Govt. Should Simplify Tax Structure on Software: Budget 2019 Demands, An SME Perspective

The industry is looking at this year’s budget as an important turning point. Last few quarters have been very fragile due to the reporting of financial frauds, global market fluctuations and overall investor sentiments.

Industry especially, MSMEs or SMEs are extremely looking forward to seeing this budget as it can bring some sense of relief to them. Be it policy framework or credit affordability, Indian SMEs have a lot of demands from this year’s Union Budget. Although this time, it the interim budget.

Representing one of India’s most trusted SME brand, Mr. Tejas Goenka, Executive Director, Tally Solutions shared his viewpoint by saying, “Budget 2019 is being widely seen as a key milestone since it is the last budget of the current government. From an SME perspective, we are hoping to see the government bringing in required reforms and initiatives which will help in the further push towards digitization of small businesses in the country. For this to happen there will have to be increased focus on payments infrastructure and putting in an effort to digitize banking in a way that it can be adopted on a large scale. Also, the IT industry will have a key role to play in this sphere and therefore it is important that the government looks at simplifying the direct tax rules for software product manufacturers. This will enable them to spur innovation in serving the SMEs.” 

Another important area which has received a great amount of action in the last few years is financial technologies, popularly known as Fintech, has a lot to expect from the finance ministry for this budget document. Mr Sangram Singh, CEO, Freecharge around the expectations of fintech industry from the upcoming Budget ‘19.

Sharing his outlook on the upcoming budget, Mr. Sangram Singh, CEO Freecharge said, “2018 was a great year for the fintech industry in terms of new technologies and innovation. The continued focus from the Government for expanding digital penetration also saw a promising growth in the adoption of digital platforms across metro cities and tier-II markets.”

“In the near future, digital channels of engagement such as digital payments, money transfers, consumer lending will continue to grow. To strengthen this growth, we hope the budget can encourage the upgradation of digital infrastructure and digital literacy - especially in small towns and rural India, which will help drive financial inclusion through digitisation. Some of the recent initiatives such as UPI 2.0 and tokenisation provide a good opportunity for banks, e-wallets, and other players in the fintech sphere to promote digital adoption. The fintech players should continue to focus on innovation, adding smart offerings to provide relevant and personalized customer experiences and strengthening the digital payments ecosystem in the country”, he further added.