Finance Minister Arun Jaitley on February 29 unveiled a largely pro-poor Budget for 2016-17 increasing social spending and farm credit in a bid to revive the rural economy without overspending. His proposals courted both bouquets and brickbats. While the Minister shunned populism by balancing the key priorities of investment, growth and jobs, he left the salary earners high and dry by making no changes in the personal or corporate income-tax slabs.
Much to the dismay of Indian salary earners, Finance Minister Arun Jaitley’s third Union Budget presented in Parliament on February 29 provides only little tax relief for them but puts burden on the common man by trying to mop up an additional Rs 19,610 crore through a set of tax proposals.
In the words of Jaitley, “My direct tax proposals would result in a revenue loss of Rs 1,060 crore and my indirect proposals are expected to yield Rs 20,670 crore. Thus, the net impact of all tax proposals would be a revenue gain of Rs 19,610 crores.”
His proposals include a relief for small taxpayers, a 3 per cent hike in surcharge on the super rich, new levies on cars and SUVs and a compliance window for domestic black money holders, though on the spending side a huge Rs 1.77 lakh crore has been earmarked for rural areas to address the agrarian distress.
The Minister left the salary earners high and dry by making no changes in the personal or corporate income-tax slabs but made costlier several items, including electricity, jewellery, readymade garments, mineral water and aerated drinks, tobacco and cigarettes by raising duties on them.
Announcing measures for India moving towards a pensioned society, Jaitley said, “Pension schemes offer financial protection to senior citizens. I believe that the tax treatment should be uniform for defined benefit and defined contribution pension plans.”
This story is from the March 1 2016 edition of Bureaucracy Today.
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This story is from the March 1 2016 edition of Bureaucracy Today.
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