Budget 2009: Retail sector disappointed

Agencies
Posted: Monday, Jul 06, 2009 at 1631 hrs IST
Updated: Monday, Jul 06, 2009 at 1631 hrs IST

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New Delhi: Organised retail players are a disappointed lot with no mention of the sector being made in the Budget 2009-10 by Finance Minister Pranab Mukherjee on Monday, but said tax incentives and development programmes will spur consumer spending.

They said they were disappointed as there was no mention of either Foreign Direct Investment (FDI), or industry status for retail, despite recommendation by the Economic Survey last week to allow FDI in multi-format retail.

Industry officials, however, welcomed the budget announcement of implementation of Goods and Services Tax (GST) from April 1, 2010.

They said proposals like abolition of Fringe Benefit Tax (FBT), hike in the personal income tax ceiling and huge increases in outlay for infrastructure will bring indirect benefit to the sector by raising consumer spending.

Future Group Chief Executive Officer Kishore Biyani said there is nothing specific for the sector in the budget but termed the announcement on GST as timely.

"Plans for increasing expenditure in infrastructure under various programmes, besides hiking the income tax ceiling, will increase consumption," Biyani said.

Vishal Retail Group President Ambeek Khemka termed the budget as disappointing from the retail industry's perspective but added that abolition of FBT and hike in allocation for rural and urban areas will lead to boost in demand.

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