Budget 2018 Highlights India: Big quote of the day - in his late evening comment, Finance Minister Arun Jaitley had this to say, ''Step by step, in every budget, I have been putting surplus money in the hands of the middle-class taxpayer.''
Budget 2018 Highlights India: Big quote of the day – in his late evening comment, Jaitley had this to say, ”Step by step, in every budget, I have been putting surplus money in the hands of the middle-class taxpayer.” Finance Minister Arun Jaitley today presented the last full budget of the PM Narendra Modi government – Jaitley met President Ram Nath Kovind at Rashtrapati Bhavan before presenting the Union Budget 2018-19 in Parliament. This is the last budget of the present regime since next year general elections will be held. So, in 2019, government will present an interim budget. The budget exercise will then be completed by the new government that will be sworn in post-poll. Significantly, in the lead up to Budget 2018 day, both PM Modi and FM Arun Jaitley had indicated that their budget will be about hard economics and not politics.
Therefore, most people’s expectations were that there would be very few sops for anybody. However, that it was expected to be a positive budget overall was signified by the fact that Sensex jumped in excess of 150 points ahead of presentation by the finance minister. In fact, the index regained the 36,000-mark by soaring over 171 points in opening trade itself. Just what did really happen in Parliament thereafter? Well, for starters, Cabinet approved the Union Budget for 2018-19, official sources revealed. FM Jaitley started the process by saying, “Budget 2018 will focus on strengthening agricultural and rural economy. When our govt took over India was considered one of the fragile five economies of the world; we have reversed it; India is today fastest growing economy. India is today a USD 2.5 trillion economy and will become fifth largest economy in the world from the present seventh largest. Govt focusing on ease of living now. We are firmly on path to achieve 8 pct growth”. Former FM PM Chidambaram reacted today by saying, “Farm sector stress will continue. Medical health care is a big jumla. Nothing in the budget to boost private investment. No tax relief to the average tax payer. Is the FM serious?” Check out the Union Budget 2018 Highlights and key points here:
Budget 2018 highlights show exactly how the proposals announced by FM will impact all concerned. here is what you really must know to get the maximum benefit.
1. Govt has made many positive changes in the personal income tax rates applicable to individuals in the last three years, therefore, I do not wish to make any changes to this, Arun Jaitley said.
2. For senior citizens, exemption of interest income on bank deposits raised to Rs 50,000.
3. Govt to reduce hardships faced in realty deals; no adjustment to be made in case circle rate does not exceed 5 pc of sale consideration
4. Standard deduction of Rs 40,000 allowed for transport, medical reimbursement for salaried tax payers. Rs 8,000 crore revenue lost due to standard deduction allowed to salaried employees. Salaried taxpayers, pensioners need no documents, bills to claim Rs 40,000 standard I-T deduction on travel, medical expenses,” said CBDT chief Sushil Chandra later in the evening, thereby conveying some more good news to taxpayers. Archit Gupta, Founder & CEO ClearTax : Standard deduction has been reintroduced but at a cost, it takes away medical reimbursement and travel allowance. There were several demands to raise medical reimbursement from 15,000 and bring it up according to current prices (the amount has been same since more than a decade). However, now the clamour for raising this limit will die down. With this, for a salaried, the amount taxable under salary shall be reduced by Rs 5,800. While cess will go up by 1%. Senior citizens have much to rejoice and will face much lower burden of taxes, this is especially crucial in the falling interest rates from banks and deposits.
5. Rs 7.5 lakh per senior citizen limit for investment in interest-bearing LIC schemes doubled to Rs 15 lakh
6. Cash payments exceeding Rs 10,000 by trusts and institutions will be disallowed in a bid to curb cash economy.
7. Strong case for long term capital gains from equities; 10 pc tax on long term capital gains in excess of Rs 1 lakh.
8. Education cess increased to 4 pc from 3 pc to collect additional Rs 11,000 cr.
9. Customs duty on perfumes, dental hygiene, after-shave, deodorants, room deodorizers, preparations for use on hair doubled to 20 pc.
10. Import duty on fruit juice raised from 30 pc to 50 pc.
11. Duties on petrol, diesel rejigged; basic excise duty lowered by Rs 2 per litre, Rs 6 additional excise duty abolished, but Rs 8 a litre road cess introduced. ”2 Rs excise on petrol and diesel is being reduced & this is being converted into cess, that is the only change we have made, practically there is no impact on the final price of petrol & diesel. To the consumers, there is no change,” says Hasmukh Adhia, Finance Secretary.
12. Import duty on LCD/LED/OLED panels, parts of TVs hiked to 15 pc; duty on smart watches, wearable devices, footwear doubled to 20 pc.
13. Customs duty on imitation jewellery hiked from 15 pc to 20 pc; doubled on all watches to 20 pc.
14. Customs duty on sunglasses, cigarette lighter, toys, bus and truck tyres, select furniture hiked.
15. Import of solar tempered glass for manufacture of solar cells exempted from customs duty.
16. Customs duty on crude edible vegetable oils like groundnut oil, safflower seed oil hiked from 12.5 pc to 30 pc; on refined edible vegetable oil from 20 pc to 35 pc.
17. Tax on distributed income of equity oriented mutual funds at the rate of 10 per cent announced.
18. New scheme for providing electronic assessment to eliminate person-to-person contact
19. Customs duty on mobile phones to be hiked to 20 per cent from 15 per cent
20. Indian economy has performed very well since our government took over in may 2014. Now, India is a $2.5 tn economy, 7th largest in world, expect to become 5th largest soon. On PPP we are already third biggest economy. 6.2 pct GDP growth has signalled this strength. This year’s budget will focus on strengthening and building on these gains. Budget 2018 will focus on strengthening agricultural and rural economy. Modi government had promised to reduce poverty; we have taken decisive action. From ease of doing business, our government has moved to ease of living for the poor and middle class.
Watch video: FM Arun Jaitley arrives in Parliament
21. Exports expected to grow by 15 pct in 2017-18.
22. Cooking gas being given free to poor under PMUY, 4 cr unconnected being provided electricity connection, stent prices slashed.
23. Emphasis on generating higher income for farmers; want to help farmers produce more and realise higher prices.
24. Government proposes to launch ‘Operation Greens’ on the lines of Operation Flood’.
25. Agri-Market Development Fund with a corpus of 2000 crore to be set up for developing agricultural markets.
26. The focus is on low-cost farming, higher MSP. Emphasis is on generating farm & non-farm employment for farmers. Minimum support price has been set at 1.5 times the production cost for kharif crops.
Watch video: Brief history of Budget: 10 interesting facts you shouldn’t miss
27. Put forth proposal to hike institutional credit for agriculture to Rs 11 lakh crore for 2018-19.
28. Food processing sector growing at 8 pc; allocation for food processing ministry being doubled to Rs 1400 cr.
29. Proposal made to hike target of providing free LPG connections to 8 crore to poor women.
30. Under Swachh Bharat Mission, Centre plans to construct 2 crore more toilets.
31. Kisan credit card facility extended to fisheries and animal husbandry sectors.
32. Institutional credit to agriculture to be raised to Rs 11 lakh cr in 2018-19.
33. Rs 16,000 cr to be spent on providing electricity connection to 4 cr poor households.
34. 1 cr houses to be built under Pradhan Mantri Awas Yojana in rural areas.
35. Quality of education still a concern. Education to be treated holistically without segmentation from class nursery to 12th. Govt to launch ‘Revitalising Infrastructure and Systems in Education by 2022. Govt to increase digital intensity in education. Technology to be the biggest driver in improving quality of education. To increase digital intensity in education, will move infra from blackboard to digital board. By 2022, every block with more than 50 per cent ST population will have Eklavya schools at par with Navodaya Vidyalayas.
36. Govt to establish a dedicated affordable housing fund under National Housing Bank for priority sector lending.
37. Focus of the government will be to provide maximum livelihood projects in rural areas. Govt to substantially increase allocation under national livelihood mission to Rs 5,750 cr in next fiscal.
38. Govt to launch Prime Minister’s Research Fellow Scheme which will identify 1000 B.Tech students to do Ph.D at IITs. Two new schools of planning and architecture to be set up; 18 more in IITs and NIITs.
39. Govt to launch flagship National Health Protection scheme to cover 10 crore poor and vulnerable people. Govt to set up 24 new medical colleges and hospitals by upgrading district level ones. 10 cr families will be provided Rs 5 lakh cover per family per year for treatment. Government is slowly but steadily progressing towards universal health coverage. 115 aspiration districts identified taking various indices of development into consideration, quality of life to be improved in these districts. Govt’s budget for health, education and social security increased to Rs 1.38 lakh crore for 2018-19 from Rs 1.22 lakh crore in current fiscal.
40. Allocation of Rs. 56,619 crore for SC welfare and Rs. 39,135 crore for ST welfare announced.
41. 115 “aspirational districts” to be made model districts of development.
42. Rs 4.6 lakh cr sanctioned under MUDRA Scheme
43. Environment for venture capitalists and angel investors to be strengthened
44. Employees PF Act to be amended to reduce contribution of women to 8 pc from 12 pc with no change in employer’s contribution
45. Contribution of 8.33% to EPF for new employees by the govt for three years and 12% govt contribution to EPF in sectors employing large number of people.
