20 things Jaitley changed in India through this budget

Income Tax investigators given more power & carbon traders get concessions

Budget 2017 : There were many things that Finance Minister Arun Jaitley said during his budget speech but there are many more that went unsaid. Here is a list of 20 things that could have a direct or indirect impact on your life:

• With regard to a foreign company, sale of leftover stock of crude oil in case of strategic petroleum reserve after the expiry of the agreement, subject to the fulfilment of certain conditions, shall not be liable to tax in India.
• In case of income arising from sale of carbon credit, a concessional tax rate of ten per cent will be given
• Government, foreign missions and state PSUs engaged in the passenger transport business will be exempted from Tax Collection at Source (TCS) provisions relating to purchase of vehicles.
• Conditions of special taxation regime for offshore funds under section 9A of the Income-tax Act has been modified. Now, maintenance of minimum fund size would not be necessary for the year in which the fund is being wound up.
• Income from Chief Minister’s Relief Fund or the Lieutenant Governor’s Relief Fund shall be exempted from tax.
• Certain entities like Investor Protection Funds, Core Settlement Guarantee Fund, Tea/Coffee/Rubber Boards, enjoying exemption from levy of income-tax under section 10 of the Income-tax Act, shall be required to furnish return of their income.
• In order to ensure timely filing of returns of income, it is proposed to levy a fee in case of delay in filing the return. Read more

Budget 2017 has sops for selling property but restrictions on buying

Holding period for long term capital gains tax brought down to two years from earlier three

Budget 2017 : Your tax liability would now be lower when you sell a house in the third year after purchase. You can now claim long term capital gains (LTCG), if you sell a house after holding it for two years from the date of completion. Earlier, one could claim LTCG only after a holding period of three years. The rate for LTCG tax usually works out to be lower compared to short term capital gains (STCG) tax.

LTCG is paid either at flat 10% or 20% after adjusting the property price for inflation. STCG is added to the income of the seller and taxed as per his income tax slab, which comes to 30% if the gains are Rs 10 lakh or more.

While announcing the move, Finance Minister Arun Jaitley said: “This move will significantly reduce the capital gain tax liability while encouraging the mobility of assets."

“The government seems to have made the changes to revive the property market that has suffered due to demonetisation,” says Rahul Garg, partner and leader direct tax, PwC.

Preeti Khurana, a chartered accountant with ClearTax, says that it was a surprise move to see the government giving sops for selling a house for a shorter holding period.

While the government has given relief for selling of property, it has brought down a benefit provided on buying a second house. The government has restricted the interest deduction for second home that buyers get under Section 24. Read more

Highways allocation stepped up to Rs 64,000 crore: Arun Jaitley

'For transport sector -- railways, road, shipping, govt provides Rs 2,41,000 cr,' Jaitleysaid

Budget 2017 : Finance Minister Arun Jaitley on Wednesday announced enhancing the outlay for National Highways by 11 per cent to Rs 64,000 crore for 2017-18.

Presenting the Budget in Parliament on Wednesday, Jaitley said, "In the road sector, I have stepped up the budget allocation for the National Highways from Rs 57,676 crore in the budget estimate of 2016-17 to Rs 64,000 crore in 2017-18."

"For transport sector, including railways, road and shipping, government provides Rs 2.41 lakh crore," he added.

Jaitley said 2,000 km of coastal connectivity roads have been identified for construction and development. This will facilitate better connectivity of ports and remote villages, he said.

"The total length of roads including those under the PMGSY built from 2014-15 to current year is about 1,40,000 km, which is significantly higher than the previous three years," Jaitley said.

He said 133-km roads per day were constructed under the Pradhan Mantri Gram Sadak Yojana (PMGSY) as against 73-km in 2011-14.

Budget relief to middle class, 5% income tax for Rs 2.5-5 lakh earners

However, earners in between Rs 50 lakh and Rs one crore will have to pay 10% surcharge

The Budget gave relief to on personal income tax front, mainly the salaried group in the middle class, by halving the tax to five per cent up to the income of Rs 5 lakh to ease the pains of demonetisation. However, those earning above Rs 50 lakh and up to Rs one crore will have to shell out additional 10 per cent surcharge.

The cut in the tax rate for the lowest slab will also save up to Rs 12,500 for incomes in other slabs, increasing disposable income of the middle class that can provide spur to the slowing down economic growth. The present super rich tax in the form of 15 per cent surcharge will remain for those earning income over Rs one crore.

