Budget marks Directional change for Indian economy, says Nirmala Sitharaman

PTI, Feb 25, 2021, 5:12 PM IST

Union Finance Minister Nirmala Sitharaman on Thursday said this year’s budget has negated the notion that welfare state is a socialist prerogative, and added that it has given a directional change to the Indian economy, wherein the government trusts wealth creators and citizens. She lauded the reform of faceless assessment for direct and indirect taxes, saying that tax terrorism will be a thing of the past, but also warned that “technology terrorism” will now gain ground.

“This is a budget for new decade. This budget clearly says- private sector we trust you and you are welcome to participate in the development of the country. It’s a budget in which we are recognising what a government can do or how far it can do…So it’s a budget that gives directional change to the Indian economy,” Sitharaman said while addressing a meeting of intellectuals organised by the BJP. “We inherited a system from the USSR, where glories of socialism were spoken about…That only socialism can take care of the welfare of the entire population. They say welfare state is a socialist prerogative,” she said.

“So we went for socialism, which could not fit into the Indian ethos. We have lived through this…We have lived through some of the dirty times of the license-quota raj,” the minister added. The directional change that we are talking about is we have gone through those things (socialism and license-quota raj for industries). Now, we are not suspecting you (citizens and wealth creators) that you are always upto something. We trust you and invite you to participate in the development of the country, she said.

Narendra Modi, after becoming the prime minister in 2014, discarded the system of notary saying that citizens can self attest their documents, she said, adding that the system of boiler inspector, who would certify that the boiler in a factory is ok, was also abolished. When you have invested money and are working hard to create wealth by manufacturing goods, then what is the requirement of a third party inspection to give a certificate, she asked.

“In the same way, we have changed the tax system, be it direct taxes or indirect taxes. Earlier, we used to hear complaints that we cannot put up with this tax terrorism. Such were the words used. Now technology has been brought in a big way and we hope that no official will call you up and say come and meet me and bring something (bribe) with you,” she said. Such a thing will not happen in the future as the government has gone for faceless assessment. Technology, in a large sweeping way, will look at all the transactions taking place, Sitharaman said.

Success in identifying the loopholes is better with technology as compared to the past when officers used to interact one-on-one, she said. “Technology can identify where loopholes exist, where people are misusing the system, where people are using it for their own advantage and all this is coming out without one to one interaction,” she said.

“So technology terrorism will happen next,” the finance minister said. She said that corporate taxes are the lowest in India and that is one of the reasons why foreign companies want to set up their base in the country.

Speaking about disinvestment, she said, “It is time to take a call till when we will put taxpayers’ money in running public sectors, when private sectors can do it. We do not want them to close, but we will invite private sectors to run a better enterprise.” She said that the IMF has predicted 11.5 per cent growth in Indian economy this year. “The sentiments on the ground match these predictions as the industrialists I meet are saying that they have sustained demands and their manufacturing units are running at full capacity now,” she said.

Sustained increase in GST collections also speaks about the revival of the economy, she said.

Speaking about disinvestment, she said, “It is time to take a call till when we will put taxpayers’ money in running public sectors, when private sectors can do it. We do not want them to close, but we will invite private sectors to run a better enterprise.” She said that the IMF has predicted 11.5 per cent growth in Indian economy this year. “The sentiments on the ground match these predictions as the industrialists I meet are saying that they have sustained demands and their manufacturing units are running at full capacity now,” she said.

Sustained increase in GST collections also speaks about the revival of the economy, she said.