The Indian Finance minister Nirmala Sitharaman presented the Union Budget 2023-2024 today (February 1). The focus on infrastructure development and green growth will boost the country’s economy in a sustainable manner. Enhanced capex for Rs 10 lakh crore has been allocated for infrastructure developments, which is 3.3% of the GDP. India’s economy is expected to grow by 7% in this fiscal. Considering the massive slowdown globally such a positive outlook means that F&B and lifestyle companies can expect strong domestic demand going ahead. The change in the individual tax regime with those with incomes up to Rs. 7 Lakh will now pay no tax is expected to boost the spending of the middle class.
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Vivek Gupta, Co-founder & Director, YourSpex by GKB Eyewear
The Union Budget 2023-2024 presented by the Finance Minister (Nirmala Sitharaman) is a growth-oriented one and highlighted that the Indian economy is moving ahead in spite of the global economic challenges. The FM announced an increase in the income tax rebate limit from ₹5 lakh to ₹7 lakh. I expect that the income tax exemption announced will spur consumer spending and help to boost revenue of many sector including eyecare indirectly. The government has proposed to extend the date of incorporation for income tax benefits to startups by a year from March 31, 2023 to March 31, 2024. The budget further proposed to provide the benefit of carry forward of losses on change of shareholding of start-ups from seven years of incorporation to ten years. This extension to the startup tax holiday policy will boost the entire startup ecosystem of the country.
Udit Bagga, Co-founder, OTB
Hearing our honourable Finance Minister announcing the Budget every year is always a pleasure. This year we found the focus was definitely towards the tourism sector; we are confident as growth in the tourism sector will directly reflect and help the hospitality industry to grow directly and indirectly. Speaking about entrepreneurship number of measures for start-ups have been taken this year again, and we are sure the results around the same are seen and will be seen around. We were hoping for a litter more on GST rebates or Input tax credit concerns, as it could have resolved many problems at large.
Vineet Tushir, Founder, Verandah
Nirmal Sitharam, Finance Minister of India, present the Union Budget 2023. We are glad to hear government focus around boosting the hospitality and tourism sector in the 2023 Union Budget. The budget definitely promotes tourism and small & medium enterprises. We are excited to hear the announcements as post-COVID. It definitely gives us a push to grow and explore more opportunities in the sector. If the GST rebate or Input tax credit concerns had been resolved, then things would have been better for us.
Dr Shruti Malik, Founder, Anardana
As a restaurant owner, I am heartened by the government’s focus on boosting the hospitality and tourism sector in the 2023 Union Budget. The measures aimed at improving infrastructure, promoting tourism, and supporting small and medium enterprises will greatly benefit businesses like ours. I am optimistic that these initiatives will lead to a revival of the industry, creating new job opportunities and driving economic growth. I am excited to see the positive impact these announcements will have on the sector in the coming months and years. what we expected from the upcoming Budget 2023 has not been done this year too, now that the restaurant industry has recovered to its pre-pandemic levels, restaurant owners pay a lot of GST and support the economy, but we don’t receive any kind of input tax credit for things like rentals, food purchases, and all other expenses incurred to run business. If the GST rebate or Input tax credit concerns would have been be resolved then things would have been better for us. In the upcoming years, we anticipate some encouraging outcomes. In addition, we aimed to have a single tax system this budget as we pay several VAT on Liquor and GST on food and that amount really is a waste of time and money. So we hoped this year, to have a straightforward taxation procedure and system, However this hasn’t been announced too. So overall for the industry nothing is planned. Overall apart from the hospitality sector the budget is very positive – this will lead to an overall growth of the country & encourage spending.
Sanjay Vazirani, CEO, Foodlink
I do personally believe that the tourism sector holds huge opportunities for jobs and entrepreneurship and measures taken to push domestic and international tourism will definitely help in the growth of hospitality industry. There are some tangible positives of tax relief measures for middle class and that signals that the government is cognizant of their challenges. The government has done fairly well with controlling inflation so far and they seem determined to continue with the same. In a short term, while the budget is not impacting the F&B sector greatly, I am glad to see that it has laid the road map for India’s green growth for cleaner future and uplift the youth of the country through upscaling and development programs.
Pradeep Shetty, President, Hotel and Restaurant Association of Western India (HRAWI).