The finance minister also put more money in the hands of small and medium enterprises by reducing the corporate tax rate to 25 per cent from the current 30 per cent for annual turnover up to Rs 50 crore. Ninety six per cent of companies which file returns come under this category.

Besides middle class and SMEs, the finance minister also addressed the concerns of foreign portfolio investors by exempting India-based funds them from the indirect transfer provisions. The government had put on hold the recent rules by the Central Board of direct taxes in this regard.

Budget 2017 News, India Union Budget 2017-18, Latest News & Stories, Live Updates, Headlines & Highlights for Budget 2017-2018 | Business Standard

Big relief to middle class! I-T rate for Rs 2.5 lakh to Rs 5 lakh annual income bracket halved to 5%

Govt to abolish Foreign Investment Promotion Board: Finance Minister

The Foreign Investment Promotion Board (FIPB) has been decided to be abolished, Finance Minister Arun Jaitley declared in his budget presentation on Tuesday.

While, the FIPB had the final say in approving Foreign Direct Investment (FDI) proposals in the country for long, its power has been systematically reduced under the current government. Most notably, back in June, 2016 the government had announced relaxed FDI norms in single brand retail, civil aviation, airports, pharmaceuticals, animal husbandry and food products.

It had allowed up to 100% FDI in defence through the approval route, 100 per cent FDI in food product e-commerce, 100 per cent FDI in greenfield pharma via the automatic route, 100% in browfield pharma — of which 74% will be through automatic route — 100 per cent FDI in scheduled airlines, and up to 49 per cent FDI in airlines through automatic route.

In the last two years, the government has brought major FDI policy reforms in a number of sectors, including defence, construction development, insurance, pension sector, broadcasting sector, tea, coffee, rubber, cardamom, palm oil tree and olive oil tree plantations, single brand retail trading, manufacturing sector, limited liability partnerships, civil aviation, credit information companies, satellites - establishment/operation and asset reconstruction companies.

Incoming FDI grew 27 per cent in the first seven months of the fiscal to $27.82 billion, from $21.87 billion a year ago. Manufacturing accounted for 41.5 per cent of the total equity inflows into the country during April-October, according to the Department of Industrial Policy and Promotion’s (DIPP) year-end review.

This happened at a time when the government made a fervent pitch abroad for ‘Make in India’ to make India a manufacturing hub of the world and generate large scale employment. Services, telecom, trading, computer hardware and software and automobiles were among the major sectors that attracted FDI during this period. Read more

• Big relief to middle class! I-T rate for Rs 2.5 lakh to Rs 5 lakh annual income bracket halved to 5%
• India Budget 2017-2018 | India Union Budget 2017-2018 News, Analysis, Budget 2017-2018 Highlights - Business Standard News
• Budget 2017 News, India Union Budget 2017-18, Latest News & Stories, Live Updates, Headlines & Highlights for Budget 2017-2018 | Business Standard

Budget highlights: Fiscal deficit target for 2017-18 at 3.2%

Allocation under MNREGA increased to 48,000 cr from Rs 38,500 cr; highest ever allocation

Here are the highlights of Jaitley's budget for the 2017/18 fiscal year that begins on April 1.

FISCAL DEFICIT

* The 2017/18 budget seeks to pursue prudent fiscal management to preserve financial stability.

*Fiscal deficit at 3.4%

*Revenue deficit stands reduced to 2.1% in Fy18

GROWTH

* Jaitley says India seen as an engine of global growth

DEMONETISATION

* Demonetisation "a bold and decisive measure", will make GDP bigger and lead to higher tax revenues - finance minister

* Hit to economy from government decision to outlaw high-denomination notes will be "transient", effects of demonetisation not expected to spill over to next year

* Pace of remonetisation has picked up and will soon reach comfortable levels

* Surplus money in the banking system will lower borrowing costs, increase credit flow

INFLATION

*Consumer price index inflation is expected to remain within the central bank's mandated range of 2 to 6%

SPENDING

* India to spend more in rural areas, infrastructure and poverty alleviation

* The government will continue process of economic reforms for the benefit of poor

* Allocation under MNREGA increased to Rs 48,000 cr from Rs 38,500 cr; highest ever allocation

*Dedicated micro-irrigation fund will b set up by NABARD to achieve goal of 'Per Drop More Crop'.Initial corpus will be Rs 5,000 crore

*Mission Antyodaya to bring 1 crore households out of poverty and to make 50,000 Gram Panchayats poverty-free: FM Jaitley

*Propose to double the lending target of Pradhan Matri Mudra Yojana and set it up at Rs 2.44 lakh crore for 2017-18: FM Arun Jaitley. Read more

• Budget 2017 : India Union & Railway Budget 2017 News, Live Updates, Result & Highlights

Budget speech to be delivered as per schedule: Govt sources

There had been some confusion over presentation of the Budget following the death of MP E Ahamed

Budget 2017 India : Government and Parliament secretariat sources said the Budget speech by Finance Minister Arun Jaitley would be delivered according to schedule on Wednesday.

