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Editor's take: CNBC-TV18's Prashant Nair highlights expectations on tax front from Budget 2019

Updated : July 05, 2019 11:06 AM IST

Finance Minister Nirmala Sitharaman will present her maiden Union Budget today at 11 AM. As always, this time too, expectations are high from the Union Budget on the tax front.

The expectations are divided into three sections. One is the overall ability of the government to provide stimulus via taxation, direct taxes, corporate taxation, indirect taxation and then perhaps other changes which may be directed at certain sectors.

The fact of the matter is that the government is extremely constrained as far as revenue collection is concerned on the goods and services tax (GST) front and otherwise. The expectation is that the government may revisit its FY20 tax revenue assumptions. Both revenue and expenditure target for FY20 may have to be revised from what was put out earlier in the month of February.

It means that there is no space for a broad fiscal stimulus via tax cuts. Not just direct tax cuts but any other kinds of cuts as well.

The budget may also not look at tinkering with design changes as far as direct taxes are concerned. The government may tinker with the tax slabs, rates, etc.

Indirect taxes are out of the ambit of the Budget framework, they are now decided by the GST Council.

Overall, essentially, the government may only be able to provide a stimulus in a very directed specific manner.

 

Follow CNBC-TV18's live coverage on Budget 2019 here

For our exclusive coverage and all budget-related stories, click here
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