Big takeaways from Jaitley’s Budget – tax cuts & infra-push

RSTV Bureau
New Delhi: Finance Minister Arun Jaitley (C) stands outside his office at North Block holding the briefcase containing the Union budget for 2017 and is flanked by MoS Arjun Meghwal (R) and Santosh Gangwar (L), Feb 1, 2017. Photo - PTI

New Delhi: Finance Minister Arun Jaitley (C) stands outside his office at North Block holding the briefcase containing the Union budget for 2017 and is flanked by MoS Arjun Meghwal (R) and Santosh Gangwar (L), Feb 1, 2017.
Photo – PTI

 

FM on Taxes

  • Tax liability for individuals earning between ₹ 2.5 to ₹ 5 lakh per annum, reduced to 5 % from the existing 10 %
  • Zero tax liability for people earning up to ₹ 3 lakh per annum
  • Surcharge of 10% for annual incomes from ₹ 50 lakh to 1 crore per annum
  • 15% surcharge on incomes above ₹ 1 cr to continue
  • Companies with annual turnover of ₹ 50 lakh to get a 5% reduction in corporate tax
  • Tax on MSMEs (Ministry of Micro Small and Medium Enterprises) cut to 25%
  • Foreign investors exempted from paying tax on offshore funds with Indian assets

 

FM on Political Funding

  • Limit of cash donations to political parties reduced from Rs 20,000 to Rs 2,000
  • Parties entitled to receive donations by cheques or digital modes
  • RBI Act proposed amendment to enable issuance of electoral bonds
  • Donor and donee will get tax exemption on political donations provided tax returns are filed

 

FM on Affordable Housing

  • Affordable housing to be given infrastructure status
  • 30% increase in area of affordable housing
  • One crore houses for poor by 2019
  • Sops for affordable housing extended from 3 years to 5 years

 

FM on Demonetisation

  • Ban on general cash transactions above Rs 3 lakh
  • The pace of re-monetisation has picked up

 

FM on Agriculture

  • Agriculture expected to grow 4.1% in the current year with better monsoon
  • Coverage of Fasal Bima Yojna increased from 30% to 40%
  • Budget targets ₹ 10 lakh crore for farm credit
  • Budget provision for MNREGA increased from ₹38,500 to ₹ 48,000 cr, the highest ever
  • Participation of women in MGNREGA up to 55%
  • Total allocation for rural agriculture and allied sectors increased to ₹ 1, 87, 223 cr, up by 24 %

 

FM on FDI and Forex reserves

  • India abolishes the Foreign Investment Promotion Board (FIPB), the body which approves all inbound FDI investment proposals.
  • 15. 36% increase in FDI flows
  • Forex reserves at $361 billion in January
  • Forex reserves enough to cover 12 months

 

FM on Railways and Infrastructure

  • 3500 km railway lines to be built
  • No service charge on rail tickets through IRCTC
  • Rail safety fund with corpus of Rs 100,000 cr over 5 years
  • New metro rail policy soon to encourage private participation
  • Total allocation for infrastructure for 2017-18 stands at ₹ 3,96,135 crore

 

FM on Expenditure and Fiscal Deficit

  • Fiscal deficit for 2017-18 pegged at 3.2 percent of GDP
  • Total expenditure of government in2017-18 pegged at 21.47 lakh crore

 

What’s become Expensive

  • Cigars and cheroots as excise duty on them hiked to 12.5 %
  • Pan masala and raw tobacco as excise duty on them has been increased