The highlight of Budget 2019 is the higher tax on the super rich. From the perspective of resource mobilisation and social justice this cannot be faulted. But it has to be acknowledged that the tax incidence rising to 42 per cent on the super rich is very sharp.
The abolition of angel tax and interchangeability of PAN and Aadhar and 'faceless assessment' of tax assessment are positives.
The fiscal deficit target of 3.3 per cent is unlikely to be achieved. The disinvestment target of Rs 1.05 lakh crore is achievable and has to be strongly pursued. The proposal to raise public stake in listed companies is desirable but will face practical constraints in implementation in the case of some large-cap companies.
The crash in bond yields to around 6.66 per cent is the direct consequence of the proposal for raising sovereign debt from abroad.
The design and focus of the budget is in keeping with the focus of the Economic Survey. Going forward, follow-up policy initiatives based on the Economic Survey can be expected.