KOCHI: The Finance Minister has presented a balanced Budget with thrust on agriculture, healthcare and rural economy. The management fraternity in Kerala is generally satisfied that many of the proposals in the Budget will be greatly beneficial to our state. The salaried class had expected a major reduction in direct taxes on account of the hardships faced as a result of demonetisation and GST. However, the Finance Minister has announced only a marginal reduction.
The proposal to reduce the tax rate from 30 per cent to 25 per cent for companies with a turnover not exceeding `250 crore is a welcome move, especially for MSME companies in Kerala. It is heartening to note the tax net has been substantially widened as a result of the measures taken by the government, but the growth in tax collections are not commensurate with the increase in number of tax payers and hence, the government has to further strengthen the collection and assessment mechanism.
The proposal regarding MSP for crops being 1.5 times the cost of production could have an inflationary impact. This being the first Budget after implementation of GST, the major proposals regarding indirect taxes are no longer a part of the Union Budget. The changes in the Customs Duty rates for certain items will have a positive impact on domestic companies.