Govt's Latest Incentive for All Employees Reveal Its Desire for Boosting Economy, More Maybe in Offering
File photo of Union Finance Minister Nirmala Sitharaman addressing a press conference in New Delhi.
It is clear the government wants people to open up their wallets and spend more in the festive season. This is important for the green shooting of the economy as also reassuring the corporate sector that the government is doing its best to ensure that people have enough purchasing power.
Close on the heels of a Finance Minister Nirmala Sitharaman's decision to provide cash advance against LTC for central government employees, the government has come up with another major announcement.
Non-central government employees have been offered income tax exemption for payment of cash equivalent of LTC fare. The category of non-central government employees includes all those working in state governments, PSUs, banks and in the private sector.
The Finance Ministry had recently requested state governments to come up with a similar scheme or at least do enough to ensure people have money in hand.
However, barring Delhi, no other government was forthcoming and, hence, the Centre has on its own decided to bail out non-central government employees.
So far, sources say the response to the LTC cash advance scheme for the central employees has been encouraging and about 20% of them have sought the same. However, the government and corporate sector want more.
Sources say just ahead of Diwali, more such sops and incentives may be coming. The government may ask the private sector to ensure that employees are given bonus or salaries that may have been cut during lockdown are restored.
This means people would not be worried about expenditure and would open up their wallets. Sources say the government has also advised against big layoffs as this would put the fear in the minds of people.
With more opening up under the Centre’s ‘unlock’ plans and green shoots emerging, the government hopes that the Diwali would mean cheer and the diyas would continue to burn even after Diwali is over .