The fact that Tourism got attention in the Union Budget is a big welcome. The Hon’ble FM recognized the country’s potential for domestic as well as foreign tourists and the huge opportunities the sector holds for jobs and entrepreneurship. The Hon’ble FM stressed on promoting tourism on mission mode, with the active participation of States, the convergence of Government programmes and public-private partnerships. This is especially good news for regional tourism and hospitality. Developing new airports, heliports, water aerodromes and advanced landing grounds to improve regional connectivity will unlock the vast potential for growth in the Western region of India. An integrated and innovative approach through challenge mode will be a game changer for the destinations in the Western region selected through this route. The Unity Mall initiative too is a great step in the right direction that encourages States to promote regional tourism and sale of their own ODOPs (one district, one product), GI products and other handicraft products. The Credit guarantee scheme for MSMEs with an infusion of Rs.9000 Cr into the corpus is expected to help small and medium-scale hotels and restaurants
Jaison Chacko, Secretary General, Federation of Hotel & Restaurant Associations of India (FHRAI)
It’s encouraging to note that the Union Budget has recognized the immense potential of the Tourism sector in the country to be tapped. The announcement of the Hon’ble Minister that promotion of tourism will be taken up on mission mode, with active participation of States, convergence of Government programmes and public-private partnerships is an extremely crucial announcement and the industry believes that this will benefit the sector in the long term. The Unity Mall, other tourism promotion initiatives through States and the development of 50 tourism destinations as a whole package will help in the growth of domestic as well as international tourism. Also, the announcement of additional airports, heliports, water aerodromes and advance landing grounds to improve regional connectivity is a great step. Like the Golden triangle, regional connectivity will give a major boost to the dedicated tourism corridors. This will help promote local tourism whilst giving a boost to investment in hospitality projects in the region. The industry is expecting appropriate allocation to be made to hospitality as per sector-specific planning envisaged by the Ministry of Tourism in conjunction with the industry. The enhancement of ease of doing business by reducing more than 39,000 compliances will also help to create a positive business environment. Lastly, the revamped Credit guarantee scheme for MSMEs with an infusion of Rs.9000 Cr into the corpus is expected to help small and medium-scale hotels and restaurants. The Hospitality industry’s long pending requests for Infrastructure status, uniform GST, and placing Tourism on the concurrent list of the constitution have not been met but the new announcements are positive signs of the Government’s intent about working on them in the near future.
Anurag Chhabra – Co-founder, Bevzilla coffee
The Union Budget 2023-24 does focus on a holistic development approach and showcases strong will to put the country on a roadmap to success. There is also a bright signal for the retail sector and the Indian ecommerce industry is expected to grow by 84%. The budget looks friendly and the innovation, digitisation and growth in the use of technology can be highly beneficial for this sector. The tax exemptions, simplified regulations, skill development and additional benefits can help in the long-term revival of the economy. The needs of the sector have been addressed to a greater extent and emphasises have been laid on goals that are sustainable. The government forces on building and boosting the startup ecosystem will not only help in newer innovations but also put us on par with the international standards. The number of recognised startups have already increased from 452 in 2016 to 84,012 in 2022 and will only grow further. There will be the emergence of the latest talent which will be an achievement for the country’s future.
Anuvrat Pabrai , Owner, Pabrai’s Ice Cream
We welcome the Budget 2023. The most significant proposal for us would be the extension of date of incorporation for startups by one year to 31.3.2024 to enable startups to avail of IT Tax holiday for 3 years. Also carry forward losses for new business would be permitted for 10 years instead of 7 years. Both are very beneficial for us.
Vishnu Sureka, Promoter, The Bhawanipur House
I think ever since this current government is making the budget this is the first time where a 360 degree approach taken to revive the fallen economy. More money in the hands of middle class is the best way to churn the money.
Teja Chekuri, Managing Partner, Ironhill India
We were hoping that in this budget, some critical issues such as the introduction of ITC (input tax credit), liquidity focused credit lines and single window clearance for all restaurant licenses will be looked into. It would have helped if the government would, have addressed the issue of unemployment in the hospitality sector and introduced healthy regulations in place to improve the ease of doing business and helped to generate employment in the sector.
Viren D’Silva, Co- Founder, GOOD FLIPPIN’ BURGERS®
It’s very good news for startups that Government has extended the tax holidays by one year, i.e, till March 2024. We were hoping the government would also increase the total turnover by Rs 50 cr from the earlier 25 cr. This would have been a booster dose for startups who were incorporated after 2017 and faced the tough time.
Vyom Shah, Founder, Foodism
With the government introducing new policies and incentives, the hospitality industry is likely to see an increase in investments and job creation. The policies include initiatives to promote tourism in India, which will help boost the sector’s growth post-coronavirus pandemic. Additionally, the measures to support small businesses could provide much-needed relief for those struggling with the pandemic’s economic effects. These changes should create a more competitive environment for hospitality companies and help them stay competitive in the future.