Challenges In 2017-18
- World economy faces considerable uncertainty, in the aftermath of major economic and political developments during the last year
- The US Federal Reserve’s , intention to increase policy rates in 2017, may lead to lower capital inflows and higher outflows from the emerging economies
- Uncertainty around commodity prices, especially that of crude oil, has implications for the fiscal situation of emerging economies
- Signs of retreat from globalization of goods, services and people, as pressures for protectionism are building up
Farmers
- Target for agricultural credit in 2017-18 has been fixed at a record level of Rs 10 lakh crores
- Coverage under Fasal Bima Yojana scheme will be increased from 30% of cropped area in 2016-17 to 40% in 2017-18 and 50% in 2018-19 for which a budget provision of Rs 9000 crore has been made
- Dedicated Micro Irrigation Fund in NABARD to achieve ‘per drop more crop’ with an initial corpus of Rs 5,000 crores
- Coverage of National Agricultural Market (e-NAM) to be expanded from 250 markets to 585 APMCs. Assistance up to Rs 75 lakhs will be provided to every e-NAM
- Dairy Processing and Infrastructure Development Fund to be set up in NABARD with a corpus of Rs 2000 crores and will be increased to Rs 8000 crores over 3 years
Rural Population
- Over Rs 3 lakh crores spent in rural areas every year, for rural poor from Central Budget, State Budgets, Bank linkage for self-help groups, etc
- Against target of 5 lakh farm ponds under MGNREGA, 10 lakh farm ponds would be completed by March 2017. During 2017-18, another 5 lakh farm ponds will be taken up
- Women participation in MGNREGA has increased to 55% from less than 48%. MGNREGA allocation to be the highest ever at Rs 48,000 crores in 2017-18.
- Sanitation coverage in rural India has gone up from 42% in Oct 2014 to about 60%. Open Defecation Free villages are now being given priority for piped water supply.
- Total allocation for Rural, Agriculture and Allied sectors is Rs 187223 crores
The poor and the underprivileged
- Mahila Shakti Kendra will be set up with an allocation of Rs 500 crores in 14 lakh ICDS Anganwadi Centres. This will provide one stop convergent support services for empowering rural women with opportunities for skill development, employment, digital literacy, health and nutrition
- Under Maternity Benefit Scheme Rs 6,000 each will be transferred directly to the bank accounts of pregnant women who undergo institutional delivery and vaccinate their children
- Affordable housing to be given infrastructure status
- National Housing Bank will refinance individual housing loans of about Rs 20,000 crore in 2017-18
Infrastructure
- For transportation sector as a whole, including rail, roads, shipping, provision of Rs 2,41,387 crores has been made in 2017-18.
- For 2017-18, the total capital and development expenditure of Railways has been pegged at Rs 1,31,000 crores. This includes Rs 55,000 crores provided by the Government
- For passenger safety, a Rashtriya Rail Sanraksha Kosh will be created with a corpus of Rs 1 lakh crores over a period of 5 years
- Unmanned level crossings on Broad Gauge lines will be eliminated by 2020
- In the next 3 years, the throughput is proposed to be enhanced by 10%. This will be done through modernisation and upgradation of identified corridors.
Financial Sector
- Foreign Investment Promotion Board to be abolished in 2017-18 and further liberalisation of FDI policy is under consideration
- An expert committee will be constituted to study and promote creation of an operational and legal framework to integrate spot market and derivatives market in the agricultural sector, for commodities trading. e- NAM to be an integral part of the framework.
- A mechanism to streamline institutional arrangements for resolution of disputes in infrastructure related construction contracts, PPP and public utility contracts will be introduced as an amendment to the Arbitration and Conciliation Act 1996.
Digital Economy
- 125 lakh people have adopted the BHIM app so far. The Government will launch two new schemes to promote the usage of BHIM; these are, Referral Bonus Scheme for individuals and a Cashback Scheme for merchants
- Aadhar Pay, a merchant version of Aadhar Enabled Payment System, will be launched shortly
- A Mission will be set up with a target of 2,500 crore digital transactions for 2017-18 through UPI, USSD, Aadhar Pay, IMPS and debit cards
Promoting affordable housing and real estate sector
- Under the scheme for profit-linked income tax deduction for promotion of affordable housing, carpet area instead of built up area of 30 and 60 Sq.mtr. will be counted.
- The 30 Sq.mtr. limit will apply only in case of municipal limits of 4 metropolitan cities while for the rest of the country including in the peripheral areas of metros, limit of 60 Sq.mtr. will apply
- For builders for whom constructed buildings are stock-in-trade, tax on notional rental income will only apply after one year of the end of the year in which completion certificate is received
- Reduction in the holding period for computing long term capital gains from transfer of immovable property from 3 years to 2 years. Also, the base year for indexation is proposed to be shifted from 1.4.1981 to 1.4.2001 for all classes of assets including immovable property
RAPID (Revenue, Accountability, Probity, Information and Digitisation)
- Maximise efforts for e-assessment in the coming year
- Enforcing greater accountability of officers of Tax Department for specific act of commission and omission.
Personal Income-tax
- Existing rate of taxation for individual assesses between income of Rs 2.5 lakhs to 5 lakhs reduced to 5% from the present rate of 10% 15
- Surcharge of 10% of tax payable on categories of individuals whose annual taxable income is between Rs 50 lakhs and Rs 1 crore
- Simple one-page form to be filed as Income Tax Return for the category of individuals having taxable income upto Rs 5 lakhs other than business income
- Appeal to all citizens of India to contribute to Nation Building by making a small payment of 5% tax if their income is falling in the lowest slab of 2.5 lakhs to 5 lakhs.
Goods and Services Tax
- The GST Council has finalised its recommendations on almost all the issues based on consensus on the basis of 9 meetings held
- Preparation of IT system for GST is also on schedule.
- The extensive reach-out efforts to trade and industry for GST will start from 1st April, 2017 to make them aware of the new taxation system.
