Capital goods and numerous PSU equities have risen in value within recent years due to the government's emphasis on raising capital expenditure to upgrade the nation's infrastructure. For example, in the last year, the Nifty CPSE index has increased by more than 80%. Since this has greatly increased investor wealth, the markets want it to continue.
Expectation from different sectors
Double Taxation on Dividends: Business pays taxes on its income, the current taxation on dividends received by shareholders is seen as double taxation. Market players voice their dissatisfaction with this approach, including well-known investors. We would be grateful for any relief from this double taxation on dividends.
Policy Announcements: Expectations for announcements or extensions of policy, with a concentrate on maintaining the primary incentive program for producing electric cars (EVs) into the upcoming fiscal year.
Market expectation from election:Markets anticipate that a comprehensive budget will reveal important long-term initiatives, an increase on the long-term capital gains, and 80C exemptions.
Simplifying the tax laws governing different types of investments could increase diversity.Maintain a balance between necessary expenditure for expansion and controlling the fiscal deficit is essential for markets.
Budget may make the poverty index more understandable: Once expired on the table, the Great Indian Poverty Argument has come back. Economists are passionately debating whether poverty has decreased or increased, and they support both sides of the issue.
The multidimensional poverty index, just released by Niti Aayog, reveals that almost 13.5 crore people have been lifted out of poverty during the time, with the poverty ratio falling from 25% in 2015–16 to 15% in 2019–20. For the following five years, the government continued to give free grains to 81 crore people, despite the data suggesting a reduction in poverty.
The Finance Minister’s speech might throw some light on the poverty discussion even though the Budget is not included in the estimates for poverty
The salaried class expects Section 80C and exemption limits to increase.
The basic exemption limit and Section 80C are expected to rise, as expected by the salaried class. Expectations for Budget 2024 include raising the limit on the senior citizens' savings scheme, which is currently at Rs 1.5 lakh, to more than Rs 30 lakh, as well as increasing income tax rebates.
Income tax rebate rise unlikelyto a key finance ministry source, it seems uncertain that the new direct tax regime will result in a rise in tax rebates in the upcoming interim budget.
To boost the value chain for rural healthcare, the government must spend more
It is imperative that the healthcare value chain be strengthened, especially in rural areas where a considerable population still lacks access to high-quality treatment. Spending more on healthcare is crucial to achieving this. The budgetary allotment is currently a pitiful 1.6–1.8 percent. "To achieve a significant effect, it is recommended that we increase it to 2.5 or 3 percent of the current budget.
The travel industries trends
Hon'ble Finance Minister's action will not only improve tourist accessibility to lodging but also stimulate additional investment in the industry and expand the number of organized hotels in India.
Fuel for aircraft turbines (ATF) - FM Sitharaman can explore a broader policy framework that indirectly affects the cost of ATF, like central excise charges and customs duties. ATF reductions may set off a chain reaction that would boost airport income, increase air travel frequency.
The beneficial tax rate of 15 percent for new beyond the current period of March 31, 2024, may get extended to push the Make in India campaign. Home loan interest deduction up to Rs. 2 lakhs would be made available under the new income tax regime.
Pharma business looks for favorable laws and incentives for R&D
According to a statement from the secretary general of the Indian Pharmaceutical Alliance, research carries a significant risk, takes a long time to mature, and has a low success rate; for these reasons, ongoing funding is required.
There were several rumors circulating that the vote-on-account personal income tax rebate might increase from the current Rs 7 lakh to Rs 7.5 lakh.
In the interim budget, the government is anticipated to declare an exemption from tax collected at source (TCS) on individual foreign credit and debit card expenditure, up to a maximum of Rs 7 lakh each fiscal year.
The budget for 2024–2025 should include favorable policies that assist the pharmaceutical industry in terms of direct and indirect taxes as well as ease of doing business.
The government is expected to come out with measures to support sustainable growth in income amongst rural households, thereby boosting rural economy's disposable income,For FY24, nominal GDP growth is estimated to be around 8.9 percent. With this number, one may estimate the fiscal year's nominal GDP and then calculate the expected tax revenue, which is usually between 10 and 11 percent of the nominal GDP because tax-to-GDP ratios in India are often within that range. Also maintaining growth while reducing the budget deficit and increasing consumption growth.
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