CA Sumeet Mehta analyses the Union Budget 2026-2027, identifying key positives and negatives.
Among the major positives according to CA Sumeet Mehta is that the Budget focuses on building manufacturing infrastructure through specialised parks for chemicals, textiles, biosimilars, and containers to create cost-effective, internationally competitive ecosystems.
There's significant emphasis on developing inland and coastal waterway transportation, reducing logistics costs and fossil fuel dependency, with capacity centers planned in Varanasi and Patna.
The government is promoting religious, spiritual, cultural, and heritage tourism following successful models in Ayodhya and Prayagraj.
City Economic Region Development will provide Rs 5,000 crore per city for infrastructure including high-rise, multi-use buildings. These initiatives collectively aim to generate employment and increase per capita income.
The biggest major negative, Mehta believes is that the Budget offers no tax relief for the middle class despite rising urban inflation, disappointing self-employed professionals and salaried individuals.
Higher Securities Transaction Tax has negatively impacted market participants.
He is also concerned that there is no relief on the compliance front. He says that India faces 1,450 compliance requirements across centre and state levels, with 480 violations carrying imprisonment -- costing businesses Rs 13 lakh to Rs 17 lakh annually, double China's compliance costs.
Most critically, populist spending continues unabated with a Rs 17 lakh crore deficit, including Rs 2 lakh crore on free food grains, creating fiscal sustainability concerns.
Video: Hitesh Harisinghani/Rediff
