Budget 2018 is for Better Healthcare: Adhil Shetty of BankBazar

Post-Budget SMEStreet-Industry Conversation with Adhil Shetty CEO and Co-founder BankBazaar:

Views on  Insurance

“Rs5Lac is a great mediclaim amount and 50 Cr individuals is a great target. This will create tremendous awareness for medical insurance in the same way as Jan Dhan which ensured every Indian to have a bank account. This will push for every Indian to have medical insurance. On life insurance, the PM Jeevan Jyoti Bima Yojana including Rs 2Lac Life cover is being pushed across a larger base which is a great sign. Rs 2 Lac critical cover is also being extended to a larger base."

Views on Taxes 

“Reduction of corporate income tax for companies with revenue up to INR 250Cr is a big announcement and will benefit more than 99% of the companies in India. The framework is still to be analyzed to qualify the benefits. Another announcement on standard deduction of INR. 40,000 for the salaried class is a great step to simplify the taxation process. Though the effect would not be much as the 40k deduction in lieu of medical and travel allowance effectively only means INR 40k- (15k+9.6k existing ) which is only INR 15.4K extra non-taxable income. At 20% tax slab, it is approximately INR 3080 in hand for a full year. This will further get reduced because of the increase in health and education cess of 1% on tax (existing 3%) which means only approx. INR 2000 in hand per year increase”

Fintech perspective 

“The budget overall is positive. There is visible support for Fintech industry as the FM specifically mentioned that Fintech is playing an important role in countries growth and hence announced setting up a working group for its growth. The biggest announcement was about insurance and Rs5Lac is a great medi-claim amount and 50 Cr individuals is a great target. This will create tremendous awareness for medical insurance. Also, reduced corporate income tax for companies with revenue up to Rs250Cr is a big one. There are a couple of points which will raise questions. The 3.5% fiscal deficit in FY18 and 3.3% fiscal deficit target in FY19 is slightly higher than expected which will impact the borrowing cost for the Private sector. Second, the introduction of a tax on LTCG exceeding Rs. 1Lac after 14 years.”

On Investment:

“The announcement of the LTCG on equity investments and 10% DDT saw the Sensex plunge 1% within minutes. However, the markets seem to have recovered immediately signaling that equity investors -- including mutual fund investors -- would absorb these blows and keep investing as per their financial objectives. After all, equity remains one of the best-performing asset classes.”