Union budget of 2017 acts as a salve for the commons who suffered during the period of demonetisation. It gives relief for the majority of taxpayers by halving the rate of personal income tax and provides a fiscal consolidation path. But Finance Minister Arun Jaitley increased the tax liability of the super-rich and gradually reduced corporate tax rates and phases out exemptions given to small and medium-sized companies.
This budget brought some relief to IT employees, who earns between Rs 2.5lakh and Rs 5 lakh by reducing the personal income rate to 5% from 10%. As per the new proposal, 10% surcharge for those with taxable income between RS 50lakh and Rs 1crore whereas those with above Rs 1crore continue to pay 15% surcharge.However the tax rates for the big corporates remains unchanged.
The main focus of 2017 budget:
- Spending in rural areas
- Infrastructure development
- Poverty alleviation
- Affordable housing has given ‘’infrastructure status’’.
- Instead of built up areas, carpet area of 30 and 60 sq. meters will be applicable for affordable housing.
- The Holding period for capital gains and tax for immovable property has been reduced from 3 years to 2 years.
- Real estate developers also get tax relief on unsold stock as liability and capital gains can be paid in the year when the project is completed.
- Highest ever allocation for MNREGA of Rs 48,000 crore
- Women participation in MGNREGA increased from 48% to 55%
- 1 crore households and 50,000 Gram Panchayat to be made poverty free by 2019
- Allocation for Pradhan Mantri Awas Yojana –Gramin increased to Rs 23,000 from Rs 15,000
- Main focus on Railways, Roads and Rivers
- Total allocation: Rs 3,96,135 crores
- Total capital and development expenditure : Rs 1,31,000 crores
- As part of Accounting Reforms, accrual based financial statements to be enrolled by March 2019
- Shares railway PSEs like IRCTC, IRFC, and IRCON will be listed in the stock exchange
- Service charge on e-tickets booked through IRCTC withdrawn
- Tariffs fixed, taking into consideration costs, quality of service and competition from other form of transports
- Allocation for highways : Rs 64,900 crore
- Total length of roads built from 2014-2015 till current year is 1,40,000kms
- No transaction is permitted above Rs 3 lakh in cash
- Setting up of the Payment Regulatory Board in RBI to replace for regulation and supervision of payment and settlement systems
- Political parties can receive a maximum of Rs 2,000 from a single person which is reduced from Rs 20,000
- A donor can purchase the issuance of electoral bonds from authorised banks against cheque and digital payment
- Political parties are asked to file its return within the given time
- It brings transparency in electoral funding
- To make MSME viable, income tax cut for companies with annual turnover of up to Rs 50 crore is 25%
- For startups time period increases at 3 years in the first 7 years of existence
- Allowance provision increased for non-performing asset from 7.5% to 8.5%
- Rs 10,000 crore for recapitalisation of banks
- Fixing a target of Rs 2,44,000 crores under Pradhan Mantri Mudra Yojana
- Launch of swim platform with 350 online courses, enables students to virtually attend the courses
- Pradhan Mandri Kaushal Kendras is to be extended up to 600 districts
- About 100 India Informational Skill Centers to be launched for those who seek job opportunities outside India
- Senior citizens will be provided Aadhar card mentioning about their health condition
- Two new AIIMS to come in Jharkhand and in Gujarat
- 28,000 arsenic and fluoride affected areas to get safe drinking water in next 4 years
- To double the income of farmers, the allocation to the agricultural sector is about 24% to about Rs 1.78 lakh crores
- Reforms in the agricultural produce marketing law along with growing coverage of the Pradhan Mandri Fascal Bima Yojana would push the agrarian growth
- Micro-irrigation fund of Rs 5000 crore with the NABARD.
- Proposed to set up 688 mini-labs in Kisan Vikas Kendras in the country to give a boost to the reforms in the agriculture sector.
- e-NAM (National Agriculture Market) would be linked to the commodities market to allow farmers access better prices for their products