India is a “bright spot” in the world economy, said Jaitley as he unveiled the annual budget.
Here are the highlights of Jaitley’s budget for the 2017/18 fiscal year
What Jaitley said
# India has emerged as 6th largest manufacturing country in world, up from 9th. We are seen as growth engine of world. We have moved from a discretionary administration to a policy-based administration.
# The focus will be on energising our youth, to reap benefits of growth and employment.
# Inflation which was in double digits has been controlled. Growth has been restored and measures taken against black money.
# Emerging market economies face three challenges: Fed rate hike, uncertainty of oil price, protectionism. International Monetary Fund estimates that the world GDP will grow by 3.1% in 2016 and 3.4% in 2017.
# Demonetization of high denomination notes was a bold and decisive measure. Pace of remonetization has picked up and will soon reach comfortable levels.
# India to spend more in rural areas, infrastructure and poverty alleviation. The government will continue process of economic reforms for the benefit of poor. “My approach in preparing the budget is to spend more on rural areas, infrastructure and poverty alleviation with fiscal prudence.”
# Total expenditure of Budget 2017-18: Rs 21,47,000 crore
# Abolition of non, planned expenditure will let us focus on capital and revenue expenditures
# Spending on capital expenditure increased by 25%, will lead to higher growth.
# Resources transferred to states and union territories – Rs 4.11 crore
# Defence expenditure excluding pensions – Rs 2,74,114 crore
# Railways will focus on passenger safety, capital and development work, cleanliness and financial reforms.
# Rail Sangh Raksha Kosh will be created with Rs 1 lakh crore over 5 years.
# Government will lay down timelines for implementation of safety measures.
# Railway lines of 3500 km in 2017-18 vs 2800 km in 2016-17.
# 500 stations will be made differently-abled friendly.
# 7000 stations will be powered with solar power in the medium term.
# By 2019, all coaches of trains will have biodegradable toilets.
# From Rs 57,676 crore allocation for construction of highways has been increased to Rs 64,000 crore in 2017-18.
# 2000 km coastal connectivity roads identified.
# Bharat Net Project allocation at Rs 10000 crore in 2017-18.
# High speed broadband connectivity will be available in 1.50 lakh gram panchayats.
# 250 proposals worth Rs 126000 crore received to set up electronics manufacturing units in the country. .
# Allocation for incentives to Rs 745 crore in 2017 – 18
# Total allocation for infrastructure – Rs 3,96,135 crore
# More than 90% of FDI inflows are through automatic route
# FIPB can now be phased out. It will be abolished in 2017-18
# The shares of Central Public Sector Enterprises will be listed on stock exchanges.
# Shares of railway entities like IRCTC, others, will be listed on various stock exchanges.
# Government will launch 2 new schemes to promote BHIM app usage
# Referral bonus schemes for consumers and cashback schemes for merchants
# Proposed to create a payment regulatory board in RBI.
# Head post office will render passport services
# India’s Tax to GDP ratio is very low
# 4.2 crore people in organised sector. Number of individuals filing salaried income only 1.4 crore.
# Out of 13.94 lakh companies registered upto March 31, 2014, 5.97 lakh companies have filed return.
# From 3.7 crore individuals who filed income tax, 99 lakh showed income below exemption limit, 1.95 lakh show income between Rs 2.5 lakh and Rs 5 lakh, 52 lakh people show income between Rs 5 lakh and Rs 20 lakh.
# Only 1.72 lakh people who filed income tax returns showed income over Rs 50 lakh
# Reduced existing rate of taxes for individuals Rs 2.5 lakh to Rs 5 lakh to 5% from 10%.
# Reduced tax liability below Rs 5 lakh either to zero with rebate or 50% of existing liability.
# Zero tax liability for up to Rs 3 lakh.
# All other taxpayers will get benefit of Rs 12,500 for all classes above Rs 5 lakh.
# 10% surcharge on income between Rs 50 lakh and Rs 1 crore.
# 15% surcharge over Rs 1 crore to continue.
# One-page return for Rs 5 lakh income
# No scrutiny for first-time taxpayers over high-value transaction.
# Carpet area of 30 and 60 sq metres will now be considered, which will raise the area by 30%.
# Eligibility Scheme tenure extended from three years to five years.
# Houses that are unoccupied after getting completion certificate are subject to tax on notional rental income. Propose to apply the rule only after one year to give them breathing time for liquidating inventory.
# Capital gains tax for land and building – holding period in long term is three years. This will be reduced to two years.
# Start-ups given income tax exemption with conditions for carrying forward losses with continuous holding of 51% voting rights has been relaxed if the promoter holding continues.
# Profit-linked deduction for three years of five changed to three years out of seven years.
# Minimum Alternative Tax (MAT) to be phasing out exemptions will kick in from April 1, 2017. Full benefit will only be available to government after seven to ten years.
# MAT credit can be carried forward by companies for 15 years.
# Proposal to limit cash expenditure for revenue and cash expenditure to Rs 10000.
# Cash which can be received by charitable institutions cut to Rs 2000.
# No transaction above Rs 3 lakh will be permitted in cash.