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Summary of Budget 2018-19

Budget is an Annual financial statement of the evaluated receipts and expenditure of the Government for the financial year. Finance Minister Arun Jaitley presented the Union Budget for the financial year 2018-19 on February 1.

This year’s budget session is pivotal as it came after two very big financial decisions made last year – Demonetization and implementation of the Goods and Services Tax (GST). The Budget is designed to optimally assign the Government’s resources to different sectors and schemes, so that the broad objectives of the government could be achieved. It presents government’s proposed revenues and expenditure for the coming financial year. It is a means to develop a liaison between the money spent by a government and the results which follow.

Budget 2018 Takeaways

As per the Finance Minister in the Union Budget, India is expected to become the fifth largest economy very soon. India has Rs 2.5 trillion economy.

  • Exports are expected to grow 15% in 2018.
  • As per the Finance Minister, Minimum Support Price (MSP) of all crops shall increase to at least 1.5 times that of the production cost.
  • Agricultural corpus worth Rs 2000 crore will be set up. 470 APMCs have been connected to e-NAM network, the rest to be connected by March 2018.
  • In all, Rs 10 lakh crore to Rs 11 lakh crore is credited for agricultural activities.
  • Ujjwala Yojana, the free LPG connection scheme expanded to eight crore households.
  • The government will provide 4 crore electricity connections to the poor under Saubhagya Yojana.
  • The government will establish a dedicated affordable housing fund.
  • Government proposes to launch the Revitalizing of Infrastructure and Systems of Education (RISE) by next year.
  • 18 new schools of planning and architecture will be set up in the IITs and NITs.
  • 2 major initiatives as part of Ayushman Bharat program.
  • 24 new government medical college & hospitals and Rs. 600 crore for nutritional support to all TB patients.
  • Govt. is launching a new national health protection scheme – Rashtriya Samaj Beema Yojana. This will have 50 crore beneficiaries and 10 crore families will get 5 lakh per year for their families to cover secondary and tertiary hospital expenses. This is the world’s largest government-funded healthcare program.
  • PM Jeevan Beema Yojana benefited more than 2 crore families.
  • Jan Dhan Yojana will be extended to all 60 crore bank accounts.
  • The government increased allocation for SC-ST earmarked programmes: Rs 56,000 crore for SCs and Rs 39,000 crore for STs.
  • By 2022, every block with more than 50% ST population and at least 20,000 tribal people will have ‘Ekalavya’ school at par with Navodaya Vidyalas.
  • As per the budget, Rs. 3 lakh crore for lending under is being allocated in FY 19 for PM’s MUDRA Yojana.
  • Rs. 7148 crore allocation for the textile sector.
  • Under the Smart City mission, 99 cities selected with the outlay of Rs. 2.04 lakh crores.
  • EPF contribution has been reduced to 8% for the first 3 years of employment and 12% government contribution to EPF in sectors employing a large number of people, however, there will be no changes in employer contribution.
  • 10 tourist cities to be developed into iconic tourist destinations.
  • The Bharatmala project has been approved and we are confident of completing 9000 km of highway.
  • Government is moving towards optimum electrification of the railway. Over 3,600 km of track renewal is being targeted in 2018-19.
  • Airport capacity to be hiked to handle 1 billion trips per year.
  • Govt. to eliminate over 4,267 unmanned level crossings in the next two years.
  • Rs. 17,000 crore is being set aside for Bengaluru Metro.
  • UDAN will connect 56 unserved airports and 36 unserved heliports.
  • The government announced AMRUT program to focus on water supply to all households in 500 cities. Water supply contracts for 494 projects worth 19,428 crore will be awarded.
  • Proposal for Railway University in Vadodara.
  • Niti Aayog to establish a national program to direct efforts in artificial intelligence.
  • Allocation of Digital India has been doubled and the government proposes to set up 5 lakh WiFi hotspots.
  • Government does not consider cryptocurrency as legal tender and will work towards eliminating illicit transactions going on through crypto assets.
  • Disinvestment target of Rs. 80,000 crore for 2018-19.
  • The government will involve a scheme to assign every enterprise a unique ID just like Aadhaar.
  • Gold monetization scheme to be revamped.
  • Government revised fiscal deficit for 2017-18 was Rs 5.95 lakh crore or 3.5% of GDP. Finance Minister Arun Jaitley projects deficit of 3.3% of GDP next fiscal.
  • Government insurance companies to be merged into a single entity, and subsequently listed in the stock exchange, as part of the disinvestment programme.
  • Salaries of President, VP and Governors will be increