Highlights of Union Budget 2017-18 as presented by Hon’ble Finance Minister Sh. Arun Jaitley on Feb 01, 2017.

Tax reforms:

1.Existing rate of taxation for individual assesses between income of Rs.2.5 lakhs to Rs. 5 lakhs reduced to 5% from the present rate of 10%

2.Surcharge of 10% for those whose annual income is Rs 50 lakh to 1 crore.

3.Simple one-page form to be filed as Income Tax Return for the category of individuals having taxable income upto Rs. 5 lakhs other than business income

4.Appeal to all citizens of India to contribute to Nation Building by making a small payment of 5% tax if their income is falling in the lowest slab of 2.5 lakhs to 5 lakhs.

5.15% surcharge on incomes above Rs 1 crore to continue.

6.Small firms with turnover up to Rs 50 crore to pay 25% tax now, instead of 30%.

7.Scope of domestic transfer pricing restricted to only if one of the entities involved in related party transaction enjoys specified profit-linked deduction

8.Threshold limit for audit of business entities who opt for presumptive income scheme increased from Rs. 1 crore to Rs. 2 crores. Similarly, the threshold for maintenance of books for individuals and HUF increased from turnover of 10 lakhs to 25 lakhs or income from 1.2 lakhs to 2.5 lakhs

9.Foreign Portfolio Investor (FPI) Category I & II exempted from indirect transfer provision. Indirect transfer provision shall not apply in case of redemption of shares or interests outside India as a result of or arising out of redemption or sale of investment in India which is chargeable to tax in India

10.Commission payable to individual insurance agents exempt from the requirement of TDS subject to their filing a self-declaration that their income is below taxable limit

11.Under scheme for presumptive taxation for professionals with receipt upto Rs. 50 lakhs p.a. advance tax can be paid in one instalment instead of four

12.Time period for revising a tax return is being reduced to 12 months from completion of financial year, at par with the time period for filing of return.

13.Also the time for completion of scrutiny assessments is being compressed further from 21 months to 18 months for Assessment Year 2018-19 and further to 12 months for Assessment Year 2019-20 and thereafter

Goods and Services Tax

1.The GST Council has finalised its recommendations on almost all the issues based on consensus on the basis of 9 meetings held

2.Preparation of IT system for GST is also on schedule.

3.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.

Black Money:

1.Black money SIT has suggested no cash transaction above Rs 3 lakh. The government has accepted this recommendation.

2.Maximum cash donation any party can receive will be Rs 2000 from one source.

3.An amendment being proposed to RBI Act to enable the issuance of electoral bonds for political funding.

4.Government is considering introduction of new law to confiscate assets of offenders who escape the country.

Public Welfare:

1.One crore houses for poor by 2019.

 

2.For senior citizens, Aadhar cards giving their health condition will be introduced.

 

3.Service charge on rail tickets booked through IRCTC to be withdrawn.

 

4.Aadhaar Pay- an app for merchants- to be launched’ 20 lakh aadhaar-based POS by September 2017.

DIGITAL ECONOMY

1.125 lakh people have adopted the BHIM app so far. The Government will launch two new schemes to promote the usage of BHIM; these are, Referral Bonus Scheme for individuals and a Cashback Scheme for merchants

2.Aadhar Pay, a merchant version of Aadhar Enabled Payment System, will be launched shortly

3.A Mission will be set up with a target of 2,500 crore digital transactions for 2017-18 through UPI, USSD, Aadhar Pay, IMPS and debit cards

4.A proposal to mandate all Government receipts through digital means, beyond a prescribed limit, is under consideration

5.Banks have targeted to introduce additional 10 lakh new POS terminals by March 2017. They will be encouraged to introduce 20 lakh Aadhar based POS by September 2017

6.Proposed to create a Payments Regulatory Board in the Reserve Bank of India by replacing the existing Board for Regulation and Supervision of Payment and Settlement Systems

7.Under scheme of presumptive income for small and medium tax payers whose turnover is upto 2 crores, the present, 8% of their turnover which is counted as presumptive income is reduced to 6% in respect of turnover which is by non-cash means

8.Miniaturised POS card reader for m-POS (other than mobile phones or tablet computers), micro ATM standards version 1.5.1, Finger Print Readers / Scanners and Iris Scanners and on their parts and components for manufacture of such devices to be exempt from BCD, Excise/CV duty and SAD

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