Publish Date: Sun, 19 Jan 2020 12:00 PM IST

New Delhi | Jagran Business Desk: Ahead of the Budget 2020, the PHD Chamber of Commerce and Industry has asked the government to focus on demand creation reforms forthcoming Union Budget 2020-21.

PHDCCI President DK Aggarwal in a statement said that the demand creation reforms will push the broad based recovery of the economy and create an environment of enthusiasm to become a USD 5 trillion economy, going forward.

At this juncture, rationalisation of direct taxes and an income tax exemption upto the level of income of Rs 5 lakhs will be a great breakthrough to enhance the personal disposable income of the individuals and to increase the consumption demand in the economy, Aggarwal, quoted by news agency IANS, said.

With no personal income tax applicable upto the income of Rs 5 lakhs for the individuals, income tax slabs should be rationalised to 10 per cent for people earning upto Rs 10 lakhs per year, 20 per cent for those with incomes of over Rs 10 lakhs and upto Rs 20 lakhs, 30 per cent for income over Rs 20 lakhs and upto Rs 2 crore and 35 per cent for individuals earning more than Rs 2 crore, he added.

Aggarwal further said that the increased expenditure of the government to enhance consumption demand along with implementation of Rs 102 lakh crore National Infrastructure Pipeline (NIP) has the potential to push economic growth trajectory to more than 8 per cent in the next three years.

Talking about liquidity crunch in MSMEs. Aggarwal said that the government need to set up a dedicated fund of Rs 25,000 crore or more with no collateral being asked for the MSMEs.

Around 95 per cent of MSMEs are in Proprietorship/Partnerships business. They are not getting any relief from the recent cut in corporate tax rates. So at this juncture we suggest a uniform tax rate of 25 per cent to such businesses, going forward, he said.

Aggarwal also spoke about the exports growth trajectory and suggested that increase in export earnings by the exporters on the base of the previous year (year-on-year earnings) should be tax free.

The PHDCCI President also urged the government to increase the spending in the public healthcare sector to at least 3 per cent of GDP with increase in annual budget each year for delivery of better health services to the people.

Health centres should be made available within the radius of one kilometer and hospitals within the radius of 10 km, said Aggarwal.

There is a need to initiate work on inclusive and approachable education with a spending of at least 4.5 per cent of GDP on education, he added.

A robust analysis of current skill gaps to promote effective skill development should be undertaken to create more and more employment opportunities for the growing workforce in the country.

Skill Mapping must be done to scientifically plan human resource needs in the different sectors of the economy.

(With IANS inputs)

Posted By: Aalok Sensharma

Go here to read the rest:

Union Budget 2020 | PHDCCI urges govt to focus on demand creation reforms in budget - Jagran English