Friday, February 2, 2018

BUDGET 2018 _ HIGHLIGHTS

HIGHLIGHTS
Finance Minister Arun Jaitley presents his Budget for the year 2018-19 in Parliament. The budget is largely focused on uplift of agricultural sector, along with major push to healthcare and education sectors in the country. Stay with Times of India for latest updates


* PAN to be used as Unique Entity Number for non- individuals from April 1.

* Govt makes PAN mandatory for any entity entering into a financial transaction of Rs 2.5 lakh or more.

* This budget will accelerate economic growth, it is focused on all sectors: PM Modi


* Prime Minister Narendra Modi praises his finance minister Arun Jaitley for delivering a budget that is "farmer friendly, common citizen friendly, business environment-friendly and development friendly."

* Govt's health scheme to cover 10 crore poor families is world's largest government-funded health protection scheme.

* Arun Jaitley proposed to tax long term capital gains exceeding Rs 1 lakh at 10 per cent without indexation.


* Electronic IT assessment will be rolled out across the country, leading to greater efficiency and transparency: FM

* Mobile phones set to become costlier as custom duty on them has been increased to 20 per cent.

* Health and education cess has been increased to 4 per cent.

* For senior citizens, exemption of interest income on bank deposits raised to Rs 50,000: FM Jaitley

* FM Jaitley proposes to introduce tax on distributed income by equity oriented mutual funds at 10 per cent.

* Standard deduction of Rs 40,000 for salaried employees in lieu of transport and medical expenses: FM Jaitley


* Companies with turnover of up to Rs 250 crore to be taxed at 25 per cent: FM

* Arun Jaitley says that the government does not propose any changes in tax slabs for the salaried class this year.

* FM proposes a fiscal deficit of 3.3% of GDP for 2018-19.

* Finance Minister Arun Jaitley proposes revising emoluments as per the following structure:

-- Rs 5 lakh for the President of India
-- Rs 4 lakh for the Vice President
-- Rs 3.5 lakh for the Governors

* Jaitley also proposes automatic revision of emoluments of Parliamentarians every five years, indexed to inflation.


* We have already exceeded our disinvestment target, announces Arun Jaitley.
Disinvestment target for 2017-18 has been exceeded and will reach Rs 1 lakh crore. Target for 2018-19 is Rs 80,000 crore.

* 5 lakh WiFi hotspots will be set up in rural areas to provide easy internet access.

* Government will take all steps to eliminate use of cryptocurrencies which are funding illegitimate transactions.

* Govt announces Amrut program to focus on water supply to all households in 500 cities. Water supply contracts for 494 projects worth Rs 19,428 core will be awarded: FM


* NITI Aayog will establish a national programme to direct our efforts in the area of Artificial Intelligence towards national development: FM

* Airport capacity to be hiked to handle 1 billion trips every year.


* Arun Jaitley says that 4,000 km of new railway track will be laid down by 2019.

* All railways stations with footfall more than 25,000 to have escalators, says the Finance Minister.

* Mumbai transport receives Rs 40,000 crore.

* The government will undertake redevelopment of 600 major railway stations across the country.

* Arun Jaitley announces capital expenditure of Rs 1,48,528 crore for Indian Railways in 2018-19.

* National Heritage City Development Augmentation Scheme has been undertaken to preserve and protect heritage cities in the country, announces the Finance Minister.

* Government to contribute 12 per cent of EPF contribution for new employees in all sectors: FM

* Infrastructure is the growth driver of economy: Jaitley


* Target of 3 lakh crore for lending under PM Mudra Yojana: FM

* MSME enterprises are a major element for growth, says Jaitley. He also added that mass formalisation of MSME sector is happening after demonetisation and GST.

* Govt will launch health scheme to cover 10 crore poor families, Arun Jaitley says.

* The Government is slowly but steadily progressing towards universal health coverage: FM

* Government aims to bring 60 crore bank accounts under the Jan Dhan Yojana.

* Eklavya schools to be started for Scheduled Tribe populations: Finance Minister

* Rs 600 crore allocated to Tuberculosis patients undergoing treatment.

* Govt will set up two new Schools of Planning and Architecture, says Finance Minister Jaitley.

* To tackle brain drain, Jaitley announces scheme to identify bright students pursuing B Tech in premiere engineering institutes, and providing them higher-education opportunities in the IITs and IISc. These students will receive handsome fellowships, and will be expected to dedicate a few hours to teach in higher education institutions weekly.

* Specialised railway university to be set up at Vadodara.

* Jaitley proposed integrated BEd programme for teachers: "training of teachers during service is essential." Technology will be the biggest driver in improving the quality of education.

* Budget allocates money for social security and protection programme for all widows and orphaned children.

* We have a target to provide all Indians with their own homes by 2022, says Jaitley.

* Ujjwala scheme to amplify targets, will now provide 8 crore rural women free LPG connections.

