POST UNION BUDGET 2023 REVIEW : BY BIZEMAG MEDIA

Panel Members

  1. Host – Dr. Vaneeta Aggarwal – Founder of Bizemag
  2. Dr. Bigyan Verma – Director, IMT Nagpur
  3. Brig. Sanjay Agarwal – Former Security Advisor, MHA & Educator
  4. Mr. Mohit Khandelwal – Practicing Chartered Accountant
  5. Mr. Anil Gulati- Educator and Retd Defence Officer
  6. Prof. Sudhir Gavhane – Former VC, YCMOU & Chief Academic Advisor
  7. Mr. Neeraj Saxena – Managing Partner, XScale & Univision Fund

Dr. Vaneeta Aggarwal – Host

Dr. Vaneeta started the Post Union Budget Review session with 6 panelists and couple of participant audience on 2nd Feb, 2023. The session began  with Dr. Bigyan Verma, an academician and former investment banker. 

Views on Education Budget by Dr. Bigyan Verma

  1. Introduction – The speaker introduces himself as an academician with over two decades of experience in education, and also having worked as an investment banker for Morgan Stanley.
  2. Budget Analysis – The speaker mentions that the budget announcements made by the finance minister should not be altered as a published budget for it addresses structural issues for almost all segments of the population and has large number of impactful messages for a large number of sectors.
  3. Post-Pandemic Budget – The speaker mentions that this budget being post-pandemic has fiscal limitations and the private sector has a big role to play in the growth story of India.
  4. Inclusive Development – The budget focuses on inclusive development and reaching the last mile, with a focus on infrastructure investment and green growth.
  5. Focus on Education – The speaker mentions that the world is changing with regard to new systems and technologies and they are going to be a part of education. He also mentions that the education sector has received the highest ever allocation of rupees 1.12 lakh crores since independence, with a substantial part of it going for school education.
  6. Conclusion – The speaker concludes by mentioning that education is an enabling factor for the youth who will emerge to be the power for this nation.

Bigyan Verma, an academician with over two and a half decades of experience in the education sector, believes that the allocation of funds towards education in the recent budget is a significant step towards bridging the gap caused by the pandemic and setting a new era for the country’s education system. He highlights the fact that the recent budget has allocated the highest ever amount, 1.12 lakh crores, towards education since India’s independence, with a substantial part of it being allocated towards school education, which he believes is crucial in shaping the future of the country’s youth.

He then goes on to talk about the recent budget announcement and its impact on the education sector. He notes that this is the highest ever allocation for education since independence, with a significant portion of the allocation going towards school education.

Bigyan also highlights the impact that the COVID-19 pandemic has had on the education sector and how the budget aims to bridge the gap and bring the sector back to a new era. He also mentions that the budget is focusing on inclusive development, infrastructure investment, and green growth, with a particular emphasis on the youth and technology.

Bigyan Verma, who has also spent some time in the financial services industry as an investment banker, brings a unique perspective to the discussion. He recognizes the limitations of the budget, which was announced post-pandemic and had fiscal limitations. Despite this, he feels that the budget is realistic and addresses structural issues for various segments of the population. He also believes that the budget’s focus on inclusive development, infrastructure investment, green growth, and the youth, particularly in the technological and financial sectors, highlights the government’s commitment to continuing the growth story.

Furthermore, he acknowledges the importance of technology in the education sector, given the changing world, and the need for new systems and technologies to be a part of education. He specifically focuses on the impact of the pandemic on school-going children, who have faced massive disruption due to the lockdown. He believes that making children sit in front of a computer for hours is not ideal for their growth and development, and that the growth of children happens outside the classroom, through play with their peers and various activities.

In conclusion, Bigyan Verma is optimistic about the future of education in India and the role that the recent budget will play in shaping it. He believes that education is an enabling factor that will empower the youth and emerge as a crucial power for the nation. He recognizes that the budget may not please everyone and there may be skeptics and critics, but he feels that this is healthy for a democratic country like India, and the discussions and debates are necessary.

Views on Defence Budget by  Brig Sanjay Agarwal 

Sanjay Agarwal, a distinguished professor at SRM University Chennai’s NCR campus, and a former full-time advisor to the National Highway Authority of India, introduced himself to the audience by mentioning his long career in the Indian Army and his current work as a motivational speaker and teacher at various institutions. He emphasized on the defence budget as one of the key topics of discussion in his interview.

Points Highlighted by Sanjay Agarwal:

  1. Introduction of himself as the full-time advisor to the National Highway Authority of India and a distinguished professor at SRM University Chennai.
  2. His 36 years of experience as an officer in the Indian Army and his current role as a motivational speaker.
  3. Overview of the Union Budget and the allocation of 593,000 crores to the Total Defence Budget.
  4. Capital expenditure increased by 7% and revenue expenditure increased by 16% compared to last year.
  5. Overview of the Agneepath scheme, a key motivator behind the budget.
  6. 23% of the capital expenditure goes to the Army, 32% to the Navy, and 35% to the Air Force.
  7. Only 10% of the defence budget is allocated for research and development.
  8. Discussion on the new tax regime and how the Baklava people being in the 12 to 15 lakh slab will pay only 20% tax.
  9. The Agneepath scheme is proposed to exempt the corpus received from tax, allowing the young man or woman to keep the kitty intact.
  10. The financial motive behind the Agneepath scheme.

