Skillsprogrammetobenefitretailsector

The eyes of the entire nation were on the Finance Minister as she delivered the Budget 2021, a budget that had a lot riding on it considering all that happened to the country’s economy in the last one year. While the budget speech was economic in its length compared to last year, it’s content was potent in terms of what it delivered.

The retail industry was crippled during the lockdown. As the economy opens up, it is now slowly getting back on its knees. The Budget has several initiatives which touch all segments of the society – women, farmers, entrepreneurs, rural and urban consumers to help sustain the momentum of recovery and growth.

The positives for retail are the overall thrust on ease of doing business & compliance and infrastructure development.

There are a host of substantial announcements that will enhance logistics capabilities of retailers, which are welcome as retail is heavily dependent on easy movement of goods and people.

The good news is that while there is no significant change in income tax slabs for the salaried, no additional tax has been imposed either. Furthermore, the changes to how appeals and assessments are made will give a breath of relief from harassment for businesses.

Increase in Tax Audit Limit to Rs.10 crores from Rs.5 crores for those having less than 5% cash transactions will not only help small retailers but will also promote digital transactions.

The big push on spending is likely to provide a shot in the arm to key growth drivers. And though it is not evident at the outset, this budget does have the potential to trigger consumption to some extent, at the ‘bottom of the pyramid’.

The apprenticeship program has been a great source of skilled manpower to the industry and a big source of employment to the country’s youth.

The allocation of additional Rs 3,000 crore towards this program is a good move as the retail industry.

The Government has proposed to rewrite the definition of ‘Small Companies’ under Companies Act 2013. Now, companies with capital less than 2crore and turnover less than 20 crore will come under the ambit of small companies. This will greatly help small retailers by easing their procedural and compliance burden. RAI believes that the Government will soon amend the MSME Act to allow retailers to register as MSME so that retailers too can avail of all the benefits available to other MSME businesses. The extension of tax holiday is welcome news for retail startups and innovators.