BUSINESSES ALSO SEEK TAX REDUCTION
Meanwhile, some businesses have expressed worries that Tuesday’s budget will offer more relief only for big businesses.
This comes as smaller businesses, often called the backbone of the Indian economy, are struggling due to high inflation, reducing customers’ spending capacity.
Some have called for a reduction in goods and services taxes (GST).
India’s finance ministry said earlier this month that GST brought significant relief to households when it was implemented seven years ago. It replaced local taxes that were higher and made essential items such as household appliances and mobile phones cheaper.
However, smaller businesses believe that GST, which stands at between 18 and 28 per cent on most items, threatens to dampen sales. It is a cost that companies usually pass on to consumers.
They said a further reduction could help make them more competitive, especially as the festive season approaches and demand is set to heat up.
India’s festive season typically runs for several weeks until the Hindu religious festival of Diwali, which takes place on Nov 1 this year.
“The customers tell us 28 per cent GST on some of these products is too high. I think this should be lower,” said Sushil Thakur, manager of Arvee Sales, an electronics store in New Delhi.
“If the taxes are reduced, then people’s purchasing capacity will increase. When that happens, sales will also grow,” he added.
