Union Budget 2018: The union budget 2018 presented under the Modi government will be important as it will be the last full-fledged budget ahead of the 2019 Lok Sabha elections. This budget holds importance for the Modi government as it will be presented after the implementation of the revolutionary tax reform, Goods and Services Tax or GST. Finance minister Arun Jaitley will present the union budget 2018 in the Parliament on February 1. Ahead of the budget 2018, the government has taken many laudable initiatives to improve the livelihood of the common man. Initiatives like Make In India has allowed foreign investors like Volvo to set up their manufacturing units in India, thus creating employment. However, when it comes to MSMEs, especially the first inventors and patents filed by them, Modi government can do more to save their interests. At present, the income generated from patents or innovation attract a tax of 10%. As per the recommendations of FICCI's pre-budget memorandum 2018 inventors and income earned from inventions or patent need to be channelised in a better format. FICCI states that the Finance Act, 2016 had introduced a provision under which income earned by a qualifying taxpayer from the exploitation of a patent would be taxed at a preferential rate of 10%. No deduction of any expenditure or allowance would be allowed in computing the income under this regime, and the income qualifying for the preferential rate should be by way of royalty in respect of a patent developed in India. \u2018Eligible taxpayer\u2019 has been defined to mean a person resident in India, who is the true and first inventor of the invention and whose name is entered on the patent register as the patentee in accordance with Patents Act, 1970. ALSO READ: Budget 2018 date: Day, time of FM Arun Jaitley\u2019s budget speech, economic survey and Budget session True and First Inventor Issues FICCI notes the benefits of the provision is restricted to \u2018true and first inventor of the invention\u2019. Even a person who is jointly registered with \u2018true and first inventor\u2019 should be treated as \u2018true and first inventor\u2019. In view of following features under the Patent law, the benefit of the provision may be denied to firms\/LLPs\/companies who register the patents jointly with \u2018true and first inventor\u2019 who may be an employee even though they may have incurred significant expenditure for development of the patent and they are first economic owners of such patent. WATCH| Here's What Economic Survey 2017 Means For Common Man [jwplayer qoImcBn2] * Under the Patents Act, following persons can apply for patent (a) a person claiming to be true and first inventor of the invention (b) an assignee of the true and first inventor in respect of right to make an application and (c) legal representative of a deceased person who immediately before his death was entitled to apply. * It is also settled under the Patent Act that a company or firm cannot claim to be \u2018true and first inventor\u2019. They can only apply as assignee of the true and first inventor. WATCH|10 New Facts On The Indian Economy [jwplayer quYOpQcd] Union Budget 2018 Recommendation It is, hence, recommended that the condition of joint patentee also being \u2018true and the first inventor\u2019 be omitted. If the intent is to allow benefit only to the first person to register patent, the phrase \u2018being the true and first inventor of the invention\u2019 used in context of joint person may be substituted with the phrase \u2018being the assignee of the true and first inventor in respect of the right to make an application for a patent\u2019.