Amid confusion over whether the Parliament would be adjourned following the death of sitting member of Parliament E Ahamed, sources said the Budget presentation would not be postponed. Ahamed, who was an Indian Union Muslim League Lok Sabha member and former Minister of State for External Affairs E Ahamed, passed away early morning on Wednesday.. He had suffered a cardiac arrest at the time of President Pranab Mukherjee's address to the joint sitting of Parliament on Tuesday afternoon.

Government sources said there was needless confusion about the issue. Usually, the House proceedings are adjourned if a serving member passes away. But sources said there was no rule to this, and this was only a convention.

The Lok Sabha, therefore, will meet and pay its respects to the departed soul but the Budget presentation will go on as per schedule. All that the government needs to do is get half dozen parties on its side even if the Congress and others might protest.

The Congress is likely to protest what it has alleged to be the intent to keep the news of Ahamed's passing away under wraps. On Tuesday midnight, Congress President Sonia Gandhi and other leaders reached RML Hospital to complain that Ahamed's family member were not being allowed to meet him. Ahamed was declared dead a couple of hours later.

Live Blog : Cabinet meeting on Budget ends, FM to present Budget shortly

Budget 2017 to try and ease pain from cash crunch

Budget 2017 to try and ease pain from cash crunch

Finance Minister Arun Jaitley will likely boost spending and ease back on cutting the deficit when he presents his fourth budget on Wednesday, as he seeks to lift growth hit by the government's drive to purge the economy of "black money".

Prime Minister Narendra Modi's surprise decision last November to scrap high-value banknotes worth 86 percent of India's cash in circulation has hit consumer demand, disrupted supply chains and hurt capital investments.

Jaitley will present the 2017/18 budget at 11 am (0530 GMT) to the lower house of parliament.

The finance ministry forecasts that growth could dip to as low as 6.5 percent in the current fiscal year to March, before picking up in the coming fiscal year to between 6.75 and 7.5 percent.

While opinions vary on how long the disruptions caused by Modi's crackdown on untaxed and illicit wealth will last, there is near unanimity among economists that Asia's third-largest economy needs a helping hand.

Arvind Subramanian, Jaitley's chief economic adviser, on Tuesday advocated slashing personal income tax and accelerating cuts in corporate tax rates. He cautioned, however, against pursuing debt-fuelled fiscal expansion.

Still, economists are pencilling in a federal fiscal deficit of 3.3 percent of GDP for 2017/18. That would be higher than the 3 percent pledged earlier but lower than 3.5 percent that the government has budgeted for the year soon to end.

"Expectations are running high for an expansive budget," said Radhika Rao, an economist with DBS Bank in Singapore.(Read more)

BUDGET LIVE: Budget on schedule, Arun Jaitley leaves for Rashtrapati Bhawan

Fiscal deficit in April-December hits 94% of budget target

Last year, fiscal deficit for the same period stood at 87.9%

Fiscal deficit in the first nine months of 2016-17 touched 93.9 per cent of the Budget target as against 87.9 per cent for the same period a year ago.

In value terms, the April-December fiscal deficit stood at Rs 5.01 lakh crore, or 93.9 per cent, Budget 2017 estimates (BE). The fiscal deficit stood at 87.9 per cent in the corresponding nine months a year ago, as per 2015-16 BE.

Fiscal deficit, the gap between expenditure and revenue for the entire fiscal, has been pegged at Rs 5.33 lakh crore, or 3.5 per cent of the GDP, for the financial year 2016-17.

As per data released by the Controller General of Accounts (CGA), tax revenue came in at Rs 7.52 lakh crore, or 71.4 per cent of the full-year BE of Rs 10.54 lakh crore.

Total receipts from revenue and non-debt capital of the government during the period read Rs 9.68 lakh crore or 67.1 per cent of BE.

The government's Plan expenditure during the fiscal came in at Rs 4.10 lakh core, 74.6 per cent of the full-year budget estimate. During the same period last year, it stood at 74.4 per cent.

The Non-Plan expenditure in April-December of 2016-17 was Rs 10.59 lakh crore, or 74.2 per cent, of the whole-year estimate.

