Union Budget 2022-23: A reduction of 18% GST levied on tech-based edtech enterprises is likely to attract learners from all strata
On 1 February, Finance Minister Nirmala Sitharaman will present the Union Budget for 2022-23. Members and representatives from all sectors and sections of the country wait with bated breath to see what vision and plan are presented for the $3.1 trillion economy.
The education sector is optimistic about Union Budget 2022. The education space has transformed significantly since the outbreak of the COVID-19 pandemic in 2020. In two years, the sector witnessed exponential growth driven by education technology that disrupted the traditional education system in the country.
In the education sector, the foremost expectation from Union Budget 2022 is a bigger allocation of funds for education and a reduction in taxation. The budgetary allocation for education in 2021 was Rs 6 crores lesser than that of 2020. With the prolonged effect of the pandemic necessitating renewed periods of e-learning, there is a pressing need to focus on nationwide accessibility.
The government has been emphasizing the setting up of National Digital Educational Architecture (NDEAR) and is focusing on the development of the country’s digital infrastructure for the implementation of NEP 2020.
Nevertheless, innovation and emerging tech-based EdTech enterprises continue to pay GST at 18 percent, unlike conventional school education, which has been excluded from GST. Reducing the taxation percentage will help offer affordable products and services, thereby attracting learners from various strata of society towards online education.
With new variants of COVID-19 disrupting normality, it is important for start-ups in the edtech sector to ramp up their efforts in promoting accessible, affordable, and scalable education. In a similar vein of contemplating about bringing regulations to edtech entities, the government must set up a fund to support small and mid-sized startups to continue their innovations. These startups can later work for various government missions and projects.
Additionally, the burgeoning edtech sector requires a regulatory body to make policy frameworks from time to time and to streamline the process for recognition of edtech products, solutions, and courses. The body could also play a crucial role in ensuring the quality of edtech-based education.
Building education infrastructure
NEP 2020 has proposed the integration of an online/hybrid model in higher education. Online and hybrid learning models have been widespread during and will continue to be so post-pandemic. However, slow network connections affect its effectiveness. Additionally, data charges are becoming costlier. The government must look at ways and means of providing access to a high-speed internet connection to everyone.
The BharatNet project needs to be expedited so that all nooks and corners of the country can have high-speed broadband connections. This will indeed help learners to attend online classes seamlessly.
Cyber risk is high when more people start using digital technologies. Given this, a powerful cybersecurity ecosystem is required to prevent threats. The Budget must allocate the required amount to build a sophisticated cybersecurity infrastructure. This is essential for all sectors, including education, especially when educational institutions are undergoing digital transformation.
Moreover, a Budget proposal and/ or government policy is required to clear the cloud on technology-driven digital universities. The finance minister must emphasise blockchain-backed automated university administration and record-keeping facilities to intensify its adoption in more institutions.
This year, the Union Budget is going to be presented when the third wave of coronavirus is gripping the country. All Indian states are taking strong measures to contain the virus while also not impacting the economy. However, the education sector was hit once again by the third wave of the pandemic. Therefore, the sector expects proactive government attention and measures to bring it back on its feet. More government support is required for higher education institutions and online educators to improve the gross enrolment ratio.
The author is Chief Business officer, UNext Learning- next-gen online learning organisation. Views are personal.