Sanjay Agarwal, a retired army officer and a distinguished professor at SRM University in Chennai, is an expert in security and defense matters. In a recent interview, he discussed the Indian Union Budget and its impact on the country’s defense. Key points covered in his talk include:

The current union budget has allocated 593,000 crores to the total defence budget, with a 7% increase in capital expenditure and a 16% increase in revenue expenditure. The defence pensions have also gone up by 15%. The allocation of the defence budget among the Army, Navy and Air Force shows that the Navy and Air Force receive approximately one-third of the budget while the Army receives one-fourth and the remaining 10% is allocated for research and development.

Sanjay Agarwal highlighted that the allocation for research and development is not as high as one would have hoped. However, he did mention that there is a bright spot in the budget with the allocation for agro tech startups. He also pointed out that the new tax regime in India, with people in the 12 to 15 lakh slab now paying only 20% tax, could positively impact the defence budget. The Agneepath Scheme, which provides a Corpus for young men and women joining the defence forces for four years, is also proposed to be exempt from tax, keeping the Corpus intact in the person’s hands. Sanjay Agarwal mentioned that the financial motive behind this scheme is the prime mover.

He highlighted that the Union Budget has allocated 593,000 crores to the Total Defense budget, with an increase of 7% in capital expenditure and 16% in revenue expenditure. Within the defense budget, the Army receives 23%, the Navy 32%, and the Air Force 35%. Research and development only receive 10% of the allocation.

The Agneepath scheme, which provides incentives for young men and women to join the military for four years, has been proposed to be exempt from taxes. This is seen as a financial motivator for the scheme.

With the new tax regime, individuals in the 12 to 15 lakh slabs will pay only 20% tax. This will have a positive impact on the defense budget.

Sanjay Agarwal also highlights the importance of increasing the allocation for research and development in the defense sector, and the potential benefits of the Agneepath scheme for the country’s security.

In conclusion, Sanjay Agarwal’s view on the defence budget highlights the increase in allocation, the distribution among the three services, and the importance of research and development. He also talked about the potential positive impact of the new tax regime and the Agneepath Scheme on the defence budget.

Views on Tax by CA Mohit Khandelwal

Mohit Khandelwal is a qualified chartered accountant who is currently in practice and has his office in Jaipur. He has expertise in the field of finance and taxation and is able to provide insights and information on the subject matter. In the given context, he has discussed the changes in the slab rate for the current financial year and explained the difference between the old and new regimes of taxation. According to him, the government has introduced new regime with some changes in the slab rates, and a person earning up to seven lakhs and opting for the new regime can avail the benefits of section 87A of the Income Tax Act and save around 15,000 every year. He also mentions that every year individuals have to opt for either the old or new regime for paying taxes, but starting next financial year, once a person opts for a regime, they do not have to disclose it again.

Points Highlighted by Mohit Khandelwal

  1. The speaker, Mohit Khandelwal, is a qualified chartered accountant currently in practice in Jaipur.
  2. There have been changes in the tax slab structure this year but there is no change in the old regime.
  3. The changes in the new regime include a rebate of up to 7 lakhs, with different tax rates for different income ranges (up to 3 lakhs exempt, 5% for 3-6 lakhs, 10% for 6-9 lakhs, 15% for 9-12 lakhs, 20% for 12-15 lakhs, and 30% for income above 15 lakhs).
  4. The government is encouraging people to shift from the old regime to the new regime, where they are not allowed to invest in any tax-saving instruments.
  5. The old regime includes exemptions for those earning up to 2.5 lakhs, 5% tax for those earning between 2.5-5 lakhs, 20% for those earning between 5-10 lakhs, and 30% for those earning above 10 lakhs.
  6. The benefit of Section 87a can be availed by individuals who opt for the new regime, saving them around 15,000 every year.
  7. Individuals have to choose between the old regime and new regime every financial year, but starting next year, they do not have to disclose their choice.

Mr. Mohit is speaking in response to a question about how the recent changes in the tax slab structure will affect homemakers and start-ups. The speaker mentions that there is a slight change in the slab rate this year, with changes only in the new regime and no changes in the old regime.

The speaker explains that the government has introduced the new regime to encourage people to shift from the old regime, where they are not allowed to invest in certain directions, to the new regime.

The speaker defines the old regime and the new regime, stating that under the old regime, if a person earns up to 2.5 lakhs, they are not required to pay any tax. If they earn between 2.5 to 5 lakhs, they are supposed to pay 5% tax, which comes to 12,500. But the government gives a rebate of 12,500 under Section 87a of the Income Tax Act, 1961. This means that if a person earns up to 5 lakhs, they are not required to pay any tax. If they earn between 5 to 10 lakhs, they are supposed to pay 20% tax, and if they earn more than 10 lakhs, they are supposed to pay 30% tax.

