India Union Budget 2022-23: Pre-Budget Expectations From India Inc.

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Here are a few takes on what India Inc. expects from yet another pandemic-era budget, when Finance Minister Nirmala Sitharaman is all set to present the Union Budget on February 1, 2022.
 

Margaret Dsouza, Head, HR, Zeta

The past year was full of ups and downs for the entire industry – organizations are still debating their return to office strategy with newer variants emerging. There is a need to consider the current work arrangements and their related costs and provide some relief. Employees have had to create a working environment at home, incurring additional expenses related to internet charges, electricity, home work station setup. 

Apart from this, there has to be a strong focus on prioritizing health, whether preventive or expenses incurred due to Covid-19 or health concerns arising out of working from home. The Union Budget 2022-23 should consider offering more incentives and tax reforms to employees during this tenure.

With the rate of technology disruption and the major rise in digital adoption in the past 18 months, a large section of employees are at the risk of being made redundant. This has accelerated learning among employees to a great extent. The upcoming budget must provide adequate policies and measures to facilitate this move to ensure that employees are made future-ready. If you think radically, give both employees and organisations a tax incentive for investing in learning opportunities.
 

Chayan Mukhopadhyay, Co-Founder & CEO, Qandle

Our current tax system in a way penalises investing in unlisted companies for long-term capital gain, when an investor is actually taking higher risk, and eventually his/her investment is creating more jobs in the market. We need a more friendly capital gain tax system that also encourages easy access to capital. 

Additionally, the reforms should be such that Indian startups do not feel the need to incorporate outside India, which otherwise is a rising trend.
 

Gaurav VK Singhvi, Co-Founder, We Founder Circle

The startup income tax exemption, which is available to startups, is very complex and time-consuming. We understand the government must look for a simpler procedure. Additionally, ESOPs taxation is a hurdle for startups. In the early stages, startups cannot offer handsome salaries, therefore they provide ESOPs. However, if at current valuation ESOPs have tax liability then even that cushion is not there anymore. 

Furthermore, Indian startups cannot raise funds through SAFE Notes, which is the most acceptable instrument across the world. Lastly, I request the government, the way they have established SEZ Special Economic Zones or investment regions should form a Special Startup Region, SSR, which is spread across the country in Tier-II or Tier-III cities of India.
 

Madhusudan Ekambaram, Co-Founder & CEO, KreditBee and Co-Founder, FACE (Fintech Association for Consumer Empowerment)

The Union Budget 2022-23 is a crucial one, considering the economy’s efforts to fully recover and set on a growth path. In this imperative, focus on financial inclusion is very significant. The government’s recognition of the enhanced operations and effectiveness of fintechs to reach out to the unserved and underserved population, as evident from multiple initiatives in recent times, is encouraging. 

We expect this emphasis to become more prominent in the upcoming budget. It is essential that the government announce measures to ease the liquidity flow to NBFCs and fintechs. Further, while ensuring the right degree of regulation, relaxation of norms and tax liberalization to some extent will allow the fintech sector to boost their reach and operate effectively to offer innovative credit solutions to the borrowers. Focus should also be on enhancing the country’s digitization bid, to empower the consumers to avail various credit products.
 

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