The entire focus of the government is on increasing demand and consumption at this time. Therefore, she will try to put more money in people’s pockets by giving tax rebate.
The government has indicated in the economic survey to give relief to the people on the tax front. The survey said that the government should not worry about increasing fiscal deficit for faster growth. The government needs to take such steps that people can spend and demand increases.
If people save more money in their pockets then they will spend. There are indications that the government may also provide some relief on the tax front, so that people have more money left and it comes to the market as an expenditure. This will increase consumption and spending in the economy.
Government will adopt active fiscal policy
The survey says that a more active fiscal policy is needed to accelerate growth. Also, tax should also be exempted so that common people have more money left and it comes in the market as an expense. This will accelerate the economy. The government has indicated to give tax relief to the sectors most affected due to Corona. The survey said that Kovid-19 affected the manufacturing and construction sector the most.
Signs of tax relief to infrastructure companies
Analysts believe that the government took several steps to strengthen the economy during the last few months during Kovid-19. These include steps ranging from making loans for MSMEs to tax exemptions to corporate companies and advances to government employees.
The entire focus of the government is on generating demand in the market. Therefore, it can increase the slab of income tax of the people or give tax exemption as a relief. At the same time, it can also give big tax relief to companies investing in the infrastructure sector. This will increase employment.
Nidhi Malviya is fun loving girl. She writes at NoobFeeds about various topics related to Finance, Technology, Business etc.