Budget 2018: Finance Minister Arun Jaitley will take the centrestage to announce the much-awaited Budget 2018 at the parliament on February 1. He is expected to unwrap several policies and tax reforms that will take shape in the coming financial year, in addition to giving a boost to government’s long-standing initiatives and programmes. One of the government’s flagship initiatives, Digital India, will be one of the key areas to watch out for in Budget 2018. Presenting the Union Budget, FM Jaitley is likely to focus on the steps that the government is expected to take to encourage the digitisation in the country. While Digital India programme has by far bridged the gaps between the online and offline in both urban and non-urban areas, the industry is looking forward for additional concessions and rebates so that the dissemination of technology becomes easier.
The primary demands and expectations of the firms who are a part of the digital ecosystem in India include corporate tax reduction that will help them better their digital mechanisms. In addition, the firms want a more organised digital payment system where the customers, as well as companies, will draw benefits, thereby contributing to the Digital India programme. As pointed out by Bipin Preet Singh, founder & Chief Executive Officer, MobiKwik, “The Union Budget for 2018-19 must announce measures to accelerate the pace of India’s migration to digital platforms. People in urban and rural areas should be able to easily access financial services like loans and investment products on their smartphones. The benefits of digital services value chain must percolate to the unbanked and underbanked population as the country transforms into a knowledge-driven economy.”
According to Singh, there are six areas that need an immediate attention from the government to finally add up to the digitisation process of the country.
- Corporate Tax Reduction: The Union Budget for 2018-19 must reduce corporate tax for startups and companies promoting digital payments ecosystem. At the moment, it is flat at 35 percent.
- Sops for Fintech companies: There should also be a reduction in income tax for individuals and companies promoting secure digital payments. The Budget should announce sops for fintech companies providing data protection.
- Expansion of Broadband connectivity in India: The government should announce measures to expand broadband connectivity rapidly and accelerate the pace of migration to digital platforms.
- Less-complicated online financial solutions: People in urban and rural areas should be able to easily access financial services like loans and investment products on their smartphones.
- Knowledge of a cashless economy: The benefits of digital services value chain must percolate to the unbanked and underbanked population as the country transforms into a knowledge-driven economy. This will encourage more merchants and consumers to transact on non-cash, online platforms.
- Digital Literacy: We need to improve digital literacy and connect cities, towns and villages with high-speed Internet networks so that every citizen is empowered with access to a mobile Internet connection. This will move a large portion of cash transactions to the formal economy.