Budget 2022: Additional Tax Incentives Can Act As A Growth Driver For Long-Term Investors: Survey

The budget day is only a few hours away, and taxpayers' expectations have risen as a result of tax break rationalisations or promises of additional tax incentives. As we all know, the government announces tax incentives for infrastructure spending as crucial factors for market and economic resuscitation every year.

But this year around 55% of industry leaders expects additional tax incentives from the government. According to a Pre-Budget Survey FY'22 conducted by Deloitte "About 55% industry leaders agree that additional tax incentives can act as a growth driver for long-term investors for infrastructure investment. Infrastructure investments in areas such as power, roads, railways, ports, airports, healthcare, power, electrification, and education can be given tax incentives."

The survey also found that "Over 45% of respondents believe that increased R&D spending would be beneficial for sectors such as life sciences, automobile, capital goods, technology and telecommunication. Nearly 35% of industry leaders suggested higher credit support for MSMEs and an accelerated divestment/asset monetisation programme for enhanced growth of the sector. About 48% of respondents expressed that reviving demand by creating jobs and reducing personal taxes could boost the growth of their sectors."

Apart from tax expectations, the survey discovered that "More than 50% respondents stated that building innovative structures to get Injecting capital in the economy private capital into the infrastructure sector will boost the project financing. This proportion has decreased by 12% from the previous year. About 52% of respondents feel that the improved use of the National Pension System (NPS) and other long-term funds can help inject money into the economy for project financing."

The government declared Aatmanirbhar Bharat Abhiyan on May 13, 2020, which has already had a significant influence on India's five pillars: economics, infrastructure, digital services or innovations, demographics, and demand and supply. Owing to the same "More than 90% respondents (compared with 58% past year) believe that Atmanirbhar Bharat is helpful; 100% electronics and nearly 100% automobile respondents strongly support this initiative" the survey highlighted.

Let's see what the government is announcing today to make India more Atmanirbhar Bharat reliant, whether it's economic growth prognosis and industry moods or taxation reforms and expectations.