Any new tax in budget could hurt India's recovery, warn economists

Any new taxes in India’s budget would impede a nascent economic recovery, economists said, amid speculation that Finance Minister Nirmala Sitharaman could impose an additional levy on the wealthy to fund the government’s pandemic-related expenditure.
 

A so-called Covid cess shouldn’t be announced because the economy is still normalising after a strict and vast lockdown, Sonal Varma, an economist at Nomura Holdings, said on Thursday in a Q&A with Bloomberg. Abhishek Gupta of Bloomberg Economics warned that such a levy risks hastening capital outflows.

"The trend over the last few years has already raised the total taxes for high income earners to