No Changes in Taxation Rates
The budget did not propose any changes to existing tax rates for both direct and indirect taxes, including the retention of current import duties. This decision fell short of investors’ expectations for tax reliefs, leading to market disappointment
Aggressive Divestment Target
The government set a high divestment target of ₹50,000 crore for FY25, a 67% increase from the previous year’s revised target. This ambitious goal created uncertainty regarding the execution and potential impact on the stock prices of public sector enterprises slated for divestment
Lack of Major Tax Reliefs
Contrary to expectations, there were no significant tax reliefs or removals of Long-Term Capital Gains (LTCG) tax or Securities Transaction Tax (STT). This decision might have dampened market sentiment as investors had hoped for measures that would encourage equity investments
Withdrawal of Old Tax Demands
The budget proposed withdrawing outstanding direct tax demands up to ₹25,000 for the period up to FY 2009-10 and up to ₹10,000 for FY 2010-11 to 2014-15. While this move aimed to reduce taxpayer anxiety, its immediate impact on the broader market was limited
Focus on Capital Expenditure and Infrastructure
The budget emphasized long-term investments in capital expenditure and infrastructure development. While positive for the economy in the long run, this focus did not provide immediate relief to market participants looking for short-term gains, contributing to short-term market volatility