Under the new regime, if a person earns up to 3 lakhs and opts for the new regime, they are exempt from tax. If they earn between 3 to 6 lakhs, they are supposed to pay 5% tax, if they earn between 6 to 9 lakhs, they are supposed to pay 10% tax, if they earn between 9 to 12 lakhs, they are supposed to pay 15% tax, if they earn between 12 to 15 lakhs, they are supposed to pay 20% tax, and if they earn above 15 lakhs, they are supposed to pay 30% tax.

The speaker mentions that if a person earns up to 7 lakhs and opts for the new regime, they will still get the benefit of Section 87a of the Income Tax Act, which means that they will save around 15,000.

The speaker concludes by stating that every year, individual salary persons have to opt whether they want to pay tax as per the old regime or the new regime, but from the next financial year, if they opt for the new regime, they do not have to disclose it.

Overall, the speaker provides a clear and comprehensive overview of the changes in the tax slab structure and how it affects different sections of society, including homemakers and start-ups.

Brig Sanjay’s view on Mohit’s Speech

Brig Sanjay says that for the next financial year (2023-2024), the default tax regime will be the new regime but taxpayers still have the option to opt for the old regime by filling out a small form. The government is incentivizing taxpayers to move to the new regime and for those who do, there will be a standard deduction of 50,000 to 52,500 depending on their gross total income. The benefit of the standard deduction will only apply to those who opt for the new regime.

Anil Gulati’s views on the Defence Budget 

The speaker is discussing the recent budget and its implications. They mention the difference between the old and new tax regimes, noting that the default is now set to the new regime, but individuals still have the option to opt for the old regime by filling out a small form. The speaker also mentions the standard deduction of 50,000, which is applicable for those opting for the new regime. They also mention the limit for investing in PPF, which is only applicable for the old system. The speaker suggests that for individuals without savings, it might be more beneficial to shift to the new system, as they could potentially receive exemptions of up to 3.24 or 3.74 lakhs, but this would depend on their income.

Views of Prof. Sudhir Gavhane on Education Budget

Prof. Sudhir Gavhane expressed his thoughts on the budget and feels that investing in health and education should be given the highest priority as it is important for the development of India. He stated that the government’s allocation for health and education should be proportional to the GDP and should be in line with what other countries are investing.

He mentioned that the government should provide resources for both public and private universities to enable them to compete globally. Prof. Gavhane feels that India needs to invest in the quality of higher education, just like China has done in the last 20 years, to develop world-class universities. He also emphasized the need to invest in school education to improve the overall quality of education.

The professor expressed his disappointment in the execution of the budget, as it is not addressing the needs of the 95% of the population that is aspiring for education and health. He feels that the budget is centered towards the middle and upper-middle class and does not provide enough support for those in need.

In conclusion, Prof. Gavhane believes that investing in health and education is crucial for the development of India and should be given the highest priority by the government. The allocation for health and education should be proportional to the GDP and resources should be provided to both public and private universities to enable them to compete globally. The budget should address the needs of the aspiring population and provide better education and health facilities for all.

Neeraj Saxena’s views on the Startup & Corporate budget

Neeraj Saxena is the Managing Director of X scale, a company that invests in Indian B2Bs and helps them scale their business in both Indian and international markets. In this context, he was asked about his thoughts on the recent budget announcements and their impact on the startup ecosystem, particularly with regards to Research and Development (R&D).

Positive aspects:

a. Tax benefits and holidays for companies incorporated as start-ups have been extended to the end of the next financial year.

b. Carry forward of losses for start-ups has been increased to 10 years, which is a more realistic term.

c. India Start-up Seed Fund allocation has increased significantly to promote entrepreneurship in the country.

Missed opportunities:

a. Lack of parity between the long-term capital gain tax on start-up investment and listed equity.

b. Ambiguity and lack of transparency in the tax treatment of venture capital funds.

c. The rules for venture capital funds need to be clearer and in line with international standards to attract more investment.

Overall, Neeraj views the budget as having some positive aspects for the start-up ecosystem, but also mentions some missed opportunities for further improvement. 

Saxena begins by highlighting a few positive aspects of the budget for the startup ecosystem. Firstly, companies incorporated as start-ups and granted a startup certificate are exempt from paying income tax or allowed to have a tax holiday for three years, and this date has been extended to the end of the next financial year (March 2024). Secondly, the carry forward of losses for start-ups has been extended from 7 years to 10 years, which is a more realistic term given the typical trajectory of startups. Lastly, the India Startup Seed Fund, which promotes entrepreneurship in the country, has seen a significant increase in allocation (from 100 crore to 283 crores).

However, Saxena also points out some areas that have been missed in the budget. Firstly, there is a lack of parity in the long-term capital gains tax for start-up investments compared to listed equity investments, which he feels should have been addressed. Secondly, there is still ambiguity in the tax treatment of certain components of venture capital funds, such as management fees and carry, which needs to be made more transparent and in line with international standards.

In conclusion, Saxena views the budget as generally positive for the startup ecosystem, but feels that there is room for improvement in addressing the tax treatment of start-up investments and venture capital funds.

Watch complete session here : https://youtu.be/Nic8EvponpI

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