| BUDGET 2005-06 AND ITS IMPACT ON GOA |
|
The second budget of the United Progressive Alliance Government led by the Congress (I) at the Centre has been by and large hailed as one which has tried to reach as many sections of the society as possible. If not with tax cuts and reforms, with liberal allocations to various sectors, particularly the agriculture and the rural areas, health care and employment generation. It has indeed not only spared the common man from taxes but also made the middle class happy with reduction in the direct taxation for the people at the lower end of the entry point of income tax. The budget is seen as one ensuring the continuity of the reform process. Stable tax policy and the various tax provisions will have direct impact on GDP and reduce pressure on the government in social sector reforms. Union Finance Minister P. Chidaambarams stress on rural investments, health, education, hard and soft infrastructure shows long term planning. The gender sensitivity of the budget process has also been taken up in right earnest by directing all the government departments to submit gender benefit reports of their allocations. A welcome step. Even though there has been a 50 paisa hike in fuel prices, this fund would be utilised for construction of highways. What is the direct benefit or implications of this budget to Goa and Goans ? There are no direct benefits, let us admit that. But some of the provisions in this budget will definitely have an indirect benefit for Goa. As for instance, in case of Income Tax, the restructuring of the tax structure will benefit Goan assesses (except the salaried class) in a big way as Goan assessees in the individual category are governed by the provisions of the Portuguese Civil Code (communion of property between husband and wife) which ensures equal division of their jointly held property and business assets and incomes there from for the purpose of income tax levy. Consequently, the restructuring of tax slabs as well as rationalisation of the taxation scheme as a whole is expected to give a fillip to savings in Goa. The Finance Ministers promise to keep away the taxation of interest income of NRIs will also make the NRIs happy. Since Goa has a large NRI population especially working in Gulf countries, it will make many Goans happy. This was one demand which was repeatedly being made by NRIs of Goan origin and the Goa NRI Cell had also been pursuing it with the Centre. On the Corporate side, reduction in rate of taxation of domestic companies by 5% is likely to give enough encouragement to industries for further expansion. Reduction in the peak custom duty rate will improve competitiveness of the domestic industry. Particularly the reduction in custom duty on equipment required by Pharma Industry and the benefits given for R & D will help the industry to be competitive in the new patent regime. Goa has fast been emerging as a hub for pharmaceutical industry. This industry has been a big employer for the undergraduate category of our educated youth. Any incentive to this industry will help Goa generate more employment and also earn more revenue for the state. Yet another area where Goan small businessmen have to be happy is the proposal to provide value based benefit to service tax assesses that has been incorporated in the budget. This is expected to benefit more than 80% of the small assesses. The widening of the service tax net and at the same time providing relief to small service providers by putting a threshold limit of Rs. 4 lakh turnover will also mean that a lot many service providers in our tiny state will be mercifully out of the service tax net. One area which may affect Goans adversely is the decision to introduce service tax on residential constructions. Considering the growing construction industry in the state which largely caters to the demand of the actual residential units will affect general public. Thrust given by this budget to certain sectors will further encourage Public- Private partnership. As for instance, President of Goa Chamber of Commerce and Industry (GCCI) feels that private sector participation as a contributor to the economic growth should be nurtured in a planned manner. It also feels that bureaucracy and Government should own responsibility for its commitment to private sector. Yet another area of much importance is the proposed SME bill. This bill will categorise the small scale industry into small and medium enterprises and should it be implemented effectively would do away with the # 8220; inspector raj & # 8221; and relieve of & # 8220; procedural convenience & # 8221; says Mr. Keshav Kamat, President of Goa