15 Highlights of Union Budget 2017
1)Reduction of Tax Rate: Argument is made that if nominal rate of taxation is kept at a lower slab, more people will prefer to come within the tax rate. Therefore the government has reduced the existing rate of taxes for individual assesses between the income 2.5- 5 lakhs to 5% instead of the present rate of 10%
2) Cash donation to political parties: The maximum amount of donation that a political party can receive will be Rs 2000 from any one source. The political parties will be entitled to receive donations by cheques or in the digital modes from their donors. A donor could purchase bonds from authorised banks against cheques and digital payments only. Every political party would have to file its returns within the time prescribed in accordance with the provisions of the Income Tax Act.
3) Ban on cash transactions above 3 Lakh: To curb black money in the economy, cash transactions above Rs 3 Lakh will not be allowed.
4) Amendment of Drugs and Cosmetic Act: Drug and cosmetic rules will be amended to ensure availability of drugs are reasonable prices to ensure the use of generic medicines, new rules regarding medical devices will be formulated. These rules will be internationally harmonised and attract investment into this sector. This will reduce the cost of such devices.
5) Farmers’ income double in 5 years: Farmers for whom the present government has promised to double their income in 5 years, the target for agricultural credit in 2017-18 have been fixed at a record level of Rs 10,00,000 Crore.
6) Some items become cheaper: Items like railway e-tickets, micro-ATMs, and fingerprint readers will be cheaper on governments digital payments push. Solar tempered glass used in solar panels and Liquefied Natural Gas will also became cheaper.
7) Some items become more expensive: Excise duty on unmanufactured tobacco will be doubled to 8.3%. Other tobacco related products like cigars, pan masala and cigarettes will also cost more. Price of items like roasted or salted cashew, circuit boards used in smart phones and RO membrane elements for household water filters will also increase.
8) Tax rate cut to 25% for small companies: In order to make MSNE (Ministry of Micro, Small & Medium Enterprises) companies more viable and to encourage firms to migrate to the company format, propose to reduce the Income Tax of smaller companies with an annual turnover upto Rs 50 Crore to 25%.
9) Innovation fund for secondary education: The government will set up innovative funds for secondary education. The fund will support local innovations and support the Startup India ecosystem. ‘Annual Learning Outcome’ system will be introduced in schools to improve the quality of education while focussing on science education.
10) 125 Lakh people adopted the Bhim App: India is now on the cusp of a massive digital revolution. A shift to digital platform has huge benefits to the common man. The Bhim App has been launched. It will unleash the power of mobile phones for digital payments and financial enclosures. 125 lakh people have adopted the Bhim App so far. A merchant version of Aadhaar enable payment system will be launched shortly. This will specially be beneficial to those who do not have debit cards mobile wallets or mobile phones.
11) Houses for homeless: The government will construct 1 Crore houses for the homeless and those living in kuchha houses by 2019.
12) Rs 1.1 Lakh Crore allocated for Railways: The first combined of Independent India that includes the railways also. For 2017-18 the total capital and development expenditure of railways has been pegged at Rs 1.1 Lakh Crore. This includes Rs 55,000 Crore provided by the government from the budget.
13) Reorientation of MNREGA to help farmers: Government has made conscious effort to reorient MNREGA to support the resolve of to double the farmers’ income. While providing at least 100 days employment to every rural household MNREGA should create productive assets to improve farm productivity and incomes.
14) GST council has finalised its recommendations: The preparatory work of the path-breaking reforms has been a top priority for the government, GST council has finalised its recommendations on almost all issues based on censuses and after a spirited debate and discussion the preparedness of the IT system of the GST is also on schedule.
15) Demonetisation seeks to create a new normal: Tax evasion for many had become a way of life. Demonetisation seeks to create a new normal wherein the GDP will be bigger, cleaner and real. Like all reforms this measure is obviously disruptive as it seeks to change the retrograde status quo.