The union budget 2015 is well intentioned and reformative, the initiatives will hopefully contribute to the e-commerce sector’s growth. There was good news for Indian entrepreneurs in finance minister Arun Jaitley’s budget 2015- 16 with the technology and startup sectors receiving allocations of Rs 1000 crores, promotion of cashless transactions via RUPay debit cards backed by major reduction in crporate tax from 30% to 25% over next four years.
According to Praveen Sinha, Founder and MD, Jabong.com, “Budget 2015 proved to be a good and mild budget and managed to create an air of euphoria in the nation. The budget provided the necessary thrust to the small and medium scale enterprises and equipped them with essential resources to grow their businesses. The move was in complete tandem with the government’s ‘Make in India’ campaign. Also decisions such as reduction in corporate tax will make India a competitive destination for investment. A big push to technology has been given by the government with its decision to reduce the tax on royalty and fees for technical services from 25% to 10% apart from setting up a ‘startup fund’ for technology based start-ups with an initial corpus of Rs 1,000 crore. However, judicial implementation of these funds would finally create a difference for the sector. I sincerely await how these funds are allocated in the long term.”
Sinha finds government’s decision to hike service tax rate to 14%, from 12.36% a disappointing move.
He further says, ” At the end of the day there are many other decisions such as reduction in excise duty in certain cases to promote domestic manufacturing once again will give boost to industries in India.”
Suresh Sharma, Founder & Director , iSpyPrice.com, a price comparison website says, “I am elated with Rs 1000 crore fund that has been allocated for start-ups, especially those that are technology-based. This announcement will encourage entrepreneurship and generate more employment opportunities in the sector. Also, the reduction in corporate tax from 30 % to 25% over the next four years is encouraging for e-commerce companies as low tax is equivalent to more inflow of cash. The promotion of cashless transactions through RUPay debit cards also works for the benefit of internet-based companies as this will reduce the propensity for Cash on Delivery, which is very high at present. Besides this, the tax reduction on royalty fees for technical services from 25% to 10% will make these services more cost-effective and bolster the operations of various tech-based firms.”
According to Ashish Sood , Co- Founder, Youshine, an omni channel fashion jewellery & accessories retail brand , “It is excellent that the Indian entrepreneurial system is being encouraged by the announcements of a start-up Fund of Funds and the special MUDRA Bank to take of MSME funding needs. Being a very young population, these measure will go a long way promote entrepreneurial activity in India.However, it is disappointing that GST implementation has been put forward by another 12 months. Retailers like us, who are looking to establish a Pan-India presence were really looking forward to this announcement.”
Finding the budget visionary and progressive, Suvro Ghosh Founder HelpMeDoc.in,a portal which serves to the healthcare needs online says, “Making current loans refinanced for MSME segment will let corporates think better and will help them create more jobs. It’s a huge temptation for expansion of the present MSME segment and to think differently. Reduction of corporate tax to 25% from 30%, shows a powerful vision. Social security, healthcare and insurance has been taken into consideration and this is commendable. An attempt to make transactions cashless to stop black money exchanges is a well-thought move. This step will reveal its real value, gradually, in the times to come. Overall, this has been a progressive budget, looking towards a modern India.”
Online travel networks that accounts for nearly 71% of e-commerce business in India are equally elated with the proposals on Visa on travel and reduction in the corporate tax.
Swaminathan Vedaranyam Chief Executive Officer, VIA.com says,”The Finance Ministers’ proposal to increase Visa on arrival scheme from the current 43 countries to 150 countries is a very welcome move as it will push the incoming to India dramatically which will in turn help the entire local eco system of India. It’s proposal to invest in heritage sites was a much awaited and extremely beneficial move as there was an urgent need for well-defined policies and clear commitments to ensure that all cultural heritage points are given more attention with improved infrastructural facilities. There is a recent spurt in domestic travel as well as a higher influx of foreign tourists in India and with dedicated upkeep of the tourist hotspots, we can ensure higher growth for the travel industry. The reduction on the Corporate tax is another major move that will help companies put aside more cash which can be be ploughed back into the business.”