Union Budget 2017 will be presented on schedule in the Parliament today, that is February 1, at 11:00 AM. According to a Reuters report, the government will not postpone the presentation of the Budget despite the death of a sitting member of parliament (MP), E Ahamed. There were reports that the government, in consultation with the Opposition parties, will decide on the Budget presentation after Kerala MP E Ahamed passed away early today morning.`
The significance of the budget lies in the fact that it will take place after Prime Minister Narendra Modi’s much-debated and surprise demonetisation move. There will be many firsts. This is the first time that Railway budget will be presented with the general one. Also, the budget will be the first since the Modi government’s decision to disband the Planning Commission. The 12th Five Year Plan period will be over in 2017 and the budget will focus on revenue and capital expenditure rather than putting thrust on conventional plan and non-plan categories. It is likely, that FM Jaitley will likely boost spending and ease back on cutting the deficit as he seeks to lift growth.
Finance Minister Arun Jaitley is expected to reduce tax rates in Budget 2017 to ease the pain of demonetisation that the common man had to go through. FM Jaitley is also likely to hike the income tax exemption limit from the current Rs 2.5 lakh to Rs 3 lakh at the least. Post demonetisation, the government is expected to continue its war on black money and tax avoidance. General anti-avoidance rule (GAAR), which was very contentious when it first rolled out and has been delayed ever since is now finally expected to come in force despite persisting reservations of some players. Corporates, FIIs, and individuals will watch out for GAAR and its interplay with other tax avoidance initiatives. These initiatives also have to harmonise with tax treaties India has with key partners.