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Union Budget 2016-17 Highlights : Cigarettes Cars to Become Expensive

Union Budget 2016-17 Highlights
Written by Team Maffat

Union Finance Minister Mr. Arun Jaitley on 29th February 2016, Monday announced his 3rd Budget speech in Parliament. The Finance Minister said that the country is beefing up its economy at a time when the world is weathering through an economic crisis.

Arun Jaitley said, “The Current Account deficit has declined from 18.4 billion US dollars in the first half of last year to 14.4 billion this year. It is projected to be 1.4% of GDP at the end of this year. Our foreign exchange reserves are at the highest ever level of about 350 billion US dollars.”

Following are the highlights of Union Budget 2016-17 presented by Finance Minister Arun Jaitley in Parliament:


No change in personal Income Tax slabs


4-month Compliance Window for domestic black money holders; tax, interest on them at 45%


Relief for tax payers who earn below Rs 5 lakh; ceiling of rebate u/s 87A raised to Rs 5,000 from Rs 2,000


House rent deduction raised from Rs 20,000 to Rs 60,000


One-time dispute resolution scheme for retro tax cases, penalty, interest waived


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To achieve fiscal deficit of 3% of GDP by (2017-18)


Fiscal Deficit target 3.9% in 2015-16, 3.5% in 2016-17


Revenue Deficit to be 2.8% in 2015-16


Current Account Deficit for 2015-16 at $14.4 billion or 1.4% of GDP


Forex reserves at highest at $350 billion


High level committee headed by Revenue Secretary to oversee creation of fresh liability using retro tax law


Corporate Tax for new manufacturing units fixed at 25%


Clean energy cess increased from Rs 200/ton to 400/ton on coal, lignite and peat


First home buyers to get addl deduction of Rs 50,000 on interest for loan up to Rs 35 lakh; cost of house should not be more than Rs 50 lakh


Budget lists 9 transformative pillars including doubling farm income by 2022, infrastructure, investment, reforms


Highest ever allocation of Rs 38,500 cr for MGNREGA


Certain equipment for dialysis exempt from basic customs duty, excise CVD


Govt to circulate Model Shops and Establishment Bill, small retail shops may remain open for 7 days


100% rural electrification by May 1, 2018


Govt to pay EPF contribution of 8.33% of new employees for first 3 years.


Start-ups to get 100% tax exemption for 3 years except MAT which will apply from April 2016-2019


To give statutory status to Aadhaar programme


Infrastructure outlay at Rs 2.21 lakh cr


Rs 35,984 crore earmarked for farmer welfare; to spend Rs 86,500 crore on irrigation in 5 years


Rs 20,000 crore irrigation fund to be set up under NABARD


Roads and highways allocation at Rs 55,000 crore; NHAI can issue tax free bonds.


Long term capital gains for unlisted companies to be reduced from 3 to 2 years


Rs 9,000 crore allocated to Swachh Bharat Abhiyaan


Rs 2,000 crore for LPG connection to poor; scheme for MPG connection for women


Stand Up India allocated Rs 500 crore


Targets 10,000 km national highways, upgradation of 50,000 kms of state highways


Incentivise gas production from deep sea, other unutilised deep sources


Rs 31,300 cr Infra Bonds to be issued by various agencies — NHAI, IREDA, NABARD


Further relaxation of FDI rules in insurance, pension, stock exchanges, asset reconstruction companies


100% FDI in food products made domestically


Rs 25,000 cr for recapitalisation of PSU banks


Department of Disinvestment renamed Department of  Investment & Public Asset Management


NITI Aayog to identify CPSEs for strategic sale


To design framework for PSU bank consolidation


To consider lowering govt stake in IDBI to below 50%


Health insurance scheme to provide Rs 1 lakh per family


Senior citizens to get additional healthcare cover of Rs 30,000 under the new scheme


Comprehensive Code for providing specialised resolution mechanism for bankruptcy of banks/insurance firms


To amend Companies Act for registration of firms in a day


GAAR to be implemented from April 1, 2017.


Legislation to deal with the menace of illicit deposit taking schemes


Place of Effective Management rules deferred by a year


Withdrawal up to 40% of the corpus at the time of retirement to be tax exempt in the case of NPS


Steps to re-vitalise Public-Private-Partnership mode


Public Utility Bill to be introduced, Guidelines for renegotiation of PPP Concession Agreements


New credit rating system for infrastructure projects


Interest rate setting Monetary Policy Committee in 2016.


Krishi Kalyan Cess at 0.5% on all taxable services from June 1, 2016


Infrastructure cess at 1% on small petrol, LPG, CNG cars, 2.5% on diesel cars of certain capacity and 4% on other higher engine capacity vehicles, SUVs


Excise duties on various tobacco products other than beedi raised by about 10 to 15%


RBI to facilitate retail participation in G-Secs


New derivative products to be developed by SEBI


PSU General Insurers to be listed in stock exchanges


Review and rationalisation of Autonomous Bodies


Plan, non-Plan distinction to be done away with; a Committee to review FRBM


Amount sanctioned under Pradhan Mantri Mudra Yojana increased to Rs 1.80 lakh crore


Govt to increase ATMs, micro-ATMs in post offices


Service Tax to be exempted on general insurance schemes under NIRMAYA Scheme.


DBT to be used to transfer subsidy on fertiliser in select districts on pilot basis


Service tax on Single premium Annuity Policies reduced from 3.5% to 1.4% of the premium paid in certain cases


10% tax rate on income from worldwide exploitation of patents developed and registered in India by a resident


NBFCs to get deduction of 5% of its income in respect of provision for bad and doubtful debts


Basic custom and excise duty on refrigerated containers reduced to 5% and 6%


100% deduction for profits in housing project for flats up to 30 sq metres in four metros; 60 sq mts in other cities, approved during June 2016 to March 2019 and completed in 3 years. MAT to apply.


Agriculture credit target highest at Rs 9 lakh crore


Unified agriculture market e-platform will be dedicated to the nation on the birthday of B R Ambedkar


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