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Budget 2024: During pre-budget consulation with Finance Minister Nirmala Sitharaman, industry lobby group FICCI on Thursday laid down a list of demands including push for infrastructure development and taking further measures to rein in food inflation for the upcoming full budget of Modi 3.0.
“We look forward to a prudent budget that builds upon the strengths of Indian economy for accelerated growth and remains committed to fiscal consolidation,” Subhrakant Panda, Immediate Past President, Federation of Indian Chambers of Commerce & Industry (FICCI) said.
Read More: Budget 2024: Give the middle-class tax benefits & cut fuel excise, India Inc tells Finance Ministry
“The Union Budget, being the first major public policy announcement of the government, is expected to set the tone for the next five years in terms of government’s policy direction,” Panda noted.
Hike Capex by 25%:
FICCI in the statement noted that the government should continue to lay thrust on public capex on physical, social and digital infrastructure in the upcoming Union Budget. “The capital expenditure outlay for FY25 should be increased by 25 percent over RE for FY24 to Rs 11.8 lakh crore,” said the industry body.
In the last interim budget, Nirmala Sitharaman proposed to raise the capital expenditure target by 11.1 per cent to record Rs. 11.11 lakh crore for the next fiscal year starting April 1.
Action with hard data for food inflation:
For the last month, country’s food inflation rose to a 10-month high of 9.82 per cent in May. Inflation in vegetables was 32.42 per cent in May, up from 23.60 per cent in the previous month. Onion inflation was at 58.05 per cent, while potato was 64.05 per cent. Pulses inflation rose 21.95 per cent in May.
Read More: Budget 2024: Rs 11.11 lakh crore of capex plan not enough? CII wants more in budget to push growth
Commenting on need to address food inflation, FICCI during the consulation said resolute action backed with hard data is required at multiple points and among multiple stakeholders. “We suggest a Food Inflation & Response Strategy Team (FIRST) to create an e-enabled, empowered coordination framework which can work with and across multiple key governmental agencies, to proactively address food inflation through logistical strategies in the short term,” said the statement.
The body on its suggesations for the agricultal sector explained that to strengthen agri-ecosystem and boost agri-productivity, PM Modi-led government should launch an agricultural yields mission for bottom 100 districts on the lines of aspirational districts. Adding to suggestions, the body also requested for national board for FPOs (NBFPO) to promote, upskill, provide a network for and monitor progress of FPOs.
GST 2.0 & Simpler tax regime:
To further enhance the ease of doing business, the government should consider laying down a roadmap for rationalization of TDS rate structure, said FICCI.
As part of its suggestions, the body has recemmended the need for three rate structures for TDS payments – TDS on salary at slab rate, TDS on lotteries/online games etc. at maximum marginal rate and two standard rates for TDS for different categories.
Further adding on indirect taxes, the industry lobby body has requested to initiate GST 2.0 reforms, with fewer GST tax slabs (max 3), inclusion of excluded sectors, and revamp of GST law to have minimal friction in achieving pass through of all input tax credits in the entire value chain.
Among other suggestions for Nirmala Sitharaman’s first full budget after government formation, the body called for initiaitves to support MSMEs and prioritizing innovation and research & development in the country.
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