46. Rs 50 lakh cr needed for infrastructure building. National Highways exceeding 9,000-km will be completed in 2018-19
47. 99 cities selected for smart cities project with an outlay of Rs 2.04 lakh crore.
48. Indian Railways allocation in next fiscal now proposed at over Rs 1.48 lakh crore. 36,000-km of rail track renewal targeted in coming year. 4,267 unmanned railway crossings on broad gauge routes to be eliminated in next two years. Wifi, CCTVs to be progressively provided at all trains; escalators at stations with 25,000-plus footfalls.
49. Govt to expand capacity of airports by five times to cater to one billion trips a year. Regional air connectivity scheme shall connect 56 unserved airports and 31 unserved helipads.
50. SEBI may consider mandating large corporates to use bond market to finance one-fourth of their fund needs. Govt will monetise select central public sector enterprises using Infrastructure Investment Trusts.
51. 5 lakh WiFi hotspots to provide broadband access to 5 cr rural people.
52. Govt does not consider crypto-currency as legal; will take all measures against its illegal use.
53. Govt will evolve a scheme to provide a unique ID to every enterprise on lines of Aadhaar.
54. Rs 80,000 cr disinvestment target for 2018-19; Rs 1 lakh cr receipt expected in current year. Govt has initiated strategic disinvestment in 24 PSUs, including Air India.
55. Govt to formulate a comprehensive gold policy to develop gold as an asset class; gold monetisation scheme to be revamped. Gold monetisation scheme being revamped so that people can open gold deposit accounts in a hassle-free manner.
56. GST revenue for 2017-18 will be for 11 months; shortfall of non-tax revenue due to deferment of spectrum auction. Fiscal deficit for 2017-18 raised to 3.5 pc of GDP as against 3.2 pc previously estimated; for FY 19 deficit pegged at 3.3 pc as against 3 pc targeted previously.
57. Emoluments of the President to be revised to Rs 5 lakh per month & emoluments of the Vice-president to be revised to Rs 4 lakh per month. The Govt is proposing changes in refixing salaries of Members of Parliament. Law will provide automatic revision of emoluments of the MPs every 5 years indexed to inflation.
58. 372 specific business reform actions identified to improve ease of doing business; Evaluation of performance under this programme to be based on user feedback.
59. Will take all steps to eliminate the use of Crypto-Currencies, will encourage Blockchain technology in payment systems.
60. Tax payer base has risen from 6.47 crore in 2014-15 to 8.27 crore in 2016-17. Demonetisation was received by honest tax-payers as ‘Imaandari ka Utsav’. More payers joining tax net but turnover not encouraging.
61. Expenditure for 2017-18 pegged at Rs 21.57 lakh crore, as against Rs 21.8 lakh cr previously estimated. 12.6 pc growth rate in direct taxes in FY18. Rs 90,000 cr additional income tax collection in 2016-17 and 2017-18 due to measures against tax avoidance. Huge increase in tax returns filed; 85.51 lakh people filed returns in 2017-18, as against 66.26 lakh in 2016-17.
62. Reduced corporate tax by 25 pc extended to cos with turnover of Rs 250 cr to benefit small, micro and medium enterprises. Rs 7,000 cr revenue forgone on account of lower corporate tax for Rs 250 cr turnover companies.
63. Defence outlay raised to Rs 2.82 lakh crore in 2018-19 from Rs 2.67 lakh crore in current year.
64. Food subsidy to rise to Rs 1.69 lakh crore in 2018-19 from Rs 1.4 lakh crore in current year.
65. Market borrowing by govt to be lower at Rs 4.07 lakh crore in 2018-19 as against revised estimate of Rs 4.79 lakh crore in 2017-18.
66. Govt makes PAN mandatory for any entity entering into a financial transaction of Rs 2.5 lakh or more. PAN to be used as Unique Entity Number for non-individuals from Apr 1.
67. Gross budgetary support for Railways hiked to over Rs 3 lakh crore in 2018-19 from Rs 2.73 lakh crore in 2017-18.
While the Opposition parties are saying Budget 2018 has too many shortcomings and is not likely to help the economy grow, the ruling alliance is presenting a united front and saying the proposals are all intended to power development that will ultimately, help each and every citizen in the country.
PM Narendra Modi in his address to the media after the presentation of Budget 2018 spoke at length about its benefits for 125 crore Indians. PM said, “This budget has devoted attention to all sectors, ranging from agriculture to infrastructure. This Budget is farmer friendly, common citizen friendly, business environment friendly and development friendly. It will add to ‘Ease of Living’. The farmers, Dalits, tribal communities will gain from this Budget. The Budget will bring new opportunities for rural India. I congratulate the Finance Minister for the decision regarding MSP. I am sure it will help farmers tremendously.” PM added that this budget is “development-friendly” and will hasten India’s progress.
