Union Budget 2018: The government’s emphasis on MSME sector and its decision to reduce corporate tax rate will boost entrepreneurship as well as employment creation, experts said. Finance Minister Arun Jaitley today lowered corporate tax rate to 25 per cent for companies with up to Rs 250 crore turnover. “This will benefit the entire class of micro, small and medium enterprises which accounts for almost 99 per cent of companies filing their tax returns,” the finance minister said, and noted lower Corporate Income Tax rate will leave companies with higher investible surplus, leading to more jobs. “We feel it is a very positive budget. The kind of push Government has given to ‘formal employment’ and healthcare initiatives were long overdue,” Pankaj Bansal, Founder, PeopleStrong said, adding “initiatives pushing Infrastructure development, healthcare facilities, corporate tax reduction will create a positive push for formal employment creation”.
Watch video: Budget 2018: The story of the Budget Briefcase, 5 things we bet you didn’t know
According to Rituparna Chakraborty, President, Indian Staffing Federation, the union budget 2018 scores high on our immediate priorities of formalisation, urbanisation and industrialisation, however, it is muted around skill development and human capital. Experts believe, Jaitley’s announcement of 12 per cent EPF in wages towards new employees in all sectors is a good move and would lead to more number of formal job creation. “The decision of the government to contribute 12 per cent of wages of new employees in employee provident fund for all sectors for the next three years will help in bringing more employees in the formal sector to some extent and increase job creation,” TeamLease Services Vice President Sonal Arora said. Rahul Belwalkar, CEO, SecUR Credentials noted that the focus on improving quality of education is a good move by the government and this will create more employable population.
“Increased focus on MUDRA means government recognises MSME’s are going to be critical job creators making MSME’s a major engine of growth and employment,” Belwalkar added. According to experts, the government footing at least a part of the employers’ contribution bill should encourage more employers to adhere to compliances and increase formalisation of the MSME sector.
Watch video: 10 New facts on the Indian Economy
In the Union Budget 2018, it was announced that focus will be on MSME sector and experts feel it will help in generating jobs.