthcare industry to a whole new level. The creative side of those inventions including advanced Artificial Intelligence, Machine Learning, and the Internet of Medical Things (IoMT), etc. in the industry needs more support and funds from the government, particularly the start-ups and small businesses. The growth will naturally result in engaging new investors in the healthcare segment.
This may also increase patient access by establishing improved infrastructure and capabilities backed by equivalent expenditures in upgrading essential hospital infrastructure, diagnostic lab infrastructure, and ambulatory/home care facilities outside of health facilities. The most important thing to take care of today is to upgrade the healthcare funding with Concessionary loans, allocate land for new hospitals, and promote CSR investment by making it tax-deductible promoting CSR investment by making it tax-deductible investment”.
Sandesh Ambhore, CEO and Founding Director, Styleyn
“The upcoming budget should prioritize infrastructure improvements and the elimination of any inefficiencies in the supply chain to ensure the smooth operation of the fashion retail industry. In addition to lower tax rates, functional fashion startups in the market expect easier compliance and tax simplification. Furthermore, the government’s primary goal should be to motivate both skilled and unskilled workers”
Mr. Naveen Kulkarni, CEO, Quantumzyme
“While India’s efforts to be the leading Pharma exporter is laudable, there is an urgent need to consider the environmental impact and support Green Chemistry initiative. More specifically the contribution of biotechnology to reduce the environmental impact of chemical manufacturing.
This convergence of chemistry and biology in developing biocatalysts has already proven in providing clean industrial processes across the globe. India has to incentivise chemical companies to adopt these new technologies and support homegrown R&D efforts.
Fiscal incentives to consider R&D expenses of large pharmaceutical and chemical companies who partner with Indian MSMEs on this front will boost not only the MSME economy, but also create awareness of technology adoption for a cleaner and greener environment”.
Nandita Krishan, General Manager (Client Engagement, Facilitation and OD) at Marching Sheep
“Budget 2022 spoke about credits and income tax bands being linked to earnings, an after effect of the rise in wages post-pandemic. As a result, last year this translated to income tax band changes and increases to the main tax credits. The effect was seen in the form of changes in several components other than the tax rate, such as surcharge and cess, which is paid by individuals as well as corporates, on top of the tax paid on their earned income. Post COVID, higher employment ratio owing to the rapid recovery of the economy thereby creating more jobs, and the financial constraint which people experienced during COVID, has put more focus than ever on net take-home pay. Hence, a natural expectation for most of India’s population from Budget 2023 is to see a range of positive income tax changes to support households who have been hit by rising costs. Even though blanket reductions across the board is unlikely, there may be targeted measures for individuals and groups, ensuring maximum impact is garnered. Another point to consider in Budget 2023 is Ease of Business. While tax certainty for businesses should continue and corporate rates should be maintained, Decriminalising GST and TDS will go a long way to bring down the already rigid and stringent law for direct taxes in India. This decade belongs to India and a friendly Budget 2023 is what we need to make it a roaring success, for individuals, businesses and the country as a whole”.