Citizens want the Government to not just provide a tax cut via Budget 2020 but also provide an incentive to spend the same
- • 69% want tax-free income limit to be increased to 5 lakhs
- • Want environment, infrastructure and agriculture to be top areas of allocation in Budget 2020
- • Also want the Standard Deduction to be increased to Rs. 75,000
January 21, 2020, New Delhi: Amid the talks of an economic slowdown, many are hoping that the upcoming Budget 2020 would turn out to be a balancing act. The Finance Ministry recently conducted the pre-budget meetings and invited the relevant stakeholders to present their expectations from the upcoming budget. To get the citizen perspective of what areas do they want the upcoming budget to address, LocalCircles conducted a large survey and received more than 80,000 responses from across the country.
Since the Government announced the corporate tax rate cut in September this year, people are hoping that the Budget 2020 will bring some relief for the individual tax payers as well. Currently for individuals under 60 years of age, there is zero tax up to annual income of 2.5 lakhs. Citizens were asked how should the Government change this going forward. 69% aid this should be increased to 5 lakhs18% said it should be increased to 3 lakhs. 7% said it should be kept at 2.5 lakhs only and 4% said it should be reduced to 2 lakhs instead.
69% citizens want the annual income tax exemption limit to be increased to 5 lakhs
When asked what sector according to them should get top allocation in budget 2020, 30% said environment (air, water, waste management etc.), 26% said infrastructure, 16% said agriculture, 8% said rural development, 6% said skilling, while 11% said women & child safety.
Citizens want Environment, Infrastructure and Agriculture to be top areas of allocation in Budget 2020
India has some of the most polluted cities and towns in the world. With North India reeling under a spell of high pollution October-November which saw the AQI touching a record high, citizens have been demanding that the Government takes immediate measures to bring the situation under control.
The next question asked what should the Government do in Budget 2020 to control the menace of pollution. 51% aid Government should invest in enabling a stubble collection & recycling infrastructure while 22% said they should fund projects that will ensure enough ground water for farmers, thereby minimising the need for stubble burning. 8% said there should be a capacity building fund to improve municipal enforcement on garbage burning and 11% said fund technology driven interventions like large air purifiers on streets, artificial rain etc. only 4% said Government should not invent in this area through the upcoming budget.
Majority citizens want Budget 2020 to fund projects that will minimize need for stubble burning and enable speedy collection and recycling of stubble
Increasing consumer spending will be a key to bringing the economy back on track. Following question asked what is the best way for the Government to boost consumer spending via Budget 2020. 28% said just a tax rate cut across the board would do the trick while 29% said Government should provide a tax cut across the board & incentivise the tax payer to spend it within a year. 13% said a domestic tourism deduction of upto Rs. 50,000 per year should be provided, 10% said a deduction of upto Rs. 25,000 per year should be provided on school or professional education and a small 1% said a deduction of Rs. 50,000 should be given on purchase of an automobile. 16% said Government should look for other ways.
Citizens want Government to not just provide a tax cut via Budget 2020 but also an incentive to spend the same
LTA is an important component of the corporate salary packages as it allows employees to travel on a vacation and get a tax rebate for a certain amount by providing the necessary documentation. When asked how should the Government restructure the leave & travel allowance benefits currently available to employees, 24% said It should be made available each year instead of every two years and 31% said citizens should be permitted multiple trips within the prescribed LTA amount. 18% said LTA should also include hotel stays while 13% said LTA should not be restructured at all.
Majority want Budget 2020 to make LTA available each year and also permit multiple trips within the prescribed amount
In Budget 2018, the standard deduction of Rs. 40,000 was introduced in place of medical reimbursement and conveyance allowance, which was increased to Rs. 50.000 in the interim budget of 2019.
53% said standard deduction for salaried taxpayers should be increased to Rs. 75,000 per year in Budget 2020. 9% said it should be kept at the current Rs. 50,000 per year and another 9% said it should be increased to Rs. 60,000 per year.18% said Government should do away with Standard Deduction and allow receipt-based deductions.
53% citizens want the Standard Deduction for salaried taxpayers to be increased to INR 75,000 per year via Budget 2020
In 2015, the National Green Tribunal passed an order prohibiting 15-year-old petrol cars and 10-year-old diesel cars from plying on the roads. The ban impacted lakhs of people who were suddenly faced with the prospect of buying a new car while their old vehicles would be sold as scrap. The Supreme Court also ruled in favour of the NGT’s order in October 2018.
Citizens were asked how should the Government provide a subsidy to replace older cars (10-year old diesel and 15-year old petrol cars) with newer ones. 15% said a flat subsidy of Rs, 50,000 should be provided towards new car purchase, 34% said a subsidy of 20% of old car invoice price should be provided towards new car purchase and 7% said subsidy of 10% of old car invoice value should be provided towards new car purchase. 39% said no subsidy should be provided at all.
Majority in favor of Government providing some kind of subsidy via Budget 2020 to replace old car with new ones
Amid the shortage in the GST collections over the past few months, the Government has decided to start a nation-wide audit of GST returns for the financial year 2017-18. The GST Council had earlier extended the date to fill in the annual GST return from 31st December 2019 to 31st January 2020.
When asked about the GST rate tier structure that should be effective from 1st April 2020, 48% respondents said it should be a Three Rate Structure (Basic Essentials, All Others, Sin/Luxury Product) while 20% said it should be a Two Rate Structure (All product and Sin/Luxury Products). 10% said it should be a single rate structure.
Highest percentage of citizens in favour of a 3 rate GST (Basic Essentials, All Other Products/Services, Sin/Luxury Products)
Indian Railways has been cash strapped over the past couple of years and the decision to privatise some popular routes may come in as good news for the country’s largest employer. The final question asked citizens what they wanted to be the top focus area for Railways in 2020. 47% said improving services and amenities, 21% said improving safety, 15% said improving timeliness and 13% said improving cleanliness.
47% citizens want improving services and amenities to be the top focus area for Railways in Budget 2020
The International Monetary Fund (IMF) recently said that India is in the middle of an economic slowdown and urgent policy actions were required by the Government to bring things under control. Given the market sentiments, people will keenly look out for what the Government announces through the Budget 2020. LocalCircles will share the findings of this survey with the Finance Minister and other senior officials of the Finance Ministry.