In this post, we will be discussing the highlights of financial bill 2017.
The much awaited and debated Budget 2017 was presented today by Honorable Finance Minister Shri. Arun Jaitley amid much speculation after the Demonetization.
While terming it as high on reforms in terms of getting a larger volume of assesses under tax bracket, the budget also has something for farmers, rural population, poor and underprivileged, infrastructure, financial sector and of course encouraging the digital economy, not forgetting public services as well.
This is the first time Railway budget is being combined with the Union Budget.
We bring you the key highlights of the Union Budget 2017, first let us see the tax proposals for FY 2017-18:
- Tax rates for Individuals on Incomes between 2.5 Lakhs to 5 Lakhs reduced from 10% to 5%
- Rebate u/s 87A proposed to be reduced to Rs 2,500 and will be available only for taxpayers having Income up to Rs 3.5 Lakhs
- Surcharge of 10% proposed on income above Rs 50 Lakhs up to 1 Crore.
- Simple One-page ITR form to be introduced for taxpayers with taxable income of up to 5 Lakhs except for Business Income
- Tax rates for Companies with annual turnover up to Rs 50 crores to be reduced to 25% to strengthen MSME sector
- Capital Gains: Holding period for immovable property is reduced to 2 years
- Capital Gains Tax to be exempted for persons holding land from which land was pooled for creation of State of capital of Andhra Pradesh
- MAT credit proposed to be carried forward up to 15 years instead of 10 years
- Threshold limit for audit of entities opting for Presumptive Business u/s 44AD is increased to 2 Crores
- Presumptive Income U/s 44AD for digital receipts is reduced to 6%
- Threshold limit under Section 40A(3) for payment of expenses in cash is reduced to Rs. 10,000
- Under Presumptive taxation for Professionals (44ADA) with Receipts up to 50 Lakhs, Advance Tax to be paid in single installment instead of four.
- The time period for revising Income Tax Return is reduced to 12 months
- 5% TDS On Insurance Agents Removed
- Individuals/HUF paying a Rent exceeding Rs.50000 per month has to Deduct TDS of 5% and to be paid once in year through Challan cum Return Statement, without procuring TAN
- No cash Transactions permitted above Rs 3 lakhs
- Profit-linked deductions for start-ups changed from 3 out of 5 years to 3 years out of 7 years.
- Basic customer duty on LNG to be reduced to 5% to 2.5%
Some of the other key points noted in the budget on the sectors as well:
- Goods and Service tax: Preparation of IT system for GST is also on the 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.
- Demonetization is expected to have a transient impact on the economy. The effects of demonetization will not spill over to the next fiscal.
- Service charge on rail tickets booked through IRCTC to be withdrawn.
- For senior citizens, Aadhar based smart cards containing health condition will be introduced
- The maximum amount of cash donation for a political party will be Rs. 2,000 from any one source
- Head post offices to be used as the front office for Passport services
- Comprehensive web based pension distribution system will be established for defense pensioners
- Payment Regulatory Board is proposed by the Finance Minister to strengthen the digital transactions in India