Budget presentation: FM has bumpy start but smooth sail later
1 Feb 2017 12:16 PM IST
BUDGET2017 POINTERS
* Total allocation for rural, agricultural & allied sectors for 2017-18 is a record Rs 1,87,223 crore, up 24 per cent from last year
* Total allocation for rural, agricultural & allied sectors for 2017-18 is a record Rs 1,87,223 crore, up 24 per cent from last year
* Target for agricultural credit in 2017-18 has been fixed at a record Rs 10 lakh crore
* Coverage of Fasal Bima Yojana to go up from 30 per cent of cropped area, to 40 per cent in 2017-18, 50 per cent in 2018-19
* NABARD to set up dedicated micro-irrigation fund to be set to achieve Per Drop More Crop mission
* Corpus of NABARD's long-term irrigation fund raised to Rs 40,000 crore
* Mini soil-testing labs in Krishi Vigyan Kendras to ensure 100 per cent coverage
* Highest ever allocation to MGNREGA at Rs 48,000 crore
*Merger of Railway Budget with Budget 2017 a historic step
* Transform, Energize and Clean India - #TECIndia - our agenda for the next year
* Advancement of budget will enable all ministries, departments to operationalize all schemes right from beginning of next fiscal
* Demonetisation aims to create a new normal, where the GDP would be bigger, cleaner and real
* Effects of demonetisation not expected to spill over to next year
* Firmly believe that GST, Demonetisation, built on JAM, will have an epoch-making impact on the lives of our people
* Demonetisation aims to create a new normal, where the GDP would be bigger, cleaner and real
* Recalls #MahatmaGandhi's words: A right cause never fails
* 3 challenges in current global scenario:Monetary stance of US FED Reserve, Commodity prices specially crude oil & retreat from globalisation-
* We have moved from a discretionary administration to a policy-based administration
* Expectations included burning issues like inflation and price rise, issue of corruption & crony capitalism
* Our government was elected amidst huge expectations of people, the underlying theme of expectations being good governance
* Hope to resolve all issues regarding GST via consultations
* We are moving from informal to formal economy & the Government is now seen as a trusted custodian of public money
* Five special tourism zones, anchored on SPVs, to be set up; Incredible India II campaign to be launched across the world
* Expert international assistance will be harnessed to improve railway safety preparedness and maintenance practices
* Allocation for infrastructure at record Rs 3,96,135 crore in 2017-18
* National Testing Agency to be established to conduct all entrance exams for higher education
* Innovation Fund for secondary education to be created
* Pradhan Mantri Kaushal Kendras to be extended to more than 600 districts across the country
* Mahila Shakti Kendras to be set up at village level, in 14 lakh ICDS centres, with an allocation of Rs. 500 crore
* Net tax revenue grew by 17 per cent in 2015-16
* Committed to making taxation rate reasonable, our tax administration more fair and expand the tax base of the country
* Pradhan Mantri Mudra Yojana lending target has been doubled at Rs 2.44 lakh crore for 2017-18
* 3,500 km railway lines to be commissioned in 2017-18 against 2,800 km in 2016-17
* Railways plan size for 2017-18 pegged at Rs. 1,31,000 crore, including Rs 55,000 crore to be provided by the government
* Using space technology in a big way to plan MGNREGA works
* During 2017-18, another 5 lakh ponds to be constructed for drought-proofing
* AadharPay, a merchant version of Aadhaar-enabled payment system to be launched shortly for those without debit cards, mobile phones
* Sanitation coverage in rural areas has gone up to 60 per cent
* Swachh Bharat Mission has made tremendous progress in promoting safe sanitation and ending open defectation
* By 2019 all passenger coaches of railways to be fitted with bio-toilets
* 1 crore houses to be completed by 2019 for houseless and those living in 'kacha' houses
* Rs 19,000 crore in 2017-18 for PMGSY; together with contribution from states, Rs 27,000 crore to be spent
* Total allocation for rural, agricultural & allied sectors for 2017-18 is a record Rs 1,87,223 crore, up 24 per cent from last year
* Target for agricultural credit in 2017-18 has been fixed at a record Rs 10 lakh crore
* Coverage of Fasal Bima Yojana to go up from 30 per cent of cropped area, to 40 per cent in 2017-18, 50 per cent in 2018-19
* NABARD to set up dedicated micro-irrigation fund to be set to achieve Per Drop More Crop mission
* Corpus of NABARD's long-term irrigation fund raised to Rs 40,000 crore
* Mini soil-testing labs in Krishi Vigyan Kendras to ensure 100 per cent coverage
* Highest ever allocation to MGNREGA at Rs 48,000 crore
*Merger of Railway Budget with Budget 2017 a historic step
* Transform, Energize and Clean India - #TECIndia - our agenda for the next year
* Advancement of budget will enable all ministries, departments to operationalize all schemes right from beginning of next fiscal
* Demonetisation aims to create a new normal, where the GDP would be bigger, cleaner and real
* Effects of demonetisation not expected to spill over to next year
* Firmly believe that GST, Demonetisation, built on JAM, will have an epoch-making impact on the lives of our people
* Demonetisation aims to create a new normal, where the GDP would be bigger, cleaner and real
* Recalls #MahatmaGandhi's words: A right cause never fails
* 3 challenges in current global scenario: Monetary stance of US FED Reserve, Commodity prices especially crude oil & retreat from globalisation
* We have moved from a discretionary administration to a policy-based administration
* Expectations included burning issues like inflation and price rise, issue of corruption & crony capitalism
* Our government was elected amidst huge expectations of people, the underlying theme of expectations being good governance
* Hope to resolve all issues regarding GST via consultations
* We are moving from informal to formal economy & the Government is now seen as a trusted custodian of public money
Budget presentation: FM has bumpy start but smooth sail later
It was a bumpy start for Finance Minister Arun Jaitley when he came to Lok Sabha today to present the Budget for 2017-18, with some Opposition parties seeking its deferment in view of demise of a sitting member E Ahamed.
