Union Budget 2015: Policies to Promote Job Creation and Revive Growth

One key focus of this time’s Union budget has been job creation through revival of growth and investment and promotion of domestic manufacturing, as a part of our Prime Minister, Shri Narendra Modi’s “Make in India” campaign.

Several measures are being taken to enable this:

1. Attract domestic/foreign capital, with alternate investment funds that will levy tax on investors and not the investment funds so as to mobilize higher resources and make higher investments for SMEs. This will give the much required private equity to new venture of startups.
2. India has lots of young entrepreneurs. To facilitate tech inflow, the govt. plans to reduce rate of income tax on royalty fee on tech services from 25% to 10%.
3. To generate employment opportunities, the govt. will extend benefit of deduction of employment of new regular workmen eligibility from 100 workmen to 50.
4. For encouraging domestic manufacturing, the indirect tax rates on basic custom duty on certain raw materials in all 22 items will be reduced to reduce the manufacturing cost in India.
5. Govt. plans to abolish the wealth tax, and put a 2% surcharge on people with 1 Cr+ income. This will help the department collect an income of Rs. 9,000 Cr in lieu of giving up Rs. 1008 Cr.
6. The govt. will make it easier to do business in the country, by enabling online excise and service registration in 2 working days. Assesses will maintain electronic records and use digital signatures to file taxes to reduce paper work.
7. The govt. is allocating Rs. 150 Cr to setup a world class IT Hub in India
8. Creation of an e-biz portal that integrates 14 regulatory permissions on a single portal. Some states already joining this platform.
9. Reduction in corporate tax from 30% to 25%
10. The make in India policy will create greater self-sufficiency in defense as well with greater transparency in defense related purchase decisions.