Coronavirus is wreaking havoc on Global Markets, Economies, and our lifestyle. Countries are providing tax cuts, extending due dates to ease the disruption caused.
‘Coronavirus’, the Grim Reaper for markets… The Covid-19 Pandemic has created an avalanche effect on global markets. Since the outbreak, Global markets have witnessed a blood bath. Dow Jones, Nifty 50 and S&P 500 are few among many Exchanges that have dropped of 10% or more. So much so that BSE on 18th March closed at 29,000 points, the lowest in 3 years. There is a lot of chatter around economies heading towards a recession, as global markets continue the ‘bearish’ trend.
What does it mean for the Economy?… During the Spanish Flu of the early 1900s, India’s GDP was -10%. Surely we won’t witness a scenario like that again, but the $ 5 Trillion economy Goal seems something of a daydream as consumption isn’t likely to rise anytime soon. The economic situation might worsen even more as many Indian cities are halting work. Even sectors with a sizable contribution to the Economy like tourism, entertainment, and hospitality are coming to a standstill.
The FY is almost ending… India needs a coordinated fiscal action and monetary stimulus to overcome this crisis. India needs relief measures like tax rebates, debt repayment holidays, extended due dates and deferment for EMI payment.
Tax relief in this time of crisis… countries around the world are implementing emergency tax measures to support their economies under the Covid-19 threat. China has reduced its VAT from 3% to 1% and a few European countries have implemented major tax relief measures. Tax deferrals, income subsidies for affected workers, & debt repayment holidays are a few important measures. USA has extended the tax deadline by 90 days.
Tax-Relief is still emerging as an ‘option’ in many countries. But every country is trying its best to implement the best possible relief measures for its citizens.
What about our daily life?… In most countries, daily life as we know has come to a standstill. Let’s not forget the disruption Covid-19 has caused. More and more countries are in a Lockdown, people are told to self-quarantine and mass gathering has been banned.
And Finally, Stay safe… The Government has maintained that there is no evidence of community transmission of COVID-19. All the patients that have been confirmed have acquired the disease during their international travel.
Regardless, it is advisable to avoid public areas & keep washing your hands. Cover your mouth and noses while sneezing or coughing.
Spread awareness, stay safe and take individual responsibility!
“India is relatively insulated from the global value chain and to that extent impact on India will be less”
-RBI governor Shaktikanta Das