Budget 2015 a fine balancing act: Girish Vanvari, KPMG in India

NEW DELHI: Calling Finance Minister Arun Jaitley's Budget 2015 a fine balancing act, Girish Vanvari, National Head of Tax, KPMG in India said, "The Budget boldly resorts to a higher fiscal deficit of 3.9% to enable provision for increased outlays on various rural initiatives, socio economic schemes, infrastructure needs and more so enhanced allocations to states as per the fourteenth Finance commission recommendations."

Budget 2015 comes in the backdrop of strong domestic macroeconomic fundamentals and soaring expectations, said Vanvari.

"As far as tax proposals are concerned, the Budget lays down a clear roadmap for implementation of GST and attempts to deal with Black money in a credible manner," Vanvari said. "Deferral of GAAR by 2 years and its applicability to investments made thereafter, reduction of tax rates for royalties and technical services to 10%, non applicability of MAT to FIIs, clarity on taxation of REITs, invits and AIFs are welcome steps," he added.

According to Vanvari, a roadmap for a futuristic tax regime of lower corporate rates and phasing out of exemptions over the next four years heralds an era of a transparent tax regime of no surprises.

Vanvari went on to say, "The lack of fiscal space did not permit meeting of the popular expectations of increase in slabs and housing interest deduction for individuals or abolition or reduction of MAT for SEZs and infra companies." "But all in a fine balancing inclusive futuristic budget," he concluded.