Union Budget 2021: FMCG sector and offline organized players are looking for tax relaxation


The brick and Mortar Retail sector is the third-largest sector of the economy. This sector is very important because of the multiplier associated with economic activity. This sector creates direct and indirect employment for local people and acts as a booster for the local economy.  In the year 2020, consistent lockdowns and social distancing forced this sector to suffer heavy losses.

What are the expectations from Union Budget 2021?

Rationalization in the slabs of taxation is the primary concern of this sector because under the present circumstances most of the big players of small towns are finding it hard to difficult the fleet of employees.  Most of the big players in the FMCG sector are also expecting a relaxation in the direct taxes because of the heat that they are facing from the side of online players. Online players in FMCG conducted their business without any hindrances during the period of lockdown.

Most of the small and big players in the real world FMCG sector are now planning to introduce full-scale digitization in their operations. According to many merchants, full-scale digitization will help them in reducing the manpower and cut down the expenses to bring down the operational costs.

A relaxation in the tax structure will help these players in competing with the expansion plans of organized players that are hovering in the market by the virtue of big investments.

Union Budget can act as a power of balancing   

It is very important to understand the role of Union Budget 2021 as an agent of reforms for the unorganized and small retail sector of India. The synoptic outlooks associated with the economic activity do not acknowledge their presence because the economic activity undertaken by this sector is not measurable for the experts sitting at the helm of “Neeti Ayog.” However, its impact on the purchasing capacity of common men is very high, because of its multiplier in the field of employment.




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