Budget 2024: Capital gains tax, climate change key concerns of Generation Z

Budget 2024: Young India is keen to hear announcements related to skill development for the youth, steps taken to counter climate change and reforms in the capital gains tax structure

With the Union Budget for 2024-25 round the corner, anticipation is mounting over the key announcements and reforms that will emerge from this annual financial exercise. Speculation is rife regarding potential adjustments to the direct income tax framework, a prospective reduction in the Goods and Services Tax (GST), a renewed emphasis on infrastructure development, the adoption of green technologies, and an enhancement of welfare subsidies, among other initiatives.

In a bid to dive deeper into these speculations and expectations, Business Standard recently spoke to members of Generation Z, the demographic cohort born between 1997 and 2012, and asked them what they wanted from the Narendra Modi government.

 

In response, young India said that they are keen to hear announcements related to skill training for the youth, steps taken to counter climate change and reforms in capital gains tax structure among other things.

Jatin Jangra, 26, Delhi

A 26-year-old assistant professor at Delhi University, Jatin Jangra believes long-term capital gains (LTCG) should be eliminated. 

As per the Indian taxation laws, LTCG is defined as the gains derived from the sale of an investment that was owned for longer than 12 months. This tax rule impacts stock market investments, which have seen significant interest from the younger generation in recent years. 

According to stock broker Angel One, the segment of investors younger than 30 years constitutes over 40 per cent of the Indian stock market participants as of May 31.

“STCG (short term capital gains) is fine and it should be increased because it is helpful in discouraging gambling in the stock market,” Jatin added.

Besides tax reforms, Jatin wants the old pension scheme to be restored. Additionally, he advocated for the constitution of the 8th Pay Commission, greater expenditure towards research, and a review of the controversial Agniveer scheme.

Arpita Chowdhury, 23, Delhi

Arpita wants the Centre to develop more comprehensive strategies for implementing green energy policies. She expressed hope about India’s steps to address climate change, noting the Centre’s focus on schemes like the National Hydrogen Mission. However, she pointed out that the penetration of these initiatives remains low. “Local accessibility and implementation remain a challenge,” she said.

Additionally, she recommended further infrastructure boost in the education sector. In the interim budget presented on February 1, Finance Minister Nirmala Sitharaman announced a record allocation for the education sector at Rs 73,498 crore.

“....robust skill-based employment generation programs are crucial. I anticipate continued emphasis on this sector, with a focus on completing ongoing projects and initiating new ones that will drive economic growth and create job opportunities for the youth,” the Delhi-based journalist added.

Arpita also called for the simplification of the capital gains tax structure to encourage broader market participation.

Manthati Sai Kiran, 22, Hyderabad

Manthati Sai Kiran, a student at Azim Premji University in Bangalore, pointed to the challenges within the academic space, emphasising the increasing impact of artificial intelligence and skill-oriented education for employment prospects. On his Budget expectations, he urged the Centre to consider reducing GST on purchases related to certificate courses to alleviate financial burden on the students.

“At present, an 18 per cent GST is levied on both online and offline certificate course purchases, making any reduction in tax a welcome relief for the student community,” Sai Kiran suggested.

He also expressed disappointment with the Centre’s decision to cut the interim Budget for the higher education department and advocated for increased funding and resources to align with the demands of the job market.

Tirthankar Das, 26, Kolkata

Tirthankar, a Kolkata-based journalist, highlighted the plight of the middle-class income groups amid rising inflation. 

“While our earnings remain stagnant, the costs of essentials such as fuel and emergency services (hospital and medical services) rise significantly,” Das said, adding that exorbitant housing prices further add to these struggles due to higher loan rates.

“Services across the nation should be structured in a way that they are affordable and within reach of all citizens... As prices continue to rise in every sector, the media industry, in particular, appears more neglected than others. Each year, my family, along with many others like ours, hopes for reduced prices of daily necessities to ease financial burdens,” he said.