The sharp cut in corporate tax rate has triggered demand and speculation about more measures particularly on the personal income tax side. The government has a report of the task force on direct tax to chart out any future measures on the personal income tax.

The report was submitted to finance minister Nirmala Sitharaman last month and indications are that the government would want a discussion on the report before accepting the recommendations. Against the backdrop of the slowdown, suggestions have also been made by some experts to put on hold the super rich surcharge for sometime to boost sentiment but it is unlikely that a decision on this will be taken anytime soon.

Sources said that the slowdown offers an opportunity to push through deep structural reforms such as aggressive strategic sales in state-owned firms, asset monetisation in PSUs, structural reforms in the farm sector. They pointed out that some measures on structural reforms could be expected in the weeks to come.

The government on its part would wait and watch how the deep cut in corporate tax rate cut plays out. The view is that it will help drive away the negative sentiment and help revive the investment cycle which in turn will help drive demand.