Ebene News – CA – India’s ruling party calls for budget relief for middle class and businesses following virus

NEW DELHI – India’s ruling party urged the government to put more money in the pockets of middle-income families in the next budget and reduce raw material costs for small and medium-sized businesses a party spokesperson said Thursday

After the impact of the coronavirus has shrunk the economy in the past two quarters, Prime Minister Narendra Modi’s government wants to increase spending on road, port and pipeline projects in the next fiscal year to revive businesses and create jobs

Modi’s Bharatiya Janata Party (BJP) believes that if the poor received free rations and businesses obtained state-guaranteed loans and other concessions, the economy will benefit from a reduction of the middle class tax bill with more generous standard deductions

“The middle income group is feeling terrible and in need of support,” said Gopal Krishna Agarwal, who is in charge of BJP’s communication and coordination on economic affairs.

“Encouraging them to consume would also help the industry,” Agarwal told Reuters, days after meeting with the finance minister to discuss budget suggestions from party members “I can say the budget will take care of the middle class”

The government ranks over 300 million of India’s population out of 135 billion middle-class consumers

Finance ministry spokesman Rajesh Malhotra said no ministry official would comment on the new fiscal year budget, which begins in April, until the document is unveiled in parliament in February 1

Another proposal is to increase depreciation on items such as cars, factory machinery and durable consumer goods such as refrigerators so that consumption increases and corporate tax expenditures decrease, added Agarwal

For small and medium-sized businesses, the government could also consider reducing import duties on certain raw materials such as copper and base metals

“Raw material costs are rising not because of demand, but because of supply constraints from consuming industries, and they demand some relief,” Agarwal said

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Minister of Finance

Ebene News – CA – India’s ruling party calls for budget relief for middle class and businesses following virus

Source: https://financialpost.com/pmn/business-pmn/indias-ruling-party-pushes-budget-relief-for-middle-class-business-in-wake-of-virus