* Air pollution in Delhi-NCR has been a cause of concern, govt has proposed subsidised machinery for in-situ management of crop residue in Punjab, Haryana, Uttar Pradesh and NCT Delhi.

* Govt of India will take necessary measures to put in place measures for the state government to purchase surplus solar power produced by local farmers at sutiable prices.

* Arun Jaitley proposes a sum of Rs 500 crore for 'Operation Green' on the lines of 'Operation Flood'.

* Food processing sector is going at an average of 8 per cent per annum.

* We have been saying it for years that India is primarily an agricultural country: Jaitley

* Arun Jaitley on Minimum Support Price of agricultural products: Only increasing the MSP is not enough, the government will fix the MSP of agricultural products at 1.5 times the market rate.

* Our emphasis is on generating higher benefits and productive employment for the farmers: Jaitley while addressing the agricultural sector in his Budget speech 2018.

* Our government has worked sincerely, and without weighing the political costs, hoping that benefits are delivered to people at their doorsteps. The Direct Benefit Transfer system of India is a success story that is reiterated across the world: Jaitley.

* This year's Budget will particularly focus on agriculture, says Jaitley.

* The finance minister also pointed out that India is one of the fastest-growing economies in the world.

* Indian economy has performed very well since our government took over in May 2014, says Arun Jaitley.

* Arun Jaitey recalls the measures -- like GST, FDI, demonetisation, etc. -- taken by the NDA government in the past four years that have impacted the economy of the country.


Budget 2018

Direct Taxes

The Budget 2018 updates with regards to direct taxation, had a plethora of initiatives:
  • INR 6.4 Lakh Crore total tax collection in FY 2014-15 has increased to INR 8.47 Lakh Crore total tax collection in FY 2016-17
  • Tax payer base has increased – 85.51 Lakh new tax payers who filed income tax returns in FY 16-17
  • INR 80,000 Crore disinvestment target to be set
  • 100% Tax Deduction to be provided to farmer producer companies with turnover of up to INR 100 Crore, for 5 years
  • Reduced Corporate Tax of 25% to be extended to companies with turnover of up to 250 Crore
  • Government to contribute 12% of new employee wages as part of EPF for next 3 years
  • New women employees’ contribution to EPF to be reduced from 12% to 8%
  • Personal income tax slabs to remain unchanged
  • Standard deduction of INR 40,000 to be re-introduced in lieu of the medical reimbursement worth INR 15,000 and transport allowance worth INR 19,200 which are currently available. Thus the net benefit will only be INR 5,800, which will reach over 2.5 Crore tax payers
  • Health And Education Cess to be increased from 3% to 4%
  • Host of tax benefits to be provided for senior citizens
  • Capital gains tax at 10% to be re-introduced on gains of over INR 1 lakh on long-term investments
  • E-assessment platforms to be rolled out across all touch-points to reduce human intervention

Indirect Taxes

This was the first budget to be presented in the GST era, and also probably the first budget with no substantial indirect tax component, as most of the initiatives were already being notified by the GST Council from time to time. Nevertheless, a few Budget 2018 highlights pertaining to indirect taxes, are as follows:
  • As per the budget news, the GST revenue shortfall is to be balanced by higher direct tax and disinvestment collections. Overall INR 21.57 Lakh Crore transferred as net GST to states as against projection of INR 21.47 Lakh Crore
  • GST compensation cess has been budgeted at INR 90,000 Crore for FY 18-19, while revised estimates for FY18 are at INR 61,000 Crore. The GST compensation cess funds are to be kept under public accounts
  • GST collections projection are pegged at INR 7.43 Lakh Crore in FY 18-19 as against INR 4.44 lakh Crore in nine months of the current fiscal
  • Central Board of Excise and Customs to be renamed as Central Board of Indirect Taxes and Customs
  • Excise Duty – As per the Budget 2018 highlights, the price of petrol and diesel has effectively come down by INR 2 per litre due to the cut in excise duty
  • Imports & Customs Duty – A social welfare surcharge of 10% has now been introduced on imported goods. In addition, the following rate changes were declared:
Increase in Rates ⇑Decrease in Rates ⇓
ItemOld RateNew RateItemOld RateNew Rate
LCD / LED / OLED panels, parts of TV7.5%15%Cashews5%2.5%
Smart watches, wearable devices, footwear10%20%Solar Tempered Glass for manufacture of solar cells5%Exempted
Mobile Phones15%20% –
Crude Vegetable Oils20%35% –
Refined Vegetable Oil15%20% –
Imitation Jewellery15%20%
In conclusion, Budget 2018 India Inc. was largely a pro-agriculture, pro-healthcare and pro-rural budget, which aims to improve the quality of life of the financially backward sections of the society. At the same time, as per the Budget 2018 highlights, the government will also be looking forward in terms of investment in modern fields – robotics, AI, block chain and cyber security, which will surely bolster the Indian economy in times to come.