Ashok Wadhwa, Group CEO, Ambit Holdings believes finance minister P Chidambaram has been trying his best to ease the fiscal deficit and is now making the Budget more realistic.
Below is the interview of Ashok Wadhwa with Latha Venkatesh of CNBC-TV18.
Latha: Your first thoughts?
He had limited canvas to maneuver and within that limited canvas he is trying to hit the big ticket items. He is trying to hit fiscal deficit ease; he is trying to budget a more realistic and a more contained fiscal deficit for next year. He understands the importance of manufacturing on one side and sustaining demand on other side and that is why the reduction on excise duty. If you think about it, the only place where he has made any tax cuts is on indirect taxes and that too on capital goods on one side and pretty much consumer durables on the other side. So, I would say he had limited ability to maneuver and within that he is trying to do whatever he can.
Latha: Chidambaram has not spoken anything about the taxes that were lapsing. The tax holiday for power companies as well for those hill states the excise duties. What should one go with, that they will be rolled over because he has not expressly said anything or because he has not expressly said, all those things lapse? How would you look at BHEL, clearly a victim if the tax holiday is not rolled over?
A: To the extent that there were specific dates provided in law on sunset clauses related to these tax concessions we have to assume that no new announcement in terms of even extending it through to the new Budget means that on March 31 these concessions lapse. Whether the new government that announces the Budget in July will not form a retroactive date re-implement these is a question mark at this point in time. However, unless the Budget in July contains specific legislations to say that there is an extension dating back to April 1 for present we have to assume that these clauses, the sunset clauses apply and the tax concessions will not be applicable from April 1.
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