Wednesday, February 1, 2017

".....the winds favour me and I fly", says Arun Jaitley: Budget 2017-18 woos farmers, middle class and industry in Please-All Fiscal proposals

Finance Minister Arun Jaitley today sounded optimistic more than once and in his spirited speech, waxed eloquently, highlighting measures aimed to augment investment and also improve rural economy, but at the same time, ensure upholding of economic prudence.

"It is said when my goal is in sight, the winds favour me and I fly. There is no other day more appropriate than this," Mr Jaitley said in his concluding remarks. Earlier, he said he began the budget speech stating, "Spring is a season of optimism".

Constrained by code of conduct in view of assembly elections in five states including Uttar Pradesh while the government could not announce major sops for these poll-bound states, the Budget 2017-18, however, sought to target the agrarian community with enhanced budget allocation for major schemes focusing on farmers.
Finance Minister Arun Jaitley today announced a whopping Rs 1 lakh crore hike in the credit target for the next fiscal to Rs 10 lakh crore as part of the government’s efforts to double farm incomes. 
The government's commitment to double farm income by 2021 was announced in last year's budget.
Mr Jaitley while presenting Budget in the Lok Sabha, said, the target for agricultural credit in 2017-18 has been fixed at a record level of Rs 10 lakh crore and added: "We will take special efforts to ensure adequate flow of credit to the under serviced areas, the eastern states and Jammu and Kashmir". Moreover, the Finance Minister said a  dedicated  Micro  Irrigation  Fund  will  be  set  up  in  NABARD  to achieve the goal, ‘per drop more crop’. "The Fund will have an initial corpus of Rs 5,000 crore". 

Jaitley at his sarcastic best: Mocks at citizens' tax evading habits

New Delhi, Feb 1 (UNI) A good orator that he is, Finance Minister Arun Jaitley today made optimum use of his glib talk ability and was at his sarcastic best hitting out at the common citizenry for what is generally given out as the national habit to evade tax payment. 

"I  place before  you  certain  data  to  indicate  that  our  direct  tax  collection  is  not commensurate  with the  income  and consumption pattern of  Indian economy," Finance Minister said in budget speech presented in the Lok Sabha. "The  number  of  people  showing income more than Rs 50-lakh in the entire country is only 1.72-lakh.  We can contrast  this  with the  fact  that  in  the  last  five  years,  more  than 1.25-crore cars have been sold, and number of Indian citizens who flew abroad, either for business or tourism, is two crores in the year 2015.  From all these figures we  can  conclude  that  we  are  largely  a  tax  non-compliant  society," Mr Jaitley said even as a number of members were seen giggling or whispering to each other. India’s tax to GDP ratio is very low, and the proportion of direct tax to  indirect  tax  is  not  optimal  from  the  view  point  of  social  justice, Mr Jaitley said. 

Finance Minister elaborated that  as  against  estimated 4.2 crore persons engaged  in  the organised sector employment, the   number of   individuals filing return   for   salary income are only 1.74 crore. "As against 5.6 crore informal sector individual enterprises and firms  doing  small  business  in  India,  the  number  of  returns filed by this category are only 1.81 crore".

He said out of the 13.94 lakh companies registered  in India  upto  31st March,  2014; 5.97  lakh companies  have  filed their  returns  for  Assessment  Year  2016. He said of  the 5.97  lakh companies which have filed their returns for Assessment Year 2016-17 so far, as many as 2.76  lakh companies have  shown losses  or  zero  income. About 2.85  lakh companies have  shown profit  before  tax  of  less  than Rs 1  crore, while  28,667 companies  have shown  profit  between 1 crore to 10  crore and  only 7781 companies have profit before tax of more than Rs 10 crores.

Trying to put an argument in justification of the need for citizens to pay tax, he said, "When too many people evade taxes, the burden of their share falls on those who are honest and compliant." "I appeal  to  all  citizens  of  India  to  contribute  to  Nation Building  by  making  a small payment of 5 percent tax if their income is falling in the lowest slab of Rs 2.5 lakhs to Rs 5 lakhs," Mr Jaitley said.

