Article: Budget 2024: HR leaders rally for tax incentives and skill development focus


Budget 2024: HR leaders rally for tax incentives and skill development focus

With a keen eye on tax incentives, skill development initiatives, and streamlined regulations, industry captains underscore the critical need for fostering digital transformation and workforce empowerment.
Budget 2024: HR leaders rally for tax incentives and skill development focus

As the interim budget is just two days away, human resource leaders want the government to prioritise the HRTech segment. Industry captains voiced their hopes for policies driving digital transformation in their sector along with their HR tech partners.

Tax incentive

HR tech companies are urging tax incentives to augment investments in advanced HR technologies like AI-driven talent management and employee engagement tools. They also call for initiatives fostering skill development aligned with emerging technologies to tackle evolving talent needs.

“An Interim budget holds significance as the country is buoyed by growth in recent stock markets to World Bank pegging India’s growth at 6.3%; India’s organised workforce of sixteen million has to be aligned with such growth. Urgent action is required to bridge the gap between outdated regulations and modern challenges, with automation as a crucial fulcrum for efficient adherence to labour laws. There is a necessity for a simplified regulatory framework, advocating for budget allocations to smart labour law compliance and incentivising research and development in HR and people compliance tech,” says Pratik Vaidya MD & CVO, Karma Global - a tech-enabled HR Staffing & Compliance Organization.

Budget for skill development

Job creation and equipping people with desired skills, especially in technology must be a focal point in the interim budget 2024.

Amit Mishra, CEO and founder, iMocha suggests setting a budget allocation to train people in things like artificial intelligence (AI), machine learning (ML), and cybersecurity as there is a big need for skilled people in these areas.

“Government funding for training will help young people get better jobs. The government and private companies should work together to train lots of people in skills for the future, like coding, AI, robotics, and other tech skills. In the last budget, the government focused on education that includes working while learning. This year, they are expected to focus even more on this,” adds Mishra.

Sharing his expectations on the interim budget 2024, Sandeep Chaudhary, CEO of PeopleStrong, says that technologies such as cloud-based solutions, Generative AI, and scalable IT infrastructure have a crucial role in shaping the trajectory of India’s HR industry. “The legislation must build policies and allocate more funds to match the pace of emerging new-age technologies as cyber threats remain a concern on a global level.”

Budget for IT hubs

Anshuman Das, CEO and Co-founder, Careernet, wants the government to enhance the infrastructure in Bangalore and similar IT hubs; otherwise, the entire IT industry in India may face challenges.

“Additionally, incentives for companies hiring and training freshers are vital to prevent wage inflation and maintain India's competitiveness. Rather than direct government spending on IT skilling, redirecting the budget through companies for more meaningful upskilling is recommended. Providing employees with direct tax breaks for upskilling and training expenses is crucial for continuous self-upgradation of the workforce,” says Das.

Employee welfare

Puneet Arora, Managing Partner, Biz Staffing Comrade Pvt Ltd expect measures from the upcoming interim budget 2024, mostly about employee welfare and taxation, the employment process, formal job creation opportunities, reducing compliance complexity, roll out of labour codes making them more adaptable to the modern workplace and addressing the skill-gap challenge in the country.

“The staffing industry plays a critical role in opening up employment opportunities, helping the organisation to build their business, developing a talent pipeline, and thus fuelling economic growth. Hence this industry deserves to be given industry status.”

Arora also expects fund allocation for a structured and comprehensive skilling programme.

Highlighting her concern, Sonali Chowdhry - CEO, Officenet, advocates for policies that aim to reduce compliance complexity and foster talent development.

"As we navigate the path towards AI dominance, a key expectation is robust support for Reskilling/Upskilling initiatives to empower our workforce for the challenges of tomorrow,” says Chowdhry.

Sharing key expectations from the interim budget 2024, Viswanath PS, MD & CEO, Randstad India, suggests that the government should announce a timeline for the issuance of income tax refunds. He is also vocal about a reduction in the TDS rate of Section 194R and PF contribution down to 5% from the current 12%.”

Policy for Workforce Development

Industry leaders like Sekhar Garisa, CEO, foundit expects the interim budget 2024 to provide strategic incentives and policies that support workforce development and skill enhancement. “Encouraging investments in upskilling initiatives will not only empower the workforce but also align the recruitment industry with the evolving demands of the digital era. Moreover, a budget that promotes technology adoption and innovation with sustainable options will be a game-changer. The strategy for realising this vision in the current economic agenda predominantly hinges on generating opportunities in emerging sectors like green industries, travel & tourism, and more.”

Tax benefits expected

At a time when most major companies have frozen their hiring plans and even laid off employees, industry leaders hope the interim budget 2024 will prioritise economic recovery. “We urge the government to announce more tax benefits or subsidies to boost job creation, fostering an environment that encourages companies to expand their workforce,” says Rahul Veerwal, CEO & Founder, GetWork.

Investment in skill development programs and education to ensure a skilled workforce for the future are other expectations of Veerwal who believes that the strategic allocation will not only address unemployment challenges but also align with the evolving needs of industries.

With talent acquisition and skilling at the forefront, HR tech companies are hoping for tax breaks on investments in recruitment platforms, employee training tools, and upskilling programs, says Ankit Aggarwal, Founder, and CEO of Unstop. This move would encourage companies to use HR Tech solutions and contribute to workforce development and quality.

Devrath Banerjee, Director, TresVista wants reforms to simplify and effectively implement labor laws, making them more adaptable to the modern workplace In anticipation of the interim budget 2024.

Initiatives to enhance employability 

As we approach the Union Budget 2024, it becomes imperative to prioritise initiatives that enhance employability and foster skill development, says Devashish Shamra, CEO and founding member of Taggd who wants focused initiatives and investment around outcome-based upskilling to address the shortage of skilled workforce.

To create more job opportunities, Sharma also calls for the government-led investment in digital infrastructure. 

Ecosystem for startups to thrive

Anil Agarwal, Founder and CEO at Incruiter, wants the upcoming interim Budget to be not just about economic reform but about having an ecosystem where start-ups can thrive, innovate, and contribute significantly to a thriving business environment. “In particular, the interim budget 2024 should include a unique opportunity to empower tech startups and small businesses by allocating dedicated funds for innovation and providing tax incentives for research and development.  Furthermore, the regulatory processes could be simplified to establish clear guidelines to encourage innovation. Moreover, a simplified compliance framework could lower complexity, foster talent development, and reduce administrative burdens to foster agility,” says Agarwal.

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Topics: Business, #Budget2024, #HRTech, #HRCommunity

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