Bringing cheer to individual taxpayers, Finance Minister Arun Jaitley in his maiden Union Budget 2014-15 in Parliament on Thursday, raised personal tax exemption limit to Rs 2.5 lakh from the current Rs 2 lakh. Income tax exemption limit for senior citizens has been raised to Rs 3 lakh. The Investment limit under Section 80C has also been hiked to Rs 1.5 lakh from the current Rs 1 lakh, while the FM increased housing loan interest rate deduction limit to Rs 2 Lakh. In further relief to the depositors, the FM announced that the PPF (Public Provident Fund) deposit ceiling will be raised to Rs 1.5 lakh from the existing Rs 1 lakh. The FM also announced to raise FDI in Defence and Insurance sectors to 49 percent and said that the subsidy regime, particularly food and fuel, will be overhauled. Assuring investors that retrospective amendments to tax laws will be undertaken with extreme caution, Jaitley said all fresh cases arising out of the 2012 amendment of I-T Act will be looked into by a high-level CBDT committee. However, the existing tax disputes, arising out of Retrospective Amendment to the Income tax Act, 1961, and are pending in courts, will be allowed to reach their logical conclusions, he said. Stating that his predecessors have left a very daunting target of meeting the fiscal deficit, Jaitley said that the BJP government will take this as a challenge and meet the fiscal deficit target of 4.1 percent of GDP. Jaitley told Parliament that India`s 1.2 billion people were exasperated after two years of economic growth of below 5 percent. He vowed that Asia`s third largest economy would expand at a rate of 7-8 percent within three to four years. Here are the key highlights of Union Budget 2014-15: Taxation: Personal tax exemption limit raised to Rs 2.5 lakh from current Rs 2 lakh for taxpayers below 60 years Senior citizens tax exemption limit hiked from Rs 2.5 lakh to Rs 3 lakh No change in surcharge for corporates, individuals Education Cess to stay at current 3% Investment limit under Section 80C hiked to Rs 1.5 lakh from current Rs 1 lakh Exemption on housing loans interest on self-occupied property increased from Rs 1.5 lakh to 2 lakh Other highlights: The people of India have decisively voted for change India unhesitatingly desires to grow We look forward to lower levels of inflation The country is no mood to suffer from unemployment, lack of infrastructure and apathetic governance The continuing slowdown in emerging economies has posed threat to global economic recovery Slow decision-making has led to slow growth Steps announced in the budget are aimed for sustained growth of 7-8% within the next three-four years It would not be wise to expect that the same can be done and must be done in the first budget being presented within the first 45 days of the new govt We will leave no stone unturned to create an vibrant and strong India Will lay down broad policy indicators in the budget We cannot spend beyond our means, we needs to follow fiscal prudence We cannot leave a legacy of debt for our future generations Considering we have 2 years of GDP growth and static industrial sector, the target of 4.1% fiscal deficit is daunting I accept this target as a challenge Black money is curse on our economy We have to take bold steps to spur growth in economy. They are directional Govt committed to minimum government maximum governance Aim to make food and fuel subsidy more targeted so that it helps those who need them Urgent need to generate more resources for the economy This govt will not bring any change in tax rates retrospectively All retro taxes to be scrutinized by a high-level committee GST by end of the year (sets no firm deadline) To encourage development of smart cities; FDI cap on minimum built up area reduced Policy of NDA govt is to promote FDI in select sectors GST will streamline tax administration and result in higher tax collection for Centre and states FDI in defence sector to go up to 49% Greater autonomy to banks PSU 247,944 cr capex to create industrial cycle Smart cities: PM has vision of developing 100 new cities Rs 7,060 cr fund for smart cities Tourism: e-visas to be introduced at nine airports in the country in a phased manner Real estate investment trusts – modified REITS is being announced for infrastructure