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Union Budget 2021: Expectations and Possibilities

Union Budget 2021 will be announced on 1st Feb 2021 by the Finance Minister of India Nirmala Sitharaman. The Budget 2021 of the 17th Lok Sabha of India is going to be very special and of high expectations. The expectations from large corporates to the common man running small scale businesses is going to test government's approach towards resolving the economic downturn due to covid and other structural issues pending, and further stabilizing the Indian economy for future growth. Let's look at some expectations of the concerned common man of India from Union Budget 2021 with its possibility of coming true. The foremost priority for common man, keeping the pandemic in mind will be reducing the GST rate on medical insurance premiums from 18% to 5% charged under Sec 80D of the Income Tax Act and also to include hospitalisation expenses on covid patients under Sec 80DDB of the said Act. The biggest worry that the Indian economy is facing today is our underperforming MSME sectors which comprise over 60 million micro, small and medium enterprises and nearby 50% of total exports. The recommendation that various corporates and economists have given to the government is to reduce the compliance burden and easing the cash flow in and out of the country for MSMEs by changing the RBIs norms. Other added expectation from the Union Budget is reductions in the tax slab for the automobile industry which has seen its worst slumps in many years. This year budget will be Modi's Govt most crucial budget. The adversary in which this budget is destined to be formulated is in itself challenging. For the first time, the Indian Union Budget session is going virtual or paperless, thanks to the disruption created by COVID-19. The only sector that projected positive growth in 2020 was Agriculture and emphasis on easing the hurdles in the agriculture sector will be looked with curiosity and temptation. The real state optimism being a second-largest employer is also reaching new heights from previous developments in Union Budgets and reforms like GST and enactment of RERA that enhanced transparency in the system. Notwithstanding any reforms in Banking sectors in the past, further stimulus measures need to be injected into the system. Technology and innovation are must for India to achieve its goal of becoming $5 trillion economy and collaboration of all sectors with technology-driven growth. The 2021 budget will be one step towards achieving that milestone.

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