Softening the demonetisation blow, the Budget for 2017-18 on Wednesday halved the tax to 5 per cent on incomes up to Rs 500,000 but proposed a new surcharge of 10 per cent on incomes between Rs 50 lakh and Rs 1 crore and raised duties on cigarettes and pan masala while stepping up allocations for infrastructure, rural, agriculture and social sectors.
Following are the highlights of Union Budget 2017-18, presented by Finance Minister Arun Jaitley in Parliament on February 1:
- Tax rates halved to 5% for income of Rs 2.5-5 lakh, tax slabs unchanged
- 10% surcharge on people earning between Rs 50 lakh-1 cr
- 15% surcharge on annual income above Rs 1 cr to continue
- Cash transactions above Rs 3 lakh to banned
- Corporate tax for SMEs with turnover up to Rs 50 cr cut to 25%; 96% companies to benefit
- Customs duty of LNG halved to 2.5%
- Fiscal deficit pegged at 3.2% next year, 3% in FY'19
- Political parties barred from accepting cash donation beyond Rs 2,000 per individual
- They can receive donations via cheques, electronic mode; electoral bonds to be issued by RBI
- Aadhaar-based health cards for senior citizens; a scheme for them to ensure 8 pc guaranteed returns
- FIPB to be abolished; further FDI policy liberalisation
- Government to have time-bound procedure for CPSE listing
- Railway PSUs -- IRCTC, IRFC, IRCON to be listed
- Payment Regulatory Board to be set up within RBI to regulate digital payments
- Negotiable instruments Act to be amended to deal with cheque bounce cases
- Legislative changes to confiscate of assets of economic offenders who flee country
- Demonetisation bold, decisive measure; to help GDP growth, taxes mop up to rise
- Effect of demonetisation not to spill over to next year
- GST, demonetisation 'tectonic changes' for economy
- Service charges on e-tickets booked via IRCTC waived
- Capital expenditure of Railway fixed at Rs 1.31 lakh cr
- Rail safety fund of Rs 1 lakh cr over 5 years, unmanned level crossing to be eliminated by 2020
- Budget based on 3 agenda -- Transform, Energise, Clean India (TECIndia).
- 3-year period for long-term capital gains tax on immovable property reduced to 2 years; base year indexation shifted from April 1, 1981 to April 1, 2001
- Divestment target at Rs 72,500 cr, up from 56,500 cr
- Gross market borrowing pegged at Rs 6.05 lakh cr
- Duty exempted on POS machines and Iris readers for encouraging digital payments
- Tax benefits for Start ups to be for 3 out of 7 yrs
- FPI to be exempt from indirect transfer provision
- Integrated public sector oil major to be created to match global giants
- Direct Tax collection growth 15.8%, indirect tax 8.3%
- Total expenditure pegged at Rs 21.47 lakh crore
- Capital expenditure up 24%; to have multiplier effect
- Allocation to states hiked to Rs 4.11 cr
- FRBM Committee suggests Debt-GDP ratio of 60% by 2020
- Retail inflation to remain within 2-6 pc
- 2 new AIIMS to come up in Jharkhand, Gujarat
- Highest ever allocation of Rs 48,000 cr to MNREGA
- Farm sector to grow at 4.1% this fiscal, to double farm income in five years
- Farm credit target for next fiscal at Rs 10 lakh crore
- Fasal Bima yojana increased to 40% of crop area; raised to Rs 1.41 lakh crore in Kharif 2017 season
- Infrastructure investment pegged at Rs 3.96 lakh cr
- To double irrigation fund corpus to Rs 40,000 cr
- Infrastructure status accorded affordable housing
- Dairy processing fund with Rs 2000cr corpus to be set up
- Rs 1.84 lakh cr allocated for women, child initiatives
- Rs 1.87 lakh cr allocated to rural, agri, allied sectors, 1 crore houses by 2019 for homeless
- PM Awas Yojana allocation up from Rs 15,000 cr to Rs 23,000 cr
- 100% village electrification to be achieved by May 2018
- Rs 31,920 cr allocated for Scheduled Tribes, Rs 4,195 cr minority affairs, outcome based budgeting to start
- Road sector allocation hiked to Rs 64,000 cr
- Innovation Fund to be created for Secondary Education
- Allocation of Rs 2.41 lakh crore rail, road, shipping to create jobs, spur economic activity
- New metro rail policy to be announced
- New crude oil reserves proposed at Odisha and Rajasthan; to take strategic reserve capacity to 15.33 mmt
- India on cusp of digital revolution
- FDI increased 35 pc to Rs 1.45 lakh crore in H1 FY'17.
- 2 new schemes -- Referral Bonus for individuals, cashback for merchants -- under BHIM app soon
- Aadhaar enabled payment system for merchants shortly
- Bill on curtailing menace of illicit deposit schemes in offing
- Fiscal deficit for this fiscal at 3.2%, down from budget estimate of 3.5%
- FRBM Committee recommends 3% fiscal deficit for 3 years
- Rs 10,000 cr to be provided to banks for recapitalisation
- Trade Infrastructure for Export Scheme (TIES) to be launched next fiscal
- Simple 1 page form to be filled by individuals having taxable income of Rs 5 lakh
- Excise duty on cigars, cheroots hiked to 12.5% or Rs 4006 per thousand
- Excise duty on pan masala hiked to 9% from 6%; on raw tobacco raised to 8.3% from 4%
- Parts used for manufacture of LED lights to attract basic customs duty of 5% and CVD of 6%
- Solar tempered glass used for manufacture of solar cells/panels exempted from customs duty
- Customs duty on printed circuit board for manufacture of mobile phones hiked to 2% from nil
- Threshold for audit of businesses opting for presumptive income doubled to Rs 2 cr
- Under presumptive taxation for professionals up to Rs 50 lakh advance tax can be paid in one instalment
- Scope of domestic transfer pricing restricted to entities availing profit linked deduction
- Presumptive tax would be 6% for SMEs with Rs 2 crore turnover opting for digital payment, 8% for others
- MAT credit will be allowed to be carried forward for 15 years, as against 10 years at present
- Lending target under Mudra Yojana set at Rs 2.44 lakh cr
- Computer Emergency Response Team for Financial Sector to be established
- Extensive reach out programme for GST to be launched on April 1.
- India a bright spot in world economic landscape, to be engine of global growth.
Illustration: Uttam Ghosh/Rediff.com