Budget gives a push to digital economy, note ban to ensure bigger GDP: FM

New Delhi, Feb 1 (UNI) The Budget 2017-18 presented in Parliament today seeks to give a major push to the digital economy and weed out corruption and black money, Finance Minister Arun Jaitley said here even as he asserted that the demonetisation drive announced in November will ensure a cleaner economy and bigger GDP.
"Demonetisation seeks to create a new ‘normal’ wherein the GDP would be bigger, cleaner and real.The exercise is part of the Government’s resolve to eliminate corruption, black money, counterfeit currency and terror funding," Mr Jaitley said in his one-and-half-hour long speech.
Giving digital economy as envisioned by Prime Minister Narendra Modi, the Finance Minister said the government has decided that no transaction above Rs 3 lakh will be permitted in cash.

This decision has been taken by the government following the recommendation of Special Investigation Team on black money to ban cash transactions above Rs 3 lakh, the Finance Minister said.
On this there will be a necessary amendment to the Income Tax Act in the Finance Bill.
"Promotion of a digital economy is an integral part of Government’s strategy to clean the system and weed out corruption and black money.  It has a  transformative impact in      terms   of   greater formalisation of      the economy  and  mainstreaming  of  financial  savings  into  the  banking  system," he said amid thumping of desks by treasury benches.
"This,  in  turn,  is  expected  to  energise  private  investment  in  the country. India  is now  on the  cusp  of  a  massive  digital revolution," said Mr Jaitley.
The Finance Minister strongly defended the demonetisation drive as announced by the government in November, 2016 and said, "This exercise is part of our government’s resolve to eliminate corruption, black money, counterfeit currency and terror funding.  Like all reforms, this measure is obviously disruptive, as it seeks to change the retrograde status quo". Mr Jaitley maintained that demonetisation  of high  denomination notes was in continuation  of  a  series  of  measures  taken  by  the government. "It is a bold and decisive measure.  

For several decades, tax evasion  for  many  has  become  a  way  of  life.  This  compromises  the larger public interest and creates unjust enrichment in favour of the tax evader, to the detriment of the poor and deprived," he said, adding, this has bred a "parallel economy" -- which  is  "unacceptable"  for  an  inclusive  society.       
"Demonetisation  seeks  to create a new ‘normal’ wherein the  GDP  would  be  bigger,  cleaner  and  real," he said. 
The Finance Minister contended that the demonetisation has "strong potential to generate long term benefits" in  terms      of   reduced   corruption, greater      digitisation   of economy,  increased flow      of   financial   savings and      greater   formalisation of   the economy. 
"Demonetisation helps to transfer resources from the tax evaders to  the  government,  which  can  use  these  resources  for  the  welfare  of  the poor and the deprived," he explained.
"A  shift to  digital payments  has  huge benefits  for the  common  man," he said.


Tail Piece: Laughter Dose

Politicians know how to make things appear light even during serious and solemn moments and thus the Budget presentation in the Lok Sabha today was punctuated with various lighter moments and at times the members also burst into peals of laughter.
There were lighter moments and members from both sides seem to like the joyous remarks from Finance Minister Arun Jaitley, when he referring to a Hindi verse, said, "hum agey agey...hae, ayie aap...(We are ahead of you, please follow us)".

The gestures prompted mild laughter even from Mr Jaitley's wife Ms Sangeeta, who was seated with her daughter in the VIP visitors' gallery. The budget presentation by Jaitley -- his fourth -- was also witnessed by his wife and daughter from the VIP gallery.
Similar lighter moment was witnessed when Finance Minister announced that the maximum amount of cash donation that can be received by political parties is Rs 2,000 only. In fact, trying to take a potshot at opposition bench many BJP members thumped desks and also laughed mildly. The mention of certain measures to bring about electoral reforms and 'political funding' also saw Congress Vice-president Rahul Gandhi interacting with his colleague Kamal Nath and exchanging notes.
The RPI leader and Union Minister of State for Social Justice and Empowerment Ramdas Athawale also led members into jovial mood more than once.
On one occasion, he stood up when Mr Jailey mentioned about BHIMApp that gives an easy method of payment and fund transfer. "See what we are doing," he tried to tell the opposition members. Similarly, he again was on his feet when the Finance Minister announced there will be overall increase of 35 percent in fund allocation for Scheduled Castes people.
Athawale's maverick style also left a mark apparently with Prime Minister Narendra Modi, who at the end of day's session was seen shaking hands and interacting jovially with the RPI leader.


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