The total expenditure (Plan and Non-Plan) was Rs 14.69 lakh crore, 74.3 per cent of the government's full-year estimate of Rs 19.78 lakh crore.

The revenue deficit during April-December stood at Rs 3.54 lakh crore, or 100.1 per cent of BE for 2016-17.

Budget 2017: Nearly 13 cr poor covered under social security schemes

Budget 2017 : Observing that financial inclusion was the key to poverty alleviation, President Pranab Mukherjee on Tuesday said close to 13 crore poor have been covered under various social security schemes of the Narendra Modi government.

Addressing the customary joint session of both houses of parliament ahead of the budget session, Mukherjee said the core of all government policies was inclined towards achieving welfare of the poor, Dalits, deprived, underprivileged, farmers, workers and the youth.

Enumerating various pro-poor schemes, Mukherjee said the government was guided by the philosophy of 'Antyodaya' (integral humanism).

"To take the banking system to the doorstep of the poor and the unbanked, the Indian Postal Payment Bank was started. An unprecedented 26 crore plus Jan Dhan accounts were opened for the unbanked," he said.

"My government is committed to providing shelter to every houseless poor household through the Pradhan Mantri Aawas Yojana," he said.

Mukherjee said that under the Deen Dayal Antyodaya Yojana, over Rs 16,000 crore have been made available to self-help groups (SHGs) in the current financial year while over Rs 2 lakh crore was provided through 5.6 crore loans sanctioned under Pradhan Mantri Mudra Yojana.

Staffing industry seeks resolution of tax woes in Budget

Wants TDS cut from 10% to 2%, and applied on commission earned, not on gross invoice value

Wants TDS to be cut from 10% to 2%, and applied on commission earned, not on gross invoice value

The staffing industry, representing companies such as Team Lease and Quess, wants finance minister Arun Jaitley to resolve the tax anomalies it faces, in the upcoming Budget 2017 India.

The Indian Staffing Federation says that its demand assumes significance since post-demonetisation it is the formal sector which will grow and the staffing industry will play a crucial role in that.

The industry represents contract hiring in organised industry done through tri-partite agreements -- between the company that is hiring, the person hired and the staffing industry.

The Federation said tax deducted at source (TDS) is imposed on the gross invoices received by its members from its client companies, whereas it should be on just the commission received by the staffing companies.

While this amount is adjusted later, it takes about a year to happen, creating cash flow problems for staffing companies, says Suchita Dutta, executive director of the Federation.

At the same time, the Federation said its members topped the list of India staffing firms, as per the recent report published by Staffing Industry Analysts. The report indicated that the Indian staffing industry was estimated to be worth Rs 27,000 crore in 2015 and is forecast to grow by 12 per cent in 2016 and 10 per cent in 2017.

When asked when there is cash flow problems, how come the industry is performing so well, Dutta said the results are based on top lines and not bottom lines. Read more

'Budget 2017 must focus on housing, infrastructure for pro-poor thrust'

Considering that the welfare of the poor and middle class is the priority area of the government and the assembly elections manifestos of all the major political parties centre around housing and urban development, this year's budget is expected to give a major thrust on real estate housing & infrastructure.

The Budget 2017 should be seen in the backdrop of a tough year for real estate and housing, with the problem of weak sales and high unsold inventory getting further precipitated by demonetisation. It's a matter of concern that the sale of housing units declined by 10 percent in the six month period ending September 2016.

This poses a major challenge to NDA government's flagship programme of 'Housing for All', as housing besides infrastructure, is a major booster to GDP especially in a slowdown economy and has a multiplier effect on allied sectors.

It's time to build on the foundation of structural and institutional reforms, addressing the vital issue of seamless implementation of key reforms like Real Estate Regulation Act (RERA), Smart Cities Mission, REITs (real estate investment trusts), GST and Bankruptcy Act and carry out the unfinished reform agenda of 'Ease of Doing Business and Single Window Clearance'.

As the government is rightly giving boost to affordable/low-cost housing for the success of its 'Housing for All' mission,the budget needs to come up with policy initiatives/incentives to give a fillip to affordable and low cost housing by way of direct benefits to home buyers, resulting in enhanced affordability.

In order to widen the scope of interest rebate on affordable housing,there's a need to enhance the 30 sq mtr area limit of houses, especially when the government has already broadened the scope of interest subsidy under Pradhan Mantri Awas Yojana (PMAY) by enhancing the loan eligibility limit from 6 lakh to 12 lakh by creating two additional loan slabs of 9 lakh and 12 lakh with interest subsidy of 4 percent and 3 percent respectively. Read more