Indian Budget 2019
08 July 2019
With a new electoral mandate, the Modi government 2.0 presented its first budget in India on 5 July. The budget primarily focussed on infrastructure spending and boosting investments by private and foreign investors. The government forecasts that the Indian economy would grow to $5 trillion by 2025 which is almost twice its current size. With the budget announcements, a slew of reforms and policies are expected in the coming months for implementing these reforms, including the draft of the much-awaited Direct Tax Code which aims to overhaul the present direct tax law.
We are highlighting some of the key amendments, relevant from foreign investor’s perspective.
- Tax rates
- Real estate
- Start ups
- Electric vehicles manufacturing
- Transfer pricing adjustment
- Foreign investment
- Incentives for units in International Financial Services Centre (‘IFSC’)
- Increase of public shareholding in listed companies
- Receipt of assets below fair value
- Social stock exchange
The proposed changes to the policies and tax law indicates a direction which the government wishes to take with a hope of rejuvenated reforms. Once the proposed changes are implemented in the manner contemplated, the growth projected by the economic survey of 7% should be possible.