In his take on Budget 2018, Congress leader Manish Tewari said, “The government has attempted to pay lip service to farmers and to other marginalised sections of society, but it is a classical case of too less and completely at the inappropriate time.”
In his first reaction on Budget 2018, Congress leader and former Union finance minister P Chidambaram said that FM Arun Jaitley failed fiscal consolidation test, this failure will have serious consequences.
Budget 2018 highlights includes the rousing welcome Union Minister Smriti Irani gave to the proposals announced today. Irani said, “I want congratulate Prime Minister Narendra Modi on announcing the world’s biggest national health protection scheme. This budget is for the development of the poor, for farmers and increasing their income, senior citizens and women.”
On his part, Railway Minister Piyush Goyal said, “It’s a balanced budget, which is for every section of society, especially the focus on farmers and health services of the poor. Economy will also get a boost. I congratulate PM Modi and FM Jaitley.”
Yogi Adityanath, UP CM, had this to say, “Desh ke ghareebon, gaon, kisaano, buzurgon ko dhyaan mein rakh kar behtareen yojnaayen hain, PM ka abhinandan aur FM ko badhai.”
Union Minister MJ Akbar hailed FM focus and said, “In the 1 hour 45 minute speech, 1 hour was for the poor, this is indeed historic. The opposition has become too pessimistic.”
Home Minister Rajnath Singh said, “It’s a grand budget, lot of announcements for the poor, farmers and tribals. This budget will also cement India as a global economic power.” Congratulating Prime Minister Narendra Modi and Finance Minister Arun Jaitley on presenting a “historic budget for a new India”, he said, “It is indeed a budget for a progressive and positive India. This budget envisions a paradigm shift in economic priorities and it will help in bridging the gap between the rural and urban areas of our country. The budget is one of the most farmer and people’s friendly budgets presented in the recent years. The proposal to include 10 crore poor and vulnerable families under the annual health cover of Rs 5 lakh will bring a massive change in health outcomes. The budget will benefit farmers with better price realisation for their crops. The proposal of setting up MSP’s at 150 per cent of the production cost from the Kharif season will help in fighting the agrarian distress in rural areas.”
Nitin Gadkari said, “Medical insurance of Rs 5 lakh for 10 crore families is a huge initiative. This is a historic budget.”
Union Minister Ananth Kumar said, “It’s a transformational budget, and it will bring about a positive change in everyone’s lives. It’s a budget for the common man, the farmers and for the nation.”
Former Prime Minister of India, HD Deve Gowda said, “FM has tried to make improvements for farmers but the problems of farmers and rural people are enormous. Measures may not be sufficient.”
BJP president Amit Shah on his part took to Twitter and said, “This budget gives new wings to the aspirations of the poor, farmers and the middle class. The #NewIndiaBudget will truly empower all sections of the society to attain prosperity. I thank the government for the budgetary allocation of Rs 3 lakh crore under Mudra Yojana for the year 2018-2019 that will boost employment generation. This will specially benefit the women, OBC, SC & ST, as so far 76 per cent of loan accounts are of women and more than 50 per cent belong to the SC, ST & OBC.” Shah added, “The Modi govt has continuously improved fiscal deficit since its first budget. The target of 3.3 per cent for 2018-19 is another effort in the same direction and will certainly improve investor confidence in Indian economy.”
Yanamala Rama Krishnudu, AP Finance Minister, “We are not happy with UnionBudget2018 , whatever requests we made for Andhra Pradesh have not been addressed.”
West Bengal CM Mamata Banerjee said, “There was nothing new at all. It’s not a people friendly budget. FM said nothing about unemployment. Medium & Small scale sectors are still suffering. It’s a shame that has introduced only 1% education cess.”
Baba Ramdev in his reaction to Budget 2018 said, “It would have been better had people been provided relief in Income Tax up to a limit of Rs 5 lakh. I’m sure a decision will be taken in this regard soon. This was a nation building budget.”
Former RBI Governor C Rangarajan said, “Whether the budget as a whole will push up growth is questionable. Perhaps (if) the investment climate improves it will happen. That is why I say that it addresses the concern but not fully”.
He added, “There are two concerns. One relates to the fiscal deficit. There has been a slippage (on fiscal deficit) this year and the fiscal deficit set for next year is slightly on the higher side. What is important is the credibility relating to fiscal deficit”.
Rangarajan said that the second concern is that “Job creation will come only out of new investments and for promoting private investments. There is hardly anything in the budget which will have that effect of simulating private investments. The expenditure pattern is good, but fiscal deficit is a matter of concern”.