Union Minister for Finance Arun Jaitley on Saturday presented in Parliament the Budget 2015-16, with a focus on growth, promoting entrepreneurship and manufacturing, rationalizing tax regime and announcing some relief to common man.
Here are the highlights of the Budget…
• Govt. to introduce Gold Monetization Scheme, Sovereign Gold Bonds and Gold coins with Ashok Chakra
• For contribution to National Pension Scheme, exemption raised to Rs1.5 lakh from Rs1 lakh
• Increase in the limit of deduction in respect of health insurance premium to Rs25,000 from Rs15,000.
• For senior citizens the limit will stand increased to Rs30,000 from the existing Rs20,000.
• For very senior citizens of the age of 80 years or more, who are not covered by health insurance, deduction of Rs30,000 towards expenditure incurred on the treatment will allowed.
• All contributions to Sukanya Samridhi scheme to be tax-free.
Individual tax payer will benefit to the extent Rs4,44,200 from the exemptions announced
Taxation and Tax regime
• GST to put in place state of art indirect tax system by April 1st 2016
• Internationally competitive Direct Tax regime to be put in place, which will be stable and non-discriminatory.
• Applicability of GAAR deferred by two years ; will only apply prospectively after Apr 2017
• Basic rate of CorporateTax to be reduced from 30% to 25% in next 4 years; to be accompanied by reducing exemptions
• Wealth Tax to be abolished; 2% surcharge on super-rich having income over Rs 1 crore. This will net an additional tax revenue of Rs 9,000 crores
• Service Tax increased to 14%.
• Custom duty on raw materials and intermediaries to be reduced
• Clean energy cess increased from 100 to 200 Rupees per metric ton of coal to finance Green Energy Fund. Renewable energy target revised to 175,000 Mw.
• Direct tax proposals will lead to loss of Rs8,315 crore Indirect proposal will yield Rs23,383 crore
• India set to be the fastest growing large economy in the world.
• Double digit growth seems feasible
• Real GDP expected to accelerate to 7.4% during the current fiscal.
• Foreign Exchange reserves at $340 billion
• Fiscal deficit target of 3% to be achieved over next three years, instead of two.
• 4.1 % target being met this year, despite tax buoyancy being lower.
• Roadmap to achieve Fiscal deficit of 3% of GDP in three years: Target is 3.9% in 2015-16, 3.5% in 2016-17, 3% in 2017-18.
• Following 14th Finance Commission recommendations, states will get higher resources. 68% of total revenues will now be in the hands of states, ushering in an era of cooperative federalism.
• Budget Estimates of Expenditure: Rs17.77 lakh crore of which Non Plan is Rs13.12 lakh crore and Plan is Rs4.65 lakh crores
• Direct Tax collection to be Rs14.49 lakh crore rupees
Agriculture & Rural Development
• Rs5,300 crore to be spent on micro-irrigation
• Target of Rs8.5 lakh crore credit to be given to farmers in 2015-16
• Rural Infrastructure Development Fund to be--Rs25,000 crore
• Highest ever allocation for MGNREGA, by increasing it this year by Rs5,000 crore
Industry & Infrastructure
• Focus on making India a manufacturing hub to ensure employment to our youth.
• Make in India to promote entrepreneurship by making our youth job creators than being job seekers.
• National Investment & Infrastructure Fund announced.
• PPP model to be revised and revitalized. Public investment to be stepped up to catalyze private investments.
• Increased Budgetary allocation to Roads & Railways; Tax-free infra bonds for Rail, Roads transport projects
• 5 Ultra Mega power projects, of 4000 MW announced
• Ports in public sector will be encouraged to corporatize & become companies under companies act
Banking & Finance
• Mudra Bank to be set up to refinance micro finance institution under PMs Mudra Scheme, with a corpus of Rs20,000 crores. It will fund the unfunded entrepreneurs.
• Government to do away with distinctions between FII and FDI and replace it with Composite Caps.
• Government to utilize vast postal network for increasing access to institutional banking in order to promote financial inclusion.
• Comprehensive new law to track black money to be framed. 10 years rigorous imprisonment proposed under the law.
• Benami transaction prohibition Bill to be introduced in this session
• Forward Markets Commission to be merged with SEBI to create a better integrated regulatory system.
• Govt. to bring a Comprehensive Bankruptcy code for the ease of doing business by 2015-16
• Govt. plans an expert committee for Drafting Legislation for Regulatory mechanism
• Better targeting of subsidies is the need of the hour. Direct Benefit Transfer scheme to be scaled up many folds to ensure plugging of leakages.
• Government to launch PM Suraksha Bhima Yojana, offering coverage of Rs2 lakh for just premium of Rs12.
• PM Surakhsha Bhima Yojana to increase the access to insurance; it will be linked with Jan Dhan Yojana.
• Senior citizens welfare fund to subsidise the premium for elderly people
• Nai Manzil - A new scheme for empowering minority youth announced.
• Under Swachch Bharat, 50 lakh toilets have already been built, 6 crore toilets targeted to be constructed.
• AIIMS to be set up in J&K, Punjab, Tamil Nadu, Himachal Pradesh and Assam
• ISM Dhanabad will be upgraded to full IIT. Karnataka to get a new IIT.
• Visa –on-Arrival facility to be increased to 150 countries from the present 43, to promote tourism.