While parties like Congress, Left and RJD insisted on adjourning the House as a mark of respect to Ahamed, leader of Indian Union Muslim League who passed away this morning, Speaker Sumitra Mahajan ruled in favour of Budget presentation today itself, saying it was a constitutional obligation.
Thereafter, it was a smooth sail even though members of Left parties staged a walkout. Some of them returned to the House soon after.
Trinamool Congress, which is angry over the arrest of its two MPs by CBI in connection with a scam, did not attend the Budget presentation. The party had earlier said that its members would not attend because of Saraswati Puja today.
Among other notable absentees were Congress President Sonia Gandhi, Samajwadi Party leader Mulayam Singh Yadav, Union Ministers Manohar Parrikar, Harsimrat Kaur and Maneka Gandhi.
Jaitley began his speech by saying that today is the auspicious day of Basant Panjami and that "spring is the season of optimism".
While presenting the Budget which included the merged Railway Budget, Jaitley spoke for nearly two hours, during which he sought to humour the House with Hindi quotations.
Presenting his third full Budget, Jaitley's various proposals, including on personal income tax and political funding, elicited applause from members who thumped their desks.
Prime Minister Narendra Modi was seen repeatedly thumping the desk as Jaitley read out various provisions of the Budget.
Quotations from Mahatma Gandhi, Swami Vivekananda as well as Hindi couplets peppered the Budget speech.
"Hum aage aage chalte hain aa jayee aap (We wil move forward follow us)," Jaitley said in an apparent reference to frosty relations with the Opposition, especially after the Winter Session was virtually washed out over demonetisation issue.
Clad in a light brown-hued kurta and a black Nehru jacket, Jaitley sat after around 20 minutes into the speech before getting up again to conclude the speech.
Taking on the critics of the government's decision to demonetise high value currencies, Jaitley quoted Mahatma Gandhi to say that "a right cause never fails".
"Kaale dhan ko bhi badalnaa padaa, aaj apna rang (Even black money had to change its colour today)," the Finance Minister said alluding to the measures taken to deal with illicit funds.
He described the merger of the Railways Budget with the General Budget as a "historic step".
When he spelled out measures to cleanse political funding, some BJP members asked the Opposition to thump their desks and a few seconds later. Congress leader Rahul Gandhi thumped his desk to support the move.
Congress members were seen protesting when Jaitley said that the government has made the highest increase in allocation for MNREGA.
Soon after adjournment of the House, the Prime Minister went up to Jaitley and shook hands with him.
Jaitley's family was sitting in the Speaker's gallery.Finance Minister Arun Jaitley today said the focus of his Budget for 2017-18 will be on 10 important sectors, including farmers, infrastructure, digital economy and tax administration to transform, energise and clean India.
The other areas of focus include rural India, the youth, poor and under-privileged, the financial sector, public service and prudent fiscal management.
"The government will continue with the reforms to boost economic activity," he said in his speech in the Lok Sabha while setting three main agenda of the Budget -- Transform, Energise, Clean India (TECIndia).
He also announced substantial increase in farm credit to Rs 10 lakh crore and "highest ever" allocation for MNREGA at Rs 48,000 crore.
Also, a long-term irrigation fund has been proposed to be set up in Nabard with an additional corpus of Rs 20,000 crore.
The Budget for 2017-18 is itself a reform as it merges rail budget with General Budget and replaces Plan/non-Plan expenditure classification with capital and revenue model to give a holistic picture of government spending.
Agri credit raised to record Rs 10 lakh cr in FY18
In a major thrust to agriculture, Finance Minister Arun Jaitley today announced a whopping Rs 1 lakh crore hike in the credit target for the next fiscal to Rs 10 lakh crore as part of the government's efforts to double farm incomes in the next five years.
"The target for agricultural credit in 2017-18 has been fixed at a record level of Rs 10 lakh crore," Jaitley said in his Budget speech.
The government will take special efforts to ensure adequate credit flow to underserved areas -- the eastern states and J&K, he added.
The government provides short-term crop loans up to Rs 3 lakh at subsidised interest rate of 7 per cent per annum. An additional incentive of 3 per cent is provided to farmers for prompt repayment of loans within due date, making an effective interest rate for them at 4 per cent.
The Finance Minister noted that the agriculture sector is expected to grow at 4.1 per cent during the current fiscal on good monsoon. Sowing of both kharif and rabi crops has been higher.
