Budget 2016 is transformational and balanced and looks at fundamentally changing the economy of India, says Mark Weinberger, Global Chairman and CEO of EY.
In an exclusive interview to CNBC-TV18's Menaka Doshi, he also appeared skeptical about the government's retrospective tax solution in the Budget.
Below is the verbatim transcript of Mark Weinberger’s interview with Menaka Doshi on CNBC-TV18
Q: What are your views on the Indian Budget?
A: It is a transformational Budget that looks at fundamentally changing the economy of India. It is not short fixes, give always things to try and help various constituencies. A lot of the things the Budget is trying to do will transform the economy over a longer period of time that gives investors an opportunity to see where the decision process is.
So, looking for the infrastructure investments or for the incentives for foreign direction investments (FDI) those are things that are not going to happen day two or day three but they will take a year or two or more to happen and sticking with those types of approaches since day one and through this Budget and having fiscal discipline both will give confidence to foreign investors.
Q: The government\\'s effort at several programs, whether it is the Make in India program or the start up focus program is laudatory in many ways but often the FDI conversation comes down to taxation policy. I am going to come back to the tax question pertaining to the Budget in which they have said that in an effort to resolve the disputes around the retrospective amendments that were made and these are popularly known as the Vodafone like cases they have offered a settlement scheme if I may call it that whereby they have said we will allow you not to pay the penalty and the interest, just pay the tax outstanding and let us settle the matter for once and for all. I am curious to know whether you think that this is a feasible settlement offer. Is this going to achieve what India ought to be looking for which is closure to this matter after 6-8 long years of discussing it?
A: From what I have seen in the Budget at the high level, I am not sure there is going to be much closure. I am not sure that companies are going to be willing to concede the entire tax liability to get the issue put away, an issue that they obviously disagree with the government about. So, I am not absolutely confident that companies are going to say okay this is it, let us go ahead and settle everything and move on.
Q: So you are not sure this conciliatory effort will succeed at all?
A: We will have to see what companies do but I would expect that if they don\\'t believe they owe the tax liability paying at all and saying we are done isn\\'t going to be a reasonable solution for them.