Union Budget proposes to make it easier for retailers to do business

The Union Finance Minister, Arun Jaitley, has proposed in the Union Budget 2016-17 that the retailers keep their stores open all seven days. The Budget has also proposed to do away with procedural hassles for the retail sector and proposes model shops and establishments bill for states to adopt. This is being suggested to make it easier for retailers to do business and increase sales and employment. In the end it would bring in more money to the government coffers.

Kumar Rajagopalan, CEO, Retailers Association of India, says that ‘shopping malls as well as large retail shops at present work all days of a week, and they have to get separate permissions for that’.

If the stores stay open all seven days then they will have to increase the number of employees as staff holidays have to be taken care of. However, the good news will be generation of employment. As Rajagopalan points out, the proposal of seven days open would translate into more sales, more employment, customer convenience and increase of tax collection for the government. It would also support Make in India movement by helping better throughput from stores.

Also, the proposal for a model shops and establishments bill will help to simplify regulations and procedures that are needed to set up and operate retail shops. Presently, 40-50 licences and approvals from different government departments are required to open a store. Strangely, even stores opened in different cities in a state require a separate list of licences. Maharashtra and Andhra Pradesh have adopted Model Shops and Establishments Act (MSEA) and had made a recommendation on similar lines to the government. Under this Act, a nodal officer is appointed for single window clearance for the retail sector.