‘New tax regime gives spending flexibility’

Congratulations on your fifth consecutive budget. You have mentioned that these five years have been the toughest times our country has faced but still we are right up there as a bright star. In this budget, you have put more money in the hands of employees, middle class. But will the employers be willing to pay them more?

 

Have you incentivized employers also to give more money? Finance Minister Nirmala Sitharaman: First of all, when you look at the economy, you can see that it is showing very clear signs of robust revival. When robust revival happens, and especially when you take the example of the services sector, the kind of attrition that sector is facing but at the same time because they are moving towards greater and greater use of technology, sophisticated technology, they are also seeking people with such skills. To pay better is also to pay better for people with the required skills and that's why the government of India, has in this budget, through various different ways underlined the importance of skilling, upskilling, skilling for industrial revolution 4.0. In that we placed specific emphasis because skilling is one thing, upskilling is there, but today the world is moving towards great use of Web 3. For that, if Industry 4.0 is coming up, employers will also pay more when you have people with the right kind of appropriate skills. We are spending that kind of money and bringing in that kind of training for people to be better paid.

So, the government is pushing it from a different supply side readiness, obviously that will have to be absorbed by the industry.

For the common people, the most striking thing about the budget is the new tax regime. What is the rationale behind that?