projects to reduce pressure on banking system Kisan Vikas Patra to be pushed further New scheme for skill development called Skill India to be launched Sanitation in every household by 2019 Shyama Prassad Mukherjee Rozgar mission to be launched New scheme for agricultural irrigation Rs 500 cr for rural electrification Rs 200 cr for Sardar Vallabhbhai statue in Gujarat Rs 50000 cr for SC/ST schemes Social security: minimum pension of Rs 1000 per month for all subscribers of EPFO scheme National level institute for mental health to be set up Currency notes with braille like signs to help the blind Rs 150 cr on new scheme to improve safety of women in big cities Beti bacahao, beti padahao scheme to be launched – Rs 100 cr allocation Gender main-streaming: School curriculum to have a chapter on the issue MNREGA will be made more productive; it will be linked to agriculture related activities Women SHGs bank loan scheme to be extended to other districts Rural housing scheme: allocation increased to Rs 8000 cr Watershed programme: New prog with outlay of Rs 2000 cr Backward region grant fund for 272 backward districts - BRGF will be restructured Rs 3600 cr for national rural drinking water programme Health for all: free drug and free diagnostic services Four more AIIMS to be set up in AP, WB, Vidharbha and Purvanchal – Rs 500 cr allocation 12 more govt medical colleges to be added Aim to create an AIIMS in every state Govt to provide toilet and drinking water in all girl schools New teachers training scheme is being launched: Rs 500 cr allocated Rs 100 cr for virtual classrooms National Centre of Humanities would be set up in MP Five more IITs and five more IIMs to be set up Pan-India programme called Digital India would be launched – it will provide broadband connectivity to villages 5 new IITs in Jammu, Chhattisgarh, Goa, AP & Kerala 5 new IIMs in HP, Punjab, Bihar, Odisha & Maharashtra Program for upgradation of skills and ancient arts for the minorities Two more research institutes on farming to be set up in Assam and Jharkhand New agri univ in AP, Rajasthan Horticulture univ in Telangana and Haryana National rural and tech mission is proposed – Rs 500 cr allocated New plan to promote community radio – Rs 100 cr allocated Urban renewal to get Rs 50000 cr Urabn metro: govt will encourage metro system in PPP mode Rs 100 cr for Lucknow and Ahmedabad metro projects New mission for low cost affordable housing for urban poor – Rs 4000 cr allocated Easier flow of FDI is also being encouraged in this sector Rs 100 cr for modernisation of madrasas Slum development to be included in Corporate Social Responsibility activities Urban renewal will address drinking water, use of recycled water,solid waste management, digital connectivity; 500 habitats supported 15 Model Rural Health Research centers to be set up for rural health issues Anti-poverty programmes will be targeted well New scheme to provide soil health card to each farmer- Rs 100 cr allocated Climate change is a reality which we have to face – national adaptation fund for climate change to be set up - Rs 100 allocated Finance to 5 lakh joint farming groups through NABARD Price stabilisation fund to be set up - Rs 500 cr allocated State govts to be encouraged to set up farmers markets in cities and town Rs 8 lakh crore target for agriculture credit 3% tax subvention for farmers who pay up on time RIDF target raised to 30000 cr Warehousing: Rs 5000 cr allocated Set up long term rural credit fund to be started by NABARD Rs 5000 cr for STRC fund To set up 100 mobile soil testing labs across country See FY14 growth at 4% Committed to restructuring FCI Kisan Television will be launched this year – this will provide real time info to farmers on farming techniques – Rs 100 cr allocated All the govt departments and ministries will be integrated through e-platform by 31 Dec this year Export proportion mission to be set up Committed to revive SEZs Effective steps to revilatise SEZs SMEs form the backbone of economy Most SMEs are owned and run by SC/STs and OBCs Committee to be set up to look at financing this sector National Industrial Corridor with headquarters in Pune will be set up. Rs 100 crores alloted Apprentice Act to be suitably amended to strengthen the Apprentice Training Scheme 6 