UNION BUDGET HIGHLIGHTS 2016-17

Tax

• Infrastructure and agriculture cess to be levied.
• Excise duty raised from 10 to 15 per cent on tobacco products other than beedis
• 1 per cent service charge on purchase of luxury cars over Rs. 10 lakh and in-cash purchase of goods and services over Rs. 2 lakh.
• 0.5 per cent Krishi Kalyan Cess to be levied on all services.
• Pollution cess of 1 per cent on small petrol, LPG and CNG cars; 2.5 per cent on diesel cars of certain specifications; 4 per cent on higher-end models.
• Dividend in excess of Rs. 10 lakh per annum to be taxed at additional 10 per cent.
• SUVs, Luxury cars to be more expensive. 4% high capacity tax for SUVs.
• Companies with revenue less than Rs 5 crore to be taxed at 29% plus surcharge
• Limited tax compliance window from Jun 1 – Sep 30 for declaring undisclosed income at 45% incl. surcharge and penalties
• Excise 1 per cent imposed on articles of jewellery, excluding silver.

Social

• Rs. 38,500 crore for Mahtma Gandhi MGNREGA for 2016-17
• Swacch Bharat Abhiyan allocated Rs.9,500 crores.
• Hub to support SC/ST entrpreneurs
• Government is launching a new initiative to provide cooking gas to BPL families with state support.
• LPG connections to be provided under the name of women members of family: Rs 2000 crore allocated for 5 years for BPL families.
• 2.87 lakh crore grants to gram panchayats and municipalities – a quantum jump of 228%.
• 300 urban clusters to be set up under Shyama Prasad Mukherji Rurban Mission
• Four schemes for animal welfare.

Education, Skills and Job Creation

• 62 new Navodaya Vidyalayas will be opened
• Sarva Shiksha Abhiyan to increasing focus on quality of education
• Regulatory architecture to be provided to ten public and ten private institutions to emerge as world-class Teaching and Research Institutions
• Higher Education Financing Agency to be set-up with initial capital base of ` 1000 Crores
• Digital Depository for School Leaving Certificates, College Degrees, Academic Awards and Mark sheets to be set-up.

Financial Sector Reforms

• A comprehensive Code on Resolution of Financial Firms to be introduced.
• Statutory basis for a Monetary Policy framework and a Monetary Policy Committee through the Finance Bill 2016.
• A Financial DataManagement Centre to be set up.
• RBI to facilitate retail participation in Government securities.
• New derivative products will be developed by SEBI in the Commodity Derivatives market.
• Amendments in the SARFAESI Act 2002 to enable the sponsor of an ARC to hold up to 100% stake in the ARC and permit non institutional investors to invest in Securitization Receipts.
• Comprehensive Central Legislation to be bought to deal with the menace ofillicit deposit taking schemes.
• Increasing members and benches of the Securities Appellate Tribunal.
• Allocation of ` 25,000 crore towards recapitalisation of Public Sector Banks.
• Target of amount sanctioned under Pradhan Mantri Mudra Yojana increased to ` 1,80,000 crore.
• General Insurance Companies owned by the Government to be listed in the stock exchanges.

Health

• 2.2 lakh renal patients added every year in India. Basic dialysis equipment gets some relief.
• A new health protection scheme for health cover upto 1 lakh per family.
• PM Jan Aushadhi Yojana to be strengthened, 300 generic drug store to be opened National Dialysis Service Prog with funds thru PPP mode to provide dialysis at all district hospitals.
• Senior citizens will get additional healthcare cover of Rs 30,000 under the new scheme

Energy

• Rs. 3000 crore earmarked for nuclear power generation
• Govt drawing comprehensive plan to be implemented in next 15-20 years for exploiting nuclear energy
• Govt to provide incentive for deepwater gas exploration
• Deepwater gas new disc to get calibrated market freedom, pre-determined ceiling price based on landed price of alternate fuels.

Agriculture

• Total allocation for agriculture and farmer welfare at Rs 35984 crores
• 28.5 lakh heactares of land wil be brought under irrigation.
• 5 lakh acres to be brought under organic farming over a three year period
• Rs 60,000 crore for recharging of ground water recharging as there is urgent need to focus on drought hit areas cluster development for water conservation.
• Dedicated irrigation fund in NABARD of Rs.20.000 cr
• Nominal premium and highest ever compensation in case of crop loss under the PM Fasal Bima Yojna.

Banking

• Banks get a big boost: Rs 25,000 crore towards recapitalisation of public sector banks. Jaitley says: Banking Board Bureau will be operationalised, we stand solidly behind public sector banks.
• Target of disbursement under MUDRA increased to 1,80,000 crore
• Process of transfer of government stake in IDBI Bank below 50% started
• General Insurance companies will be listed in the stock exchange
• Govt to increase ATMs, micro-ATMs in post offices in next three years

Investments and infrastructure

• Rs. 27,000 crore to be spent on roadways
• 65 eligible habitats to be connected via 2.23 lakh kms of road. Current construction pace is 100 kms/day
• Shops to be given option to remain open all seven days in a week across markets.
• Rs. 55,000 crore for roads and highways. Total allocation for road construction, including PMGSY, – Rs 97,000 crore
• India’s highest-ever production of motor vehicles was recorded in 2015
• Total outlay for infrastructure in Budget 2016 now stands at Rs. 2,21,246 crore
• 100 per cent FDI in marketing of food products produced and marketed in India
• Dept. of Disinvestment to be renamed as Dept. of Investment and Public Asset Management
• Govt will amend Motor Vehicle Act in passenger vehicle segment to allow innovation.
• MAT will be applicable for startups that qualify for 100 per cent tax exemption
• Direct tax proposals result in revenue loss of Rs.1060 crore, indirect tax proposals result in gain of Rs.20,670 crore
• New greenfield ports to be developed on east and west coasts
• Revival of undeserved airports. Centre to Partner with States to revive small airports for regional connectivity

Roadmap & Priorities

• ‘Transform India’ to have a significant impact on economy and lives of people.
• Focus on enhancing expenditure in priority areas of – farm and rural sector, social sector, infrastructure sector employment generation and recapitalisation of the banks.
• Continue with the ongoing reform programme and ensure passage of the Goods and Service Tax bill and Insolvency and Bankruptcy law.

Rural Sector

• Allocation for rural sector – ` 87,765 crore.
• 2.87 lakh crore will be given as Grant in Aid to Gram Panchayats and Municipalities as per the recommendations of the 14th Finance Commission
• Every block under drought and rural distress will be taken up as an intensive Block under the Deen Dayal Antyodaya Mission
• A sum of ` 38,500 crore allocated for MGNREGS.
• 300 Rurban Clusters will be developed under the Shyama Prasad Mukherjee Rurban Mission
• A new Digital Literacy Mission Scheme for rural India to cover around 6 crore additional household within the next 3 years.
• National Land Record Modernisation Programme has been revamped.
• New scheme Rashtriya Gram Swaraj Abhiyan proposed with allocation of ` 655 crore
• 100% village electrification by 1st May, 2018.
• District Level Committees under Chairmanship of senior most Lok Sabha MP from the district for monitoring and implementation of designated Central Sector and Centrally Sponsored Schemes.
• Priority allocation from Centrally Sponsored Schemes to be made to reward villages that have become free from open defecation.