Small Industries Association (GSIA). GSIA has long been saying that the SSI in Goa has been gripped with the problems of sickness and also fear extinction in the emerging high competitive world of WTO. Goa has over 5000 strong small scale sector which provide employment to around 30000 people. Any steps to help this sector through the SME bill will, therefore, go a long way to help this sector. The SSI, however, feels worried by the step of doing away the basic exemption in the import duty upto Rs. 1 crore while the decision to enhance the basic exemption limit from Rs. 3 crore to Rs. 4 crore is welcome. The small sector is also a bit worried about the likely adverse implications on various small industries on account of the reduction of import duty on several products. Proposal to develop Mumbai as a Regional Financial hub will indirectly benefit Goa since Goa can be developed as a back up for Mumbai. Here, one can recall the plans in the past to make Goa a free port. Should Goa take up seriously, it can definitely upgrade its financial sector to become a satellite centre for Mumbai. It is pertinent to note that Goa & #8217;s service sector is growing very fast contributing over 55% to the state # 8217;s economy. Banking, finance and insurance have a major plan in this sector and they have been also source of major employment for the educated Goan youth. Mr. Chidambaram has decided to link promotional incentives to job creating sectors. Considering Goa major need being creation of jobs, this thrust of the budget could be effectively utilised by the state government to attract employment generating industries to the state. The budget has spoken about plans to upgrade educational institutions like IISC, Bangalore which will in future make India a educational hub. The proposed knowledge commission will attract worlds attention to India as an education hub. Goa has already planned an educational estate that should attract best world class educational institutions. Goa Government should try and take the benefit of the centres plans to upgrade educational institutions. While talking about the good proposals, we should also not forget some of the proposals in the budget which would hit hard Goan businessmen. One of these is levy on cash withdrawal which is seen as a retrograde step. It will create a lot of inconvenience to a lot of people. Considering the fact that Goa has a big number of small and medium category business enterprises, the inconvenience will be all the more widespread. It is too simplistic to expect that this will curtail black money in the economy. Government should show its intent of curtailing black money through more effective and innovative measures. All in all it is good budget driving the reform process further. For any budget, its real success or otherwise is determined in its implementation. There in lies the real test of the FM P. Chidambaram. |
http://www.goainformation.org/html/modules.php?name=Sections&sop=viewarticle&artid=305
- Forwarded by www.goa-world.com
This first of its kind Gulf-Goans e-newsletter is dedicated to Goans around the Globe. http://www.goa-world.com/ Team, moderated by Almeida Gaspar since 1994 & presented by Ulysses Menezes, owner of http://www.goa-world.com website.
Upcoming events in Kuwait:
* Colva Feast of Infant Jesus on 27th Oct. 2005 at Holy Family Cathedral celebrated by Colva United Centre (CUC)
* BBSC Fiesta 2005 - 3rd Nov. 2005 organized by Bombay Boys Sports Club.
* The Sentinels presents "COUTURE MANTRA 2005" - multidimensional Fashion Show & Theme Party on 10th Nov 2005 at Faker Eldeen Palace.
* Traditional Colva Nite on 24th Nov. 2005. Details Tel 2613680, 2648731
* Goan Heritage Program organized by Club.9 at Hilton Kuwait with "Pure Magic" & "Stepping Stones" on 8th Dec. 2005.
'Speak Konkani, Save Konkani http://www.goa-world.com/goa/konkani
'Konkani uloi, Konkani samball' http://mangalorean.com/konkani/archive.php?ltype=Lesson
Yahoo! Music Unlimited - Access over 1 million songs. Try it free.
http://www.goa-world.com
http://www.live365.com/stations/61664 Live Konkani Music
http://www.mahableshwar.com/
Addresses:
Post message: [email protected]
Subscribe: [EMAIL PROTECTED]
Unsubscribe: [EMAIL PROTECTED]
List owner: [EMAIL PROTECTED]
URL to this page:
http://www.yahoogroups.com/group/gulf-goans
| Gulf coast real estate | Gulf shore al real estate | Gulf shores condo |
| Gulf shores real estate | Asian manufacturer | Gulf coast condo |
YAHOO! GROUPS LINKS
- Visit your group "gulf-goans" on the web.
- To unsubscribe from this group, send an email to:
[EMAIL PROTECTED]
- Your use of Yahoo! Groups is subject to the Yahoo! Terms of Service.
