Finance Minister Arun Jaitley presented the Union budget 2017-2018 in Lok Sabha. This is the fourth budget by the Narendra Modi government. There were lots of expectations from FM Jaitley to present a standout budget that would not just introduce a number of reforms, but also provide a lot of income tax exemptions to give relief to public in the wake of the inconvenience caused by Centre’s demonetization drive, leading to scrapping of Rs.500 and Rs.1000 currency notes. Arun Jaitley said that the demonetization move by PM Modi will not have a lasting impact on the economy.
“Madam Speaker, on this auspicious day of Vasant Panchami, I rise to present the union budget 2017-18,” Arun Jaitley said, as he stood to present the budget. “From favoritism to objectivity in decision making, from an informal to a formal economy, inflation in double figures has been controlled; we have launched a massive war against black money. The government is now seen as a trusted custodian of public funds, and I express gratitude to people for their strong support. Our Govt. was elected amidst huge expectations of people, the underlying theme of expectations being good governance. India has become the sixth largest manufacturing country in the world. The government has ensured fiscal consolidation without cutting back on public investments.”
Big bold figures from Budget 2017-18
- 5%: Income tax for people with incomes between 2.5 lakh -5 lakh, slashed from 10%
- 2,000: Maximum donation political parties can receive in cash from one source
- 35%: Increase in personal income tax because of scrapping of Rs. 500 and Rs. 1000 notes
- 25%: Tax rate for companies with an annual turnover of up to Rs. 50 crore
- 3 lakh: Maximum quantum of cash transaction allowed
- 17%: Growth in tax revenue
- 2%: Fiscal deficit as a percentage of India’s GDP
- 24%: Increase in rural spending
- 35%: Increase in funds allocation for scheduled castes
- 6%: Increase in defense spending
2017-18 Budget announcements in Brief:
- Those individuals in the tax bracket of Rs. 50 lakh will stand to benefit from a tax rebate of Rs.12,500.
- Jaitley reduces existing rate of taxation for individuals with income between the range of 2.5 lakh to 5 lakh is now 5% down from 10%; Surcharge of 10% for those whose annual income is Rs.50 lakh to 1 crore; Surcharge on Rs.1 crore or more remains unchanged.
- Basic customs duty on LNG to be reduced from 5% to 2.5%.
- Tax rate for companies with an annual turnover up to 50 crores to be reduced to 25%, to strengthen the MSME sector.
- The rate of growth in advance tax in personal income tax domains has increased by 34.81%, due to demonetization.
- For transportation, Coastal roads of 2,000 kms to quicken development of Coastal Economic Zones.
- 7 crore individuals filed tax returns, 99 lakh of them were below taxable limit. Number of people with more than 50 lakh income is 1.26 lakh, says Jaitley.
- Total funds being transferred to the states & union territories with the legislature is Rs. 4.11 lakh crore. Budget allocation for highways stepped up to Rs. 64,000 crore in FY18 from Rs.57,676 crore.
- Defense expenditure excluding pension at Rs. 2.74 lakh crore, says FM Arun Jaitley
- Arun Jaitley has announced that Head Post Offices will now be used as the front office for passport services.
- Forex reserves to offer a cover for 12 months of imports, announces Arun Jaitley.
New law to confiscate properties/assets of economic offenders fleeing the country.
- Railway tariffs to be fixed on the basis of cost, social obligation and competition. Railway related state-run companies like Ircon,IRCTC to be listed on stock exchanges, says Arun Jaitley.
- 125 lakh people adopted the BHIM app so far; merchant version of Aadhaar-enabled payment will be launched shortly for those without debit cards, mobile phones.
- Priority will be given to tribal, Dalit, women to setup Greenfield enterprises.
- Allocation for SCs increased from Rs.38,833 crore to Rs.52,393 crore.
- Transport sector allocated Rs.2.41 lakh crore and Bharat Net Project allocated Rs.10,000 crore.
- Total investment for infrastructure in budget 2017 stands at a record Rs.3,96,135 crore.
- Railways will integrate end to end transport solutions for selected commodities through partnership. By 2019, all coaches of Indian Railways will be fitted with bio-toilets.
- Good news for all those who book tickets on IRCTC. You will no longer have to pay service charge, announces Jaitley.
- 1.3 lakh crore has been allotted for solar power, disabled friendly stations. Rail safety fund with a corpus of Rs.100,000 crore to be created over a period of 5 years. Jaitley announces Rs.55000 crore for Railways in Budget 2017. Capital and development expenditure pegged at Rs.1.31 lakh crore for railways in 2017-18 from Budget.
- Focus is on swachh railways, says Jaitley. Steps will be taken to launch dedicated trains for pilgrimage and tourism, he says.
- Budget allocation for welfare of women and children under various ministries increased to Rs.1,84,632 crore.
- The government is looking to complete 1,00,00,000 houses by 2019 for houseless and those living in kaccha houses. Open defecation free villages will be given priority for piped water supply.
- SANKALP – Rs. 4000 crores allotted to train for market oriented training. At least 3.5 crore youth will be provided market-relevant training under Sankalp programme
- 100% village electrification will be achieved by May 1,2018
- Minilabs by qualified local entrepreneurs to be set up for soil testing in all 648 krishivigyan kendras in the country.
- Allocation for Pradhan Mantri Awaaz Yojana up from 15,000 cr to 23,000 cr
- Sanitation in rural areas has gone up from 42% to 60% now.
- PMGSY roads work accelerated to 133 km roads/day in 2016-17.
- Highest ever allocation for MNREGA at Rs. 48,000 crore. Participation of women in MGNREGA up to 55%.
- We will support Nabard for 63,000 functional PACs (Primary Agricultural Credit Societies), which will be done in 3 years at an estimated cost of Rs. 1,900 crore. Issuance of soil health cards has gathered momentum. Fasal Bima Yojana – 40% cropped area to be covered in 2017-18, 50% in 2018-19. Funds worth Rs.5,000 crore are to be set up for micro-irrigation under Nabard.
- With better monsoon, agriculture is expected to grow at 4.1%. The target for agricultural credit for 2017-18 is set at ten lakh crore.
The total expenditure of budget 2017-18 has been placed at Rs. 21.47 lakh crore, said finance minister Arun Jaitley. President Pranab Mukherjee termed the budget as “historic”. “When it comes to revenue exemptions, it is better to err on the right side,” he said. “In the last two years, I have restored the sanctity of the Budget. My revised expectations will be higher than the Budget estimates. I have been modest. But if we grow 12-14 percent, I will be happy. There will be more money.”