Budget 2024: Can fiscal consolidation reassure investors and boost market sentiment?
Interim Budget or Vote-on-account. Industry experts believe the Narendra Modi Government should make favorable policies to promote stock market education and reduce taxes on capital gains to increase stock market participation and encourage economic growth. “In the past decade, the number of stock market participants has increased by nearly 100%.
With the increased internet, the market is also seeing good growth. The coming decades will bring the best timeline for investing in the market," said Arun Singh Tanwar, Founder and CEO, of Get Together Finance (GTF). Stock market education should be promoted.
According to Arun Singh Tanwar, the financial literacy rate is not impressive in India currently. He added that the government should take more initiative and a good fraction of the money should be assigned to teach students the importance of personal finance and budgeting at a tender age. All the more, taxes on the capital gain of the stock market should be cut to create more involvement in the stock market.
A reduction in capital gains tax might have a substantial impact on investment behavior and encourage stock market participation. Lowering these taxes may encourage individuals to invest more actively, thus increasing market activity and liquidity. As a result, trading volumes may increase, encouraging economic growth and contributing to overall market expansion.
“Policymakers face a tightrope walk between fiscal rectitude and nurturing expansion. While investors desire discipline after pandemic excess, shock therapy through steep taxes or capex cuts has rattling effects. However modest infrastructure boosts alongside rationalization of non-merit subsidies signal positive intent.
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