Highlights of Union Budget 2016-17

Published On - February 29, 2016

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MAIN HIGHLIGHTS

  • 15% surcharge on income tax for those with incomes exceeding 1 crore per annum
  • To reduce multiplicity of taxes and cascading – 13 taxes with collection less than Rs 50 crore a year abolished.
  • Limited tax compliance window: 45% including surcharge and penalties and immunity from    prosecution.
  • Ceiling of tax rebate for tax payers with up to Rs 5 lakh annual income to be raised to Rs 5,000 from Rs 2,000.
  • Relief of Rs 3,000 per year to taxpayers with income below Rs 5 lakh per year, 1 crore tax payers to benefit.
  • Incentives for new manufacturing companies and smaller enterprise companies
  • Rs 38,500 crores allocated to MNREGA.
  • Rs 5,500 crores allocated to PM Fasal Bima Yojana.
  • Rs 9,000 crores allocated to Swaccha Bharat Abhiyaan.
  • National Skill Development Mission has imparted training to 76 lakh youth.
  • 1,500 multi skill training institutes to be set up.
  • Objective to skill 1 crore youth in the next 3 years under the PM Kaushal Vikas Yojana.
  • Health insurance of upto Rs 1 lakh per family.
  • 300 generic drug stores to be opened under PM Jan Aushadi Yojana.
  • Allocation of Pradhanmatri Gram Sadak Yojna to be increased to Rs 19,000 crore.
  • Deduction for rent payers raised from Rs 20,000 to Rs 60,000 to benefit those living in rented houses.

OTHER HIGHLIGHTS

  • Amidst global headwinds, the Indian economy has held its own.
  • Infaltion has come down even though there was a fall in monsoons.
  • Foreign exchange reserves are at highest ever level.
  • CPI inflation has declined to 5.4%.
  • The growth of GDP has accelerated to 7.6%.
  • Government has to prioritize expenditure. Focus on the rural and social sectors, infrastructure and recapitalization of bank.
  • Recapitalization of banks will be done during next financial year.
  • Nominal premium and highest ever compensation in case of crop loss under the PM Fasal Bima Yojana.
  • Aim to double the income of farmers in five years. Rs 35,984 crores total allocation for farmers’ welfare.
  • Farm, rural sector, infra, social sector to have more government expenditure.
  • Dedicated irrigation fund worth Rs 20,000 crore to be set up under NABARD.
  • A unified agriculture market e-platform will be dedicated to the nation on the birthday of Dr. BR Ambedkar.
  • 5 lakh acres to be brought under organic farming over three years.
  • Aim to double farmers’ income in 5 years. Rs 35,984 crore allocation for their welfare.
  • 65 eligible habitats to be connected via 2.23 lakh km of road. Current construction pace is 100 km per day.
  • Government is launching a new initiative to provide cooking gas to BPL families with state support.
  • Will enact a law to confer benefits on deserving sections on aadhar platform
  • Govt to provide incentive for deepwater gas exploration.
  • Work for passage of insolvency and bankruptcy laws, to undertake significant reforms.
  • 300 rurban clusters to be set up under Shyama Prasad Mukherji Rurban Mission
  • 100% rural electrification to be achieved by 1st May, 2018.
  • Rs 87,765 crores for rural development as a whole have been allocated in the budget .
  • 6 crore additional households to be covered under digital literacy scheme in next 3 years.
  • Appreciation for 75 lakh middle class and lower middle class for willingly giving up LPG subsidy.
  • New restructured scheme to increase the governance capabilities of PRIs to be launched: Rashtriya Gram Swaraj Abhiyan.
  • Allocation of Rs 35,984 crore for farm sector.
  • Govt to set apart Rs 412 crore to encourage organic farming.
  • Rs 2.87 lakh crore to be given grant-in-aid for gram panchayats and municipalities; it is quantum jump of 228%.
  • Stand Up India scheme allocated Rs 500 crore for SC, ST and women entrepreneurs.
  • 2 projects under Stand Up India to be promoted per bank branch per category.
  • 62 new Navodaya Vidyalayas will be opened in the next 2 years.
  • 85% of stalled road projects back on track.
  • Rs 97,000 crore allocated to road sector including PMGSY.
  • Total outlay for infrastructure Rs 2,21,246 crores in 2016/17.
  • Target of 10,000km of national highway and upgradation of 50,000km of state highways in 2016/17.
  • Rs 1,000 crore for higher education financing.
  • Govt drawing a comprehensive plan to exploit nuclear energy to be implemented in the next 15-20 years.
  • 100% FDI to be allowed through FIPB route in Food Products Produced and Marketed in India.
  • New Financial Data Management Centre to facilitate integrated data analysis.
  • Department of Disinvestment to be renamed as Department of Investment and Public Asset Management.
  • RBI Act to be amended to give statutory backing for monetary policy.
  • Amount sanctioned under PM Mudra Yojana has reached Rs 1 lakh crore to cover 2.5 crore borrowers by Feb, 2016.
  • 25,000 crore for recapitalization of public sector banks.
  • DBT on pilot basis in fertilizers to be introduced in some districts.
  • A bill on targeted delivery of financial services using Aadhar to be introduced.
  • FDI Policy: Changes proposed in areas – Insurance & Pension, Asset Reconstruction Companies, Stock Exchange.
  • More number of benches of Security Appellate Tribunal to be introduced by amending SEBI Act to reduce pendency.
  • Fiscal deficit for FY 2016-’17 targeted at 3.5%.
  • Tax proposals to provide relief to small taxpayers through rebates.
  • Consolidation roadmap for public sector banks next year.
  • Suitable changes to be made in customs and excise duty rates to improve competitiveness and boost Make in India.
  • Service Tax Exemption for services under the Deen Dayal Gram Jyoti Yojana.
  • HRA deduction up from 24,000 to 60,000 per annum.
  • 100% deduction for profits of undertakings from housing projects in cities during Jun’16 – Mar’19.
  • Krishi Kalyan cess to be imposed on all taxable services for agricultural sector.
  • Clean energy cess increased from RS. 200/ton to 400/ton on coal, lignite and peat.
  • Limited period compliance window for taxpayers to declare undisclosed income. Declarations to have immunity from prosecutions.
  • Govt to introduce bill to amend Companies Act for ease of doing business; to enable registration of companies in a day.
  • Clean Energy Cess to renamed as Clean Environment Cess.
  • Levy of heavy penalty for non payment of tax has led to high litigation. Proposal to modify scheme for penalties.