Jaitley said the allocation for new crop insurance scheme 'Pradhan Mantri Fasal Bima Yojana', which was launched last year, has been increased to Rs 13,240 crore this fiscal from budgeted Rs 5,500 crore. The allocation for the next fiscal has been earmarked at Rs 9,000 crore.
"The coverage of this scheme will be increased from 30 per cent of the cropped area in 2016-17 to 40 per cent in 2017-18 to 50 per cent in 2018-19," he said.
The finance minister said that dedicated micro-irrigation fund will be created with a corpus of Rs 5000 crore.
Stating that dairy is an important source of additional income for farmers, he said the government will set up a dairy processing fund of Rs 8,000 crore over three years with initial corpus of Rs 2,000 crore.
Jaitley also said the government will prepare a model law on contract farming which will be circulated to state governments.
Jaitley announces Rs 2,74,114 cr for defence
Union Finance Minister Arun Jaitley on Wednesday announced an allocation of Rs 2,74,114 crore for defence, excluding pensions.
"For defence expenditure excluding pensions, I have provided a sum of Rs 2,74,114 crore including Rs 86,488 crore for defence capital," Jaitley said delivering his Budget speech for financial year 2017-18.
To reduce the grievances of defence pensioners, Jaitley announced creation of web based interactive pension distribution system for defence pensioners, and said, "This system will receive pension proposals and make payment centrally. This will reduce the grievance of the defence pensioners."
To end the hassle of booking railway tickets for service personnel, Jaitley announced an online tickets booking system, and said, "They do not have to face the hassle of standing in the queues with the railway warrant."
Budget to thrust growth, transparency: Jaitley
Finance Minister Arun Jaitley said on Wednesday the Union Budget for 2017-18 will push growth, promote digital economy and bring transparency in political funding.
"The thrust in budget is stimulating growth, affordable housing, curbing black money, promoting digital economy, bringing transparency in political funding," Jaitley said, presenting his Budget in the Lok Sabha.
Rs 2,000 is maximum cash donation to political party by individual: Jaitley
Stressing the need for greater transparency in political funding, Finance Minister Arun Jaitley on Wednesday said the maximum amount of cash donation by an individual to a political party could be Rs 2,000 -- a sharp drop from the Rs 20,000 amount in cash earlier.
Presenting the Union Budget for 2017-18, Jaitley said political parties can take donations from donors through cheque and digital payments.
"Maximum amount of cash donation to any political party will be Rs 2,000 from any person," Jaitley said.
He said as an additional step, the government proposes to amend the RBI Act for issuing electoral bonds.
He said donors can purchase the bonds through cheques and these will be redeemable in the registered account of a political party.
"This reform will bring greater reform in political funding while preventing future generation of black money," Jaitley said.
Centre raises CLSS loan tenure to 20 years
The Centre today approved extension of tenure of loans under Credit Linked Subsidy Scheme (CLSS) of Pradhan Mantri Awas Yojana (PMAY) to 20 years from 15 years and introduction of a new CLSS for middle income group with a provision of Rs 1,000 crore in 2017-18.
"The Union Cabinet chaired by Prime Minister Narendra Modi has given ex-post facto approval to the proposals for extension of tenure of loans under the CLSS vertical of Pradhan Mantri Awas Yojana (Urban) Mission from 15 to 20 years," said an official statement.
According to the statement, the scheme will be renamed as CLSS for EWS/LIG -- for economically weaker sections (EWS) of society/Lower Income Group (LIG).
Besides, the Cabinet approved the introduction of a new Credit-Linked Subsidy Scheme for the Middle Income Group (MIG).
The government has proposed to construct 1 crore houses for the homeless by 2019. The PM Awas Yojana allocation has been raised to Rs 23,000 crore, from Rs 15,000 crore.
The government has also allowed primary lending institutions (PLIs) that have signed MoU with central nodal agencies (CNAs), under the CLSS vertical of PMAY (Urban) (now CLSS for EWS/LIG), the option to extend the mandate of their MoU to CLSS for MIG with appropriate changes as applicable.
It also cleared the proposal for rationalising or introducing the processing fees payable to the PLIs for the loans sanctioned under these schemes.
The government has allocated Rs 1,000 crore initially in the Budget for 2017-18 at the BE (budget estimates) stage for the proposed CLSS for MIG. It also approved issuance of operational guidelines for CLSS for MIG with approval of the minister-in-charge.
The objective is to increase the off-take in EWS and LIG segments under the existing Pradhan Mantri Awas Yojana (Urban) Housing for All Mission and reach out to MIG.
Besides, it will make procedures easy for PLIs and provide an incentive to them for higher participation in the housing and urban development sector.
The scheme will make available funds through budgetary provisions and clearly define the procedure and implementation of the programmes.
The outreach will ensure greater participation among the EWS, LIG and MIG segments to provide Housing for All by 2022, ensuring equity and inclusiveness.
The interest subsidy to be disbursed to the beneficiaries will be credited to their home loan accounts after the PLIs have satisfied the eligibility criteria through due diligence.
The proposed interest subsidy scheme for MIG is an innovative approach to address the needs of housing of this category, it said.
