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Budget 2023 emphasises economic growth through capital expenditure, all-around inclusive development, continuous policy and administrative reforms, a supportive business environment and a reduction in the tax outgo for individual taxpayers. It also strongly signals the global investment and business community by reiterating the government's position on containing the fiscal deficit.
The underlying theme of the tax policy has been consistency, certainty and predictability. Several initiatives in the fine print would further help businesses by reducing compliances, disputes and litigation.
The rationalisation of tax slab rates will benefit several taxpayers and further smoothen the process of moving to the optional (default) tax regime. Reducing the highest effective tax rate for high-income earners is an unexpected but welcome change and directionally positive.