The Union Budget for the year 2017-2018 was presented by Finance Minister Arun Jaitley in Lok Sabha on 1st of February, 2017. The budget was mainly focused on 10 themes, namely the farming sector, the youth, the population in rural areas, health care of poor and underprivileged, development of infrastructure, public services and tax administration to name a few.
The highlights from the Union Budget 2017-2018 are as follows:
The income tax rate for individuals with income between Rs. 2.5 Lakh to Rs. 5 Lakh has been cut down to 5 pc.
10 pc surcharge to be levied on individual income that is above Rs. 50 Lakh till Rs. 1 Crore. This is to make up for the loss of Rs. 15, 000 crore occurred due to the cut in the personal IT rates.
15 pc surcharge to be levied on income that is above 1 Crore.
7 Crore individuals have filed for tax returns in 2015-2016, out of which 99 Lakh individuals have shown income below the exemption limits.
Revenue deficit has been reduced from 2.3 pc to 2.1 pc for the year 2016-2017. The government also pegs the fiscal deficit target as 3.2 % for 2017-2018 and 3% for the coming year.
The government is to take more steps for the benefit of the farmers and the weaker sections. Finance Minister also confirms that the effects of demonetisation will not continue to the next year as the pace of remonetization has already been picked up. The income of farmers is expected to double in the next five years.
The Functional autonomy of Indian Railways will be maintained. The budget also focuses on a multi-modal approach towards the development of railways, inland water transport, and highways. The allocation of railway expenditure has seen an 8% hike with an expenditure of Rs. 1, 31,000 crores. Railway lines of 3,500km will be laid in the year 2017-2018.
Government to launch a scheme named “Sankalp” of Rs. 4,000 crores for skill development.
Union budget 2017 has shown emphasis on women empowerment. Setting up of Mahila Shakti Kendra’s will take place at the village level and the allotment made for the same by the finance minister is Rs 500 crore. Rs. 1.84 Lakh crore has been allocated for women skill development for the year
Proposal to construct 1 crore houses by the year 2019 for the homeless. The allocation for the PM Awas Yojana has been increased from Rs. 15,000 crore to Rs. 23,000 crore. The individual housing loans amounting to Rs. 20,000 crore will be refinanced by the National Housing Bank for 2017-2018.
Budget 2017-18 also focused on affordable housing. Carpet area to be considered instead of the build-up area.
Finance Minister also proposed the reduction of income tax for small companies which have a turnover of less than 50 crore to 25%.
Transactions above Rs. 3 Lakhs are not allowed in cash.
The Finance Minister has left the excise and the service tax unchanged and this kept the hopes alive and people are looking forward for the roll out of goods and services tax (GST) regime which might be announced in July 2017.
The Finance Minister also proposed to provide Rs. 2.44 Lakh Crore under the Mudra Scheme, which will prove beneficial for MFIs.
Sanitation coverage in rural areas and villages has been increased to 60 pc from 42 pc with a rise of 18 pc.
Proposal to provide drinking water to all those habitations that have been affected by arsenic and fluoride. The FM also confirmed that the electrification of villages (100 pc) would be completed by the year 2018 May.
The Finance Minister also announced that the scheme for senior citizens will ensure guaranteed returns of 8% and they will also be provided with Aadhar based health cards.
The Finance Minister, Arun Jaitley focused mainly on rural development. The Crop Insurance Coverage has been increased to 50% from existing 30% from 2017 till 2019. The MNREGA allocation too was hiked from INR 380 Bn to INR 480 Bn. Finance Minister also said that the Agricultural Sector would see a growth of 4.1 % this Fiscal.
The Union Budget 2017 showcased the government’s decision to stick to fiscal consolidation. The budget came during the time when the country’s growth was hit by the move of demonetisation.