more textile clusters to be set up at Bareily, Lucknow, Kutch, Mysore, Bhagalpur and TN Hastkala academy to be set up in Delhi Pashmina production prog in J&K To set up 7 new Industrial Smart Cities Manufacturing units will be allowed to sell products through retail, e-commerce Trade facilitation centre to promote handloom work in Varanasi Ganga inland navigation – jal marg from Allahabad to Haldia at the cost of Rs 4200 cr New scheme to develop new airports in tier 2 and tier 3 cities Road sector needs huge investment NHAI and state highways get 37,000 cr which includes Rs 3000 cr for Northeast New expressways to be developed in parallel to the development on industrial corridors Rs 100 cr for new coal based power generation technology Big solar projects in Rajasthan, TN and Ladakh – Rs 400 cr allocated Current impasse in mining sector will be resolved expeditiously Royalty on mining will be reviewed as suggested by many state governments Capital markets: Need to strengthen regulatory framework Essential to have modern monetary policy framework, Govt to work with RBI on this Liberalise AGR-GDR scheme part Indian capital market to be energized by introduction of single KYC scheme Urgent need to converge Indian accounting standards with international ones Adherence to Indian accounting standards to be made mandatory by 2017 Two bank accounts in each household for marginal sections Banks to be encouraged to give long term loans to industrial sector NPA is a cause of worry 6 new debt recovery tribunals to be set up Insurance penetration is still very low Pending Insurance Amendment Bill to be taken up in Parliament Benefits of insurance have not reached larger section of people, will address in multi-pronged manner with stakeholders Provide all households with banking facilities to empower the weaker sections Committee will be set up to examine how unused money in postal schemes can be utilised Govt committed to providing 24x7 power supply to all homes Chit Fund and Money Circulation Act will be overhauled PPF ceiling upped from Rs 1 lakh to be Rs 1.5 lakh Small savings scheme to be revitalised Capital outlay of defence increased by Rs 5000 cr New war memorial will be constructed at Princess Park – Rs 100 cr allocated Small savings scheme to promote girl child, which will mature at the time of her marriage, higher education will be introduced Renewed effort to link rivers, Rs 100 cr for detailed study on it New scheme Namami Ganga for rejuvenation of River Ganga gets Rs 2,037 cr Rs 990 crore for development of villages along the border Rs 100 cr set aside for development of Technology Development Fund National Police Memorial to be allocated Rs 50 cr Allocation for defence Rs 2,29,000 crore Budget proposes National Housing Banking programme; sets aside Rs 8,000 Rs 500 cr for five tourists circuits National sports academies to be set up in different parts of India Rs 200 cr for upgradation of stadiums in J&K Sports university to be set up in Manipur, Rs 100 allocated Rs 100 cr for training for forthcoming Asian and Commonwealth Games Young leaders prog for youth to be started, Rs 100 cr set aside Displaced Kashmiri migrants rehabilitation gets Rs 500 cr National Centre for Himalayan studies to be set up in Uttarakhand National institute for customs and central excise to be set up in Karnataka Development of rail system in Northeast get Rs 1000 cr over and above what has been provided in interim budget New 24x7 TV channel for Northeast Union govt to help Andhra and Telangana in reorganisation Rs 200 cr for power reforms and Rs 500 cr for water reforms in Delhi Rs 150 cr for communication needs of Andaman and Nicobar Islands Rs 100 cr set aside for development of organic farming in Northeast region Budget estimates: Non-plan expenditure at Rs 12,19,892 crore Non-tax revenue at Rs 2,12,544 crore Revenue deficit pegged at 2.9 percent of GDP Plan expenditure at over Rs 5.75 lakh crore Impact of tax changes have been factored 60 more Ayakar Sewa Kendras to be set up in the country Income Tax Dept is expected to function not only as an enforcement dept but also as a facilitator Net effect of direct tax proposals is revenue loss of Rs 22,200 cr Long-term Capital Gains tax on MFs raised to 20% from 10%
Posted on: Thu, 10 Jul 2014 08:10:06 +0000