With the Supreme Court and Election Commission giving the go-ahead for advancing the presentation of the Union Budget to February 1, all eyes are now riveted on measures to soften the impact of demonetisation. The expectations are running high over possible cuts in corporate tax and personal income tax, besides some form of a bonanza for the poor and middle-class, who bore the brunt of the note ban. By ending the colonial-era tradition of presenting the Budget on the last working day of February, the NDA government has adopted a fresh and pragmatic approach to the exercise. The idea behind advancing the annual financial plan by nearly a month is to complete legislative approval for annual spending plans and tax proposals before the beginning of next fiscal on April 1. The traditional budgetary practice invariably causes a delay in releasing funds and grounding new projects. Both the apex court and poll panel did not see any merit in the opposition’s argument that its presentation just three days ahead of the Assembly elections in five States would amount to a violation of model code of conduct. The critics contended that it provides an undue advantage to the BJP as it can use budgetary exercise to lure voters by promising sops and new welfare schemes and sought its postponement till March 8 when the polling ends. Understandably, UP Chief Minister Akhilesh Yadav has also written to Prime Minister Narendra Modi seeking its postponement.
However, constitutional experts and former EC officials have opined that State elections, however important they may be politically, should not be allowed to hold up a central Budget as it pertains to the entire country. As a reasonable way-out, the EC put a caveat that the Centre should refrain from announcing any new schemes targeted at the poll-bound States of Uttar Pradesh, Uttarakhand, Manipur, Punjab and Goa. In a country where the political class finds itself in a perpetual state of electoral preparedness with polls becoming an annual feature in some corner or the other, the central Budget should not be held hostage to the election code restrictions. Being the first Budget post-demonetisation, it is expected to unveil initiatives to boost digital economy and incentivise cashless transactions. There is a strong expectation over policy initiatives to boost housing to make it more affordable to the common man. Farmers, small and medium entrepreneurs, who suffered the most due to cash crunch, are also eagerly looking forward to some relief. Finance Minister Arun Jaitley has a challenging task on hand to strike a delicate balance between populism and pragmatism as the economy has waded into an uncharted territory following demonetisation.