Demonetisation bold, decisive step; to boost economy: Jaitley
Terming demonetisation as "bold and decisive" measure, Finance Minister Arun Jaitley today said it will have a multiplier effect on the economy and will create bigger, cleaner and real GDP.
"We are moving from informal to formal economy and the government is now seen as a trusted custodian of public money," he said while delivering the Union Budget 2017-18.
Demonetisation was a bold and decisive strike in a series of measures to arrive at a new normal of bigger, cleaner and real GDP, he said, adding that it has only a transient impact on economy and the long term benefit include higher GDP growth and tax revenue.
On November 8, 2016, the government had announced demonetisation of old Rs 500 and Rs 1000 notes to crack down on black money and move towards a 'less cash' society through digital payments.
Jaitley said the government has taken a series of measures to eliminate black money and curb corruption and demonetisation was a step in that direction.
Demonetisation will help in transfer of resources from tax evaders to government, he said.
He further said that the pace of remonetisation has picked up and the situation will soon normalise.
Expressing hope that there will be no spill over effect of demonetisation next fiscal, the Finance Minister said the surplus liquidity in banks will lower the borrowing and the lending rates.
The government would continue with the economic reforms for benefit of poor, he added.
Rs one lakh crore for railway safety fund: Jaitley
Union Finance Minister Arun Jaitley on Wednesday announced creation of a Railway Safety Fund of Rs one lakh crore over a period of five years.
"A Railway Surksha Kosh (Rail Safety Fund) with a corpus of Rs 1,00,000 crore to be created over a period of five years," Jaitley said while presenting the Union Budget 2017-18.
He also said that Railways will get Rs 1,31,000 crore for capex and development expenditure in 2017-18.
The Finance Minister said that Railways will eliminate all the unmanned level crossings by 2020.
Emphasising on Clean India, Jaitley said, "A SMS based service has been started named 'Clean My Coach' by the Railways. And all the trains would be fitted with bio-tiolets by 2019."
The Finance Minister also announced to waive off service charges on Railway e-tickets.
"Steps will be taken to launch dedicated trains for pilgrimage and tourism," Jaitley said.
The Finance Minister also said that the railways will develop 25 selected stations while over 500 railway stations would be made disabled friendly with elevators, escalators.
"About 3,500 km of railway track would be laid down in this financial year," Jaitley said.
National Testing Agency for higher education entrance: Jaitley
Finance Minister Arun Jaitley on Wednesday announced setting up an autonomous National Testing Agency for conducting entrance exams to higher education institutions.
"We propose to set up a National Testing Agency as an autonomous and self-sustained premier testing agency to conduct all entrance exams to higher education," Jaitley said presenting the Union Budget 2017-18 in the Lok Sabha.
"This would free the Central Board of Secondary Education (CBSE) and the All India Council for Technical Education from administrative responsibility, so that they can focus more on academics," he added.
Centre raises CLSS loan tenure to 20 years
The Centre today approved extension of tenure of loans under Credit Linked Subsidy Scheme (CLSS) of Pradhan Mantri Awas Yojana (PMAY) to 20 years from 15 years and introduction of a new CLSS for middle income group with a provision of Rs 1,000 crore in 2017-18.
"The Union Cabinet chaired by Prime Minister Narendra Modi has given ex-post facto approval to the proposals for extension of tenure of loans under the CLSS vertical of Pradhan Mantri Awas Yojana (Urban) Mission from 15 to 20 years," said an official statement.
According to the statement, the scheme will be renamed as CLSS for EWS/LIG -- for economically weaker sections (EWS) of society/Lower Income Group (LIG).
Besides, the Cabinet approved the introduction of a new Credit-Linked Subsidy Scheme for the Middle Income Group (MIG).
The government has proposed to construct 1 crore houses for the homeless by 2019. The PM Awas Yojana allocation has been raised to Rs 23,000 crore, from Rs 15,000 crore.
The government has also allowed primary lending institutions (PLIs) that have signed MoU with central nodal agencies (CNAs), under the CLSS vertical of PMAY (Urban) (now CLSS for EWS/LIG), the option to extend the mandate of their MoU to CLSS for MIG with appropriate changes as applicable.
It also cleared the proposal for rationalising or introducing the processing fees payable to the PLIs for the loans sanctioned under these schemes.
The government has allocated Rs 1,000 crore initially in the Budget for 2017-18 at the BE (budget estimates) stage for the proposed CLSS for MIG. It also approved issuance of operational guidelines for CLSS for MIG with approval of the minister-in-charge.
The objective is to increase the off-take in EWS and LIG segments under the existing Pradhan Mantri Awas Yojana (Urban) Housing for All Mission and reach out to MIG.
Besides, it will make procedures easy for PLIs and provide an incentive to them for higher participation in the housing and urban development sector.
The scheme will make available funds through budgetary provisions and clearly define the procedure and implementation of the programmes.
The outreach will ensure greater participation among the EWS, LIG and MIG segments to provide Housing for All by 2022, ensuring equity and inclusiveness.
The interest subsidy to be disbursed to the beneficiaries will be credited to their home loan accounts after the PLIs have satisfied the eligibility criteria through due diligence.
The proposed interest subsidy scheme for MIG is an innovative approach to address the needs of housing of this category, it said.
New AIIMS for Jharkhand and Gujarat: Jaitley
Finance Minister Arun Jaitley on Wednesday announced two new All India Institutes of Medical Sciences (AIIMS) in Jharkhand and Gujarat as part of increasing healthcare in the country.
"Two new AIIMS will come up in Jharkhand and Gujarat," said Jaitley presenting the Union Budget for fiscal 2017-18.
For the first time in India the Union Budget was presented on February 1.
Jaitley said the government has set new targets to eliminate Kala Azar by 2017 and Leprosy by 2018 among other diseases to be eliminated within a targeted time.
"The government has targeted to eliminate Kala Azar by 2017, Leprosy by 2018 and Tuberculosis by 2020 as part of the health policies," said Jaitley
Jaitley said the government aims to bring down the Maternal Mortality Rate (MMR) to 100 till 2020.
"The government wants to bring down the MMR from 167 in 2011-13 to 100 between 2018-2020," said Jaitley.
Under the new decisions taken in the health sector, Jaitley said that existing health sub centres will be converted into Health Wellness Centres.
"....The government has decided to start DNB (Diplomate National Board) courses in many of the hospitals across the country," said Jaitley.
PMAY's allocation increases to Rs 23,000 crore
Presenting the budget for 2017-18 in the Lok Sabha, Finance Minister Arun Jaitley on Wednesday increased the allocation for Pradhan Mantri Awas Yojana (PMAY) Gramin to Rs 23,000 crore for the next fiscal.
Jaitley had allocated Rs 15,000 crore for the PMAY in the last year's budget.
"We propose to complete one crore houses by 2019 for those living in kachha houses," he said.
Affordable housing projects will be given infrastructure status to avail benefits.
Five special tourism zones to come up: Jaitley
Finance Minister Arun Jaitley on Wednesday announced that the government will establish five special tourism zones in the next financial year.
"Tourism is a big employment generator and has a multiplier impact on the economy. Five special tourism zones anchored on SPV (Special purpose vehicle) will be set up in partnership with the states," Jaitley said, presenting the Union Budget 2017-18 in the Lok Sabha.
"The Incredible India's second campaign will be launched across the world," he added.
Agri credit raised to record Rs 10 lakh cr in FY18
In a major thrust to agriculture, Finance Minister Arun Jaitley today announced a whopping Rs 1 lakh crore hike in the credit target for the next fiscal to Rs 10 lakh crore as part of the government's efforts to double farm incomes in the next five years.
"The target for agricultural credit in 2017-18 has been fixed at a record level of Rs 10 lakh crore," Jaitley said in his Budget speech.
The government will take special efforts to ensure adequate credit flow to underserved areas -- the eastern states and J&K, he added.
The government provides short-term crop loans up to Rs 3 lakh at subsidised interest rate of 7 per cent per annum. An additional incentive of 3 per cent is provided to farmers for prompt repayment of loans within due date, making an effective interest rate for them at 4 per cent.
The Finance Minister noted that the agriculture sector is expected to grow at 4.1 per cent during the current fiscal on good monsoon. Sowing of both kharif and rabi crops has been higher.
Jaitley said the allocation for new crop insurance scheme 'Pradhan Mantri Fasal Bima Yojana', which was launched last year, has been increased to Rs 13,240 crore this fiscal from budgeted Rs 5,500 crore. The allocation for the next fiscal has been earmarked at Rs 9,000 crore.
"The coverage of this scheme will be increased from 30 per cent of the cropped area in 2016-17 to 40 per cent in 2017-18 to 50 per cent in 2018-19," he said.
The finance minister said that dedicated micro-irrigation fund will be created with a corpus of Rs 5000 crore.
Stating that dairy is an important source of additional income for farmers, he said the government will set up a dairy processing fund of Rs 8,000 crore over three years with initial corpus of Rs 2,000 crore.
Jaitley also said the government will prepare a model law on contract farming which will be circulated to state governments.
Equities augment post-Budget presentation
Positive budgetary announcements, coupled with a strong rupee lifted the Indian equities markets during the mid-afternoon trade session on Wednesday.
The wider 51-scrip Nifty of the National Stock Exchange (NSE) surged by 60.25 points or 0.70 per cent, to 8,621.55 points.
The barometer 30-scrip sensitive index (Sensex) of the BSE, which opened at 27,669.08 points, traded at 27,937.08 points (at 1.05 p.m.) -- up 281.12 points or 1.02 per cent, from the previous close at 27,655.96 points.
Will reach out to industry from April 1 on GST awareness: Jaitley
Finance Minister Arun Jaitley on Wednesday said the government was ready for implementation of the Goods and Services Tax (GST) and will begin reaching out to the industry from April 1 to make them aware of the new tax regime.
Jaitley however did not spell out the likely date for implementation of the new indirect tax regime.
"GST Council has finalised recommendations on all issues, the preparedness of IT is on schedule. On April 1, the reaching out to the industry will begin to make them aware of the new tax system, as per schedule," the Finance Minister said while presenting the Union Budget 2017-18 in the Lok Sabha.
"Preparatory work on GST is top priority of the government. Several teams of the Centre and states are working towards it," he added.
He said he was not making too many changes in the excise and customs as they will be soon replaced by GST.
He further said the implementation of GST will bring in increased revenues to the Centre and states and spur competitiveness.
The GST Council held nine meetings to discuss the tax rate, threshold exemptions, compensation to the states, draft laws and administrative mechanism, among others.
The Finance Minister had earlier said that July 1, 2017, appeared to be a realistic option for implementing GST. The earlier implementation date was April 1, which is fairly out of the question after the GST Council resolved all its issues only by January 16 this year.
The Centre and the states agreed on a formula to resolve the issue of cross-empowerment and dual control under the Goods and Services Tax regime.
Anonymous donation to political parties reduced to Rs 2000
Political parties receiving donations above Rs 2,000 will now have to disclose the identity of the donor, Finance Minister Arun Jaitley said on Wednesday, announcing new rules for greater transparency in political funding in the country.
This is a sharp drop from the Rs 20,000 that the political parties were so far allowed to receive in anonymous cash donations.
Presenting the Union Budget for 2017-18, Jaitley said the government has accepted the Election Commission's recommendation to bring in transparency in political funding and political parties can take donations from donors through cheque and digital payments.
He said as an additional step, the government proposes to amend the Reserve Bank of India Act for issuing electoral bonds that can be bought through cheques and will be redeemable in the registered account of a political party.
"This reform will bring greater reform in political funding while preventing future generation of black money," Jaitley said.
"Even after 70 years of Independence, there is no transparency in political funding. Most donations are received in cash, and the donors too hesitate to disclose their identity," Jaitley said.
"Maximum amount of cash donation to any political party will be Rs 2,000 from any person," Jaitley said.
Till now, most political parties showed their donations received in cash in chunks of below Rs 20,000, as they were not bound to disclose the identity of donors giving up to Rs 20,000.
The EC had asked the government, among other things, to bring down this limit of anonymous donation to Rs 2,000.
Jaitley targets 2017-18 fiscal deficit at 3.2% of GDP
In a move to support higher government spending in the coming fiscal, Finance minister Arun Jaitley on wednesday pegged the fiscal deficit target at 3.2 per cent of the country's GDP in his Budget 2017-18 presented in Parliament.
The figure is higher than the earlier targeted figure of 3 per cent of the GDP for 2017-18. The fiscal deficit target for the current fiscal is at 3.5 per cent, while for 2018-19 it has been set at 3 per cent.
"I have pegged the fiscal deficit for 2017-18 at 3.2 per cent of GDP and remain committed to achieve 3 per cent in the following year," Jaitley said, presenting his budget.
"With this gradual approach, I have ensured adherence to fiscal consolidation, without compromising the requirements of public investment," he said.
"It will be our endeavour to improve upon these fiscal numbers, especially the fiscal deficit, in the next year, through greater focus on quality of expenditure and higher tax realisation from the huge cash deposits in banks, triggered by demonetisation," he added.
In Budget 2017-18, Jaitley has provided for a total government expenditure of Rs 21,41,000 crore in the forthcoming fiscal.
The Finance Ministry's Economic Survey tabled in Parliament on Tuesday, which has sharply cut the country's GDP growth projection for this fiscal to 6.5 per cent, urged the Centre to act as a model for states on fiscal prudence by its own fiscal management.
"The path of fiscal prudence embarked upon by this government is critical: in itself but also as a model for the states," the Survey authored by Chief Economic Advisor Arvind Subramanian said.
With the government under pressure from global rating agencies on this count, India's fiscal deficit in the April-November period of the current fiscal touched Rs 7.96 lakh crore -- or 85.8 per cent of Budget estimates for 2016-17 -- as against 87 per cent of Budget in the same period of the previous year.
According to the Controller General of Accounts data, the deficit, or the gap between expenditure and revenue for the entire current fiscal, has been pegged at Rs 5.34 lakh crore, as compared to the deficit of Rs 5.35 lakh crore in the last fiscal as per revised estimates of 2015-16.
The exchequer's tax revenue during the period in question yielded Rs 6.21 lakh crore, or 58.9 per cent of the estimates, while total receipts from revenue and non-debt capital during the fiscal's first eight months were Rs 7.96 lakh crore, or 57.8 per cent of the estimates for the current year.
Total expenditure during the April-November period was Rs 12.9 lakh crore, or 65 per cent of the entire fiscal's estimate. Of the total expenditure, money spent on plan was over Rs 3.64 lakh crore, while non-plan expenditure came to more than Rs 9.22 lakh crore.
The revenue deficit during April-November was over Rs 3.48 lakh crore, or 98.4 per cent, of the estimates.
Cash dealings above Rs 3 lakh banned from Apr 1: Jaitley
Continuing with government steps to clamp down on black money, Finance Minister Arun Jaitley today proposed to ban all cash transactions above Rs 3 lakh beginning April 1, 2017.
The decision to ban cash transactions beyond a threshold is based on the recommendation of the Special Investigation Team on black money that was set up by the Supreme Court, Jaitley said while presenting Union Budget 2017-18 in Parliament.
All cash transactions above Rs 3 lakh will be banned, he said.
The SIT, headed by Justice M B Shah (retired), in July had submitted its fifth report to the Supreme Court on steps needed to curb black money.
Noting that a large amount of unaccounted wealth is stored in cash, SIT had said: "Having considered the provisions which exist in this regard in various countries and also having considered various reports and observations of courts regarding cash transactions, the SIT felt that there is a need to put an upper limit to cash transactions."
It recommended a total ban on cash transactions of Rs 3 lakh and above and that "an Act be framed to declare such transactions as illegal and punishable under law".
Railways to have special safety fund of Rs 1 lakh cr
With railways plagued by repeated derailments, government today proposed setting up of a special safety fund of Rs 1 lakh crore that will cover upgradation of tracks and signalling besides elimination of unmanned level crossings.
The Railway Budget, merged with General Budget 2017-18, also provides for commissioning of new railway lines of 3,500 km will against 2,800 kms in 2016-17.
Finance Minister Arun Jaitley announced the Plan size for the next fiscal for the Railways at Rs 1,31,000 crore as against Rs 1.21 lakh crore last year.
He proposed creation of 'Rashtriya Rail Sanraksha Kosh' (National Rail Safety Fund) with a corpus of Rs 1 lakh crore.
Emphasising on safety, the Budget proposed elimination of all unmanned level crossings on the broad gauge network by 2020.
Addressing concerns of the differently-abled persons, Jaitley announced that 500 stations would be made disbaled friendly.
The Budget also promised to equip all coaches with bio toilets and announced "Clean my coach' App for passengers.
In order to encourage E-ticketing, Jaitley announced withdrawal of service charges from tickets booked through IRCTC.
Railway PSUs IRCTC, IRFC and Concor are to be listed on various stock exchanges.
Govt to borrow Rs 3.5 lakh crore in FY18
The government will borrow Rs 3.5 lakh crore from the market in 2017-18, around Rs 75,000 crore lower than the the current fiscal.
"I have taken due care to limit the net market borrowing of the government to Rs 3.48 lakh crore after buyback, much lower than Rs 4.25 lakh crore of the previous year," Finance Minister Arun Jaitley said in the Budget 2017-18 speech today.
However, gross borrowing has been pegged at Rs 5.8 lakh crore up for 2017-18, marginally higher from Budget estimate of Rs 6 lakh crore in the ongoing fiscal.
Gross borrowing includes repayments of past loans and interests.
Repayment for past loans for the next fiscal has been pegged at 1.5 lakh crore.
Under the Market Stabilisation Scheme (MSS), the government will float bonds worth Rs 1 lakh crore in the next fiscal as against Rs 1.01 lakh crore in the current fiscal.
MSS does not add to the fiscal burden but it is used to manage liquidity in the market.
Against the Budget estimate of Rs 20,000 crore under MSS for the current fiscal, the government had to raise the limit to Rs 1.01 lakh crore in order to mop up additional liquidity infused in the market due to demonetisation.
100% penalty on cash transaction above Rs 3 lakh
Anyone transacting in cash above the newly imposed limit of Rs 3 lakh will have to pay a penalty of a similar amount, according to a top government official.
Finance Minister Arun Jaitley announced in his budget speech that on the recommendation of the Special Investigation Team (SIT) on Black Money, the government had decided not to allow cash transactions above Rs 3 lakh.
Any individual or firm which pays anyone over this amount will have to pay a 100 per cent penalty of the amount which exceeds this limit, according to Revenue Secretary Hasmukh Adhia.
Adhia told CNBC TV18 that apart from the penalty, the expenditure would not be permitted under the Income Tax for companies making such a transaction above the limit.
Jaitley proposes IT for education, more skill centres
Students may see an increased presence of online courses at institutes of higher learning with Finance Minister Arun Jaitley on Wednesday proposing to harness information technology for learning purposes.
Presenting the Union Budget 2017-18 in the Lok Sabha, Jaitley charted out schemes aimed at enriching youths, and expressed his design to "leverage information technology through the 'Swayam' platform with at least 350 online courses".
The access to these Massive Open Online Courses (Moocs) will be widened through Direct-to-Home (DTH) channels dedicated to education, Jaitley said.
The University Grants Commission (UGC) is already in the process of asking colleges to submit the list of all such online courses being offered at their institutes.
With an aim to unburden educational boards and bodies of some of their loads, Jaitley proposed to establish a 'National Testing Agency' which would conduct all entrance exams for higher education on their behalf.
"This will free CBSE and AICTE (Central Board of Secondary Edcucation and All India Council for Technical Education) from administrative burden and enable them to focus on academics more," he said.
He also announced to increase the number of Pradhan Mantri Kaushal Kendra (PMKK) to 600 districts, from the currently operational 60 districts.
A total of 100 Indian International Skill Centres will be established across the country to impart advance professional training and training in foreign languages.
"This will help them (youths) get jobs abroad," Jaitley said.
Budget unveils tax incentive for building Andhra capital
To provide relief to people who have given land for setting up of Amaravati, new capital of Andhra Pradesh, Finance Minister Arun Jaitley today exempted them from capital gains tax on transfer of such land for development of the greenfield city.
"The new capital for state of Andhra Pradesh is being constructed by innovative land-pooling mechanism without use of the Land Acquisition Act. I propose to exempt from capital gain tax," Jaitley said while tabling the Union Budget for 2017-18 in the Lok Sabha.
The capital tax gains will be exempted on those who were the owners of such land as on June 2, 2014, the date on which the state of Andhra Pradesh was reorganised, and whose land is being pooled for creation of the capital city under the government scheme, he said.
A new clause (37A) in section 10 of the Andhra Pradesh Capital Region Act will be inserted to ensure capital gains arising from transfer of land are not charged.
The exemption will be applicable to transfer of capital assets, be it land or building or both, under the land pooling scheme.
The exemption will also be applicable to sale of Land Pooling Ownership Certificates (LPOCs) in lieu of land transferred under the scheme as well as sale of reconstituted plot or land within two years from the end of financial year in which the possession of such plot or land was handed over.
This amendment will take effect retrospectively from April 2015 and will accordingly apply in relation to the assessment year 2015-16 and subsequent period.
The government has also proposed to make amendment in section 49 of the Act to ensure the cost of acquisition of reconstituted plot or land after the expiry of two years will be stamp duty value on the last day of the second financial year.
"This amendment will take effect from April 1, 2018, and will accordingly apply in relation to the assessment year 2018-19 and subsequent years," the government said in its Budget 2017-18.
As per the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2014, the specified compensation received by the landowner in lieu of acquisition of land is exempt from income tax.
The land pooling scheme is an alternative arrangement made by the Andhra Pradesh government for formation of new capital city of Amaravati to avoid land acquisition disputes and lessen the financial burden associated with payment of compensation under the Act.
In the land pooling scheme, the compensation in the form of reconstituted plot or land is provided to landowners.
However, the existing provisions of the Act do not provide exemption from tax on transfer of land under the land pooling scheme as well as on transfer of LPOCs or reconstituted plot or land.
Rs 1,31,000 cr for Railways capex, development spend in 2017-18
Total capital and development expenditure on the Indian Railways during the next fiscal has been pegged at Rs 1,31,000 crore, with a little less than half to be provided by the government, Finance Minister Arun Jaitley said in his budget presentation on Wednesday.
"For 2017-18, the total capital and development expenditure of Railways has been pegged at Rs 1,31,000 crore. This includes Rs 55,000 crore provided by the government," Jaitley said presenting the Union Budget 2017-18, which for the first time in 93 years merges the erstwhile Railway Budget with the general budget.
"This decision (to merge budgets) brings the Railways to the centrestage of government's fiscal policy and would facilitate multi-modal transport planning between railways, highways and inland waterways," he said.
"The functional autonomy of Railways will, however, continue," he added.
The Finance Minister spelt out the four main focus areas for the Railways in the budget as being "passenger safety, capital and development works, cleanliness, and finance and accounting reforms."
He also announced a Rail safety fund -- Rashtriya Rail Sanraksha Kosh -- which will be created with a corpus of Rs 1 lakh crore over a period of five years.
As part of accounting reforms, accrual based financial statements will be rolled out by March 2019, he added.
The service charge on Railway tickets booked through IRCTC will be withdrawn.
Jaitley also said dedicated trains would be launched for pilgrimage and tourism travel.
Moreover, a new Metro Rail policy will be announced, which is expected to open up new jobs for the youths.
'Infra status to affordable housing will help in foreign funds inflow'
Giving infrastructure status to the affordable housing sector, as announced by Finance Minister Arun Jaitley in the Budget 2017-18, will open the door to foreign funds at cheaper cost to developers and attract more investments in the sector, experts said on Wednesday.
Affordable housing developers will also be eligible for government's incentives, tax benefits and institutional funding.
"Affordable housing developers will now be eligible for several government incentives, subsidies, tax benefits, and most importantly, institutional funding. The status could also mean that the government may release land specifically for affordable housing development in central locations of major urban centres in India," said Neeraj Bansal, Partner and Head of Real estate and Construction in KPMG in India.
"With the infrastructure status, developers can access foreign funds at a cheaper cost by way of debt and it will be a priority lending for banks as well. This should result in progress in the sector," said Hemal Mehta - Partner - Deloitte Haskins & Sells LLP.
Tata Housing's MD and CEO Brotin Banerjee said that infrastructure status to affordable housing was a long-standing demand of the sector. "The government has realised that housing and infrastructure can be two pillars to increase GDP and accelerate economic growth," he said.
"Easy and dedicated access to institutional financing, higher limit on external commercial borrowings will attract more investments and assure sustained growth of affordable housing in India, making it the core driving segment for real estate," Banerjee said.
On the other hand, long term financing at lower rates will reduce costs of construction for developers allowing them to pass on benefits to consumers. The new status will increase the resource allocation for the sector, catalysing housing supply and reducing the supply gap, he said.
Experts also say the move will not only allow access of cheaper loans for developers of budget housing but significantly boost the sector in achieving the government target of Housing for All by 2022.
"The affordable housing sector has seen a significant change in the government's existing scheme, with the qualifying size requirements now changed from built-up area to carpet area of 30 sqm and 60 sqm for projects within the municipal limits of the large four cities," Amit Enterprises Housing's CMD Kishore Pate said.
The Finance Minister reduced the holding period for land and buildings from three years to two years for long-term capital gains purpose. "This would help improve investability in properties in comparison to shares and stocks where the period is one year," Bansal added.
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