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As the world struggles to regain economic footing due to the pandemic, does the Union Budget 2022-23 in any way alleviate your lifestyle or impact your daily spending?
Commonly used items like earphones, headphones and loudspeakers, umbrellas along with solar cells and solar modules and even toys are set to see a price hike due to an increase in customs duties on imported parts.
But clothes and coffee, may get a tad bit cheaper, and if you're into seafood then imported mussels and squids will also be lighter on your pocket due to the decrease in customs duty.
Travel
Don't expect to pay less for either your flights or your stays, but years and years down the road, you'll find it easier to get from one city to another with the government focusing on logistics and connectivity. With travel restrictions and borders being closed both business and leisure travel has taken a hit. While holidays have been almost non-existent, even work trips have been impacted.
But the proposed extension of the Emergency Credit Line Guarantee Scheme (ECLGS) till March 2023 and additional Rs 50,000 crore for hospitality and related sectors, has little bearing on what you end up paying today or in the near future, but the Budget focusing on the expansion of roads, railways, airports, ports, waterways will make things easier somewhere down the road.
Nakul Anand, Chairman, FAITH (Federation of Associations in Indian Tourism & Hospitality) says, "The whole tourism travel & hospitality industry is feeling quite dejected. The union budget provides some relief and medium to long term infrastructure measures to stressed tourism travel and hospitality industry but there was an immediate opportunity for more direct intervention to support the highly stressed tourism travel and hospitality companies and their employees. This could have come in the form of wage support for employees of tourism travel and hospitality companies till tourism revival happens, abolishment of TCS on outbound travel, Infrastructure status to hotels, E visa fees waiver for all tourist visas till inbound revival happens, Domestic income tax travel credit for Indian citizens and Indian companies, Export status for tourism export earnings, Global bidding fund for Indian mice companies & Setup of GST review committee to re-examine the tourism travel & hospitality GST pain points."
Madhavan Menon, Managing Director, Thomas Cook (India) Limited suggests, "The Budget made no reference to the industry's recommendations to aid revival, including rationalization of taxes (a complete GST holiday, exemption of TCS on outbound tours, reduction in indirect taxes), removal of SIES benefit capping of Rs 5 cr. For a sector that is a key contributor to the Country's GDP and brings invaluable foreign exchange earnings, with a force multiplier impact on employment and skill development, a stimulus would have created significant value in supporting the country's road to recovery and growth. The limited relief in acknowledgement of the severe impact to the hospitality sector, was the extension of the Emergency Credit Line Guarantee Scheme (ECLGS) to March 2023, with an expansion by Rs. 50,000 crores to a total of Rs. 5 lakh crore".
Taking an optimistic view Vishal Suri, Managing Director, SOTC Travel said, "The Prime Minister's PM Gati Shakti plan focusing on roads (25,000kms additional national highway), railways (2000km new railway network by 2023), airports, ports, waterways will raise productivity and be the key drivers of the domestic tourism economy. Additionally, the Parvat Mala announcement with 8 National Ropeways development projects will ease commuting and thereby improve connectivity. The two noteworthy announcements of issuance of e-passports and the expansion of the ECLGS scheme for the hospitality sector will help boost the travel and tourism industry."
Gems and Jewellery
For Indian households, spending on jewellery is not a luxury but a necessity or an essential item. Be it for weddings, investments or savings, jewellery has always been a top priority. For the Gems and Jewellery sector, the Reduction in import duty on cut and polished diamonds to 5 per cent from the current 7.5 per cent and the announced simplified regulatory framework to facilitate the export of jewellery through e-commerce will encourage the sector.
What do the experts feel? Sachin Jain, Managing Director, De Beers India states, "We are pleased with the budget announcement for our sector, particularly the reduction of customs duty on cut and polished diamonds from 7.5% to 5%. This will spur greater demand for natural and real diamonds and also give an opportunity to diamond companies to boost operations and, in turn, contribute to greater economic growth for the nation. The proposal to create a simplified regulatory framework to enable the use of e-commerce channels to export jewellery will help us seamlessly take forward our initiative to promote trade through the digital mode. This will bring down transaction costs and save time while enabling us to reach out and expand our customer base globally."
On the flip side Ketan Chokshi, Jewellery Designer & MD, Narayan Jewellers said, "While the budget this year has very little for the Gems and Jewellery industry to recover from the losses, the new norms do boost the sale. Further, the reduction in import duty to 5% gives a little relief to the diamond traders as cut and polished diamonds add up an only 5% of total imports of diamonds". Chokshi also thinks that the Gold monetization scheme, reduction in gold import Duty, increase in pan card limit amongst others could make a big difference for the Gems and Jewellery sector.
Startups
It has been a rough time for startups in the past couple of years due to the unforeseen pandemic globally. Granting a startup tax holiday in budget 2022 has been a great relief for budding entrepreneurs. Commenting on the same, Aashka Goradia Goble, Co-founder, RENEE said, "The Budget has granted the most popular wish of startups for extension of tax holiday. Now the Hon'ble FM has extended the startup tax holiday scheme to startups incorporated till March 31, 2023. This was also important as the last 2 years have been challenging for those who had just stepped into entrepreneurship and are struggling to keep their startup alive. Additionally, the surcharge on long-term capital gains (LTCG) tax has been capped at 15%. This will reduce the burden on startups in terms of ESOPs and other transactions too."
Healthcare, Mental Health & Well-being
This is probably the first time the budget has taken into account mental health and wellbeing expressing empathy for those who had to deal with adverse health and economic impact of the pandemic. Well-being received top priority in this year's budget with the government proposing to launch a National Tele Mental Health Programme to better access to quality mental health counselling and care services. This proposed Programme will include a network of 23 tele-mental health centres of excellence, with NIMHANS being the nodal centre and International Institute of Information Technology-Bangalore (IIITB) providing technology support.
Anup Rau, MD and CEO, Future Generali India Insurance believes that, "Mental health problems are growing in our country; and have reached alarming proportions with the pandemic. Increasing evidence supports that mental health issues are proliferating across geographies, age groups, and genders. We welcome the government's initiative of a national tele-mental health program and believe it's a good starting point to normalize mental health conversations and seek help and access to universal health facilities. As a responsible insurer and a purpose led brand, we strongly believe that mental health is as important as physical health and remain committed towards educating our citizens and creating awareness on mental wellness."
From the fitness side of things, Praveen Chirania, Founder, Muscle and Strength India added, "This budget will help in better delivery of health services and infrastructure to the people. To give impetus to the health & wellness industry, we expected that the government could have rationalized GST on healthcare supplements. This would have helped in making the products affordable and accessible for all and helped boost the healthcare agenda of the government, which is the need of the hour as these products play an important role in the overall healthcare and wellbeing of the population."
Taking a more pragmatic view of the situation, Devangana Mishra, Founder & CEO, Brain Bristle believes, "Understanding disability, mental health, intellectual disability in the context of privilege and minority is important. I think we have arrived at a phase in India wherein we cannot look to 'mental health' as a form of charity. We need to look at addressing the conversation and actions around mental health as a medium to create empowerment and strength in our society. We need to deeply care about allocating not just budget in quantity but in the highest quality above all. Apart from allocating millions to expand mental health as a facility, we need to make it strategic, sharp and focused to make sure everyone works towards empowerment and inclusivity in our society."