Budget 2017

Finance Minister Arun Jaitley presented the Union Budget for 2017-18 in the Lok Sabha. The Budget aims to regain financial stability after which dwindled after the demonetization.

The Union Budget 2017 is broadly focused on the following themes — farmers, rural population, youth, poor and health care for the underprivileged, infrastructure, financial sector for stronger institutions, speedy accountability, public services among others. The budget also holds significance due to its close proximity to the announcement of the demonetisation drive by Prime Minister Narendra Modi on November 8, 2016. However, FM said that the pace of remonetization will soon reach comfortable levels.

Below for the key highlights of the Union Budget 2017:

New Entrepreneur Opportunities And Financial Reforms

  1. Under the Affordable Housing scheme for profit-linked income tax deduction for promotionof affordable housingcarpet area instead of built up area of 30 and 60 Sq.mtr. will be counted. The 30 Sq.mtr. limit will apply only in case of municipal limitsof 4 metropolitan cities while for the rest of the country including in the peripheral areas of metros, limit of 60 Sq.mtr. will apply.
  1. For the purpose of carry forward of losses in respect of start-ups, the condition of continuous holding of 51% of voting rights has been relaxed subject to the condition that the holding of the original promoter/promoters continues. Also the profit (linked deduction) exemption available to the start-ups for 3 years out of 5 years is changed to 3 years out of 7 years.
  1. Lending target under Pradhan Mantri Mudra Yojana to be set at 44 lakh crores. Priority will be given to Dalits, Tribals, Backward Classes and Women.
  1. For Domestic companies having turnover less than 50 Crores in the previous financial year or new company to be taxed at 25% instead of 30%.
  1. Under scheme of presumptive income for small and medium tax payers whose turnover is upto 2 crores, the present, 8% of their turnover which is counted as presumptive income is reduced to 6% in respect of turnover which is by non-cash means.
  1. Miniaturised POS card reader for m-POS (other than mobile phones or tablet computers), micro ATM standards version 1.5.1, Finger Print Readers / Scanners and Iris Scanners and on their parts and components for manufacture of such devices to be exempt from BCD, Excise/CV duty and SAD.
  1. Second phase of Solar Park development to be taken up for additional 20,000 MW capacity.
  1. For creating an eco-system to make India a global hub for electronics manufacturing a provision of 745 crores in 2017-18 in incentive schemes like M-SIPS and EDF. 

Tax Reforms

  1. For builders for whom constructed buildings are stock-in-trade, tax on notional rental income will only apply after one year of the end of the year in which completion certificate is received.
  1. Reduction in the holding period for computing long term capital gains from transfer of immovable property from 3 years to 2 years. Also, the base year for indexation is proposed to be shifted from 1.4.1981 to
    1.4.2001 for all classes of assets including immovable property.
  1. For Joint Development Agreement signed for development of property, the liability to pay capital gain tax will arise in the year the project is completed.
  1. MAT credit is allowed to be carried forward up to a period of 15 years instead of 10 years at present.
  1. For Domestic companies having turnover less than 50 Crores in the previous financial year or new company to be taxed at 25% instead of 30%.
  1. Under scheme of presumptive income for small and medium tax payers whose turnover is upto 2 crores, the present, 8% of their turnover which is counted as presumptive income is reduced to 6% in respect of turnover which is by non-cash means.
  1. No transaction above 3 lakh would be permitted in cash subject to certain exceptions.
  1. Miniaturised POS card reader for m-POS (other than mobile phones or tablet computers), micro ATM standards version 1.5.1, Finger Print Readers / Scanners and Iris Scanners and on their parts and components for manufacture of such devices to be exempt from BCD, Excise/CV duty and SAD.
  1. Maximum Amount for cash donation to be received by Political as well as charitable trust/ society is Rs. 2,000.00.
  1. Commission payable to individual insurance agents exempt from the requirement of TDS subject to their filing a self-declaration that their income is below taxable limit.
  1. Time period for revising a tax return is being reduced to 12 months from completion of financial year, at par with the time period for filing of return.

For Individual Tax Payers

  1. Existing rate of taxation for individual assesses between income of 2.5 lakhs to 5 lakhs reduced to 5% from the present rate of 10%.
  1. Surcharge of 10% of tax payable on categories of individuals whose annual taxable income is between 50 lakhs and 1 crore.
  1. Simple one-page form to be filed as Income Tax Return for the category of individuals having taxable income upto ` 5 lakhs other than business income.

Rate of income tax for Individuals, HUF

Particulars Rate Of Taxes
where the total income does not exceed Rs. 2,50,000 Nil
where the total income exceeds Rs. 2,50,000 but does notexceed Rs. 5,00,000 5 per cent. of the amount by which the total incomeexceeds Rs. 2,50,000
where the total income exceeds Rs. 5,00,000 but does notexceed Rs. 10,00,000 Rs. 12,500 plus20 per cent. of the amount by which thetotal income exceeds Rs. 5,00,000
where the total income exceeds Rs. 10,00,000 Rs. 1,12,500 plus30 per cent. of the amount by whichthe total income exceeds Rs. 10,00,000

 

Job Opportunities For The Youth

  1. SWAYAM platform, leveraging IT, to be launched with at least 350 online courses. This would enable students to virtually attend courses taught by the best faculty.
  1. National Testing Agency to be set-up as an autonomous and self-sustained premier testing organisation to conduct all entrance examinations for higher education institutions.
  1. Pradhan Mantri Kaushal Kendras to be extended to more than 600 districts across the country. 100 India International Skills Centres will be established across the country.
  1. Skill Acquisition and Knowledge Awareness for Livelihood Promotion programme (SANKALP) to be launched at a cost of ` 4000 crores. SANKALP will provide market relevant training to 3.5 crore youth.
  1. Next phase of Skill Strengthening for Industrial Value Enhancement (STRIVE) will also be launched in 2017-18 at a cost of ` 2,200 crores.
  2. A scheme for creating employment in the leather and footwear industries along the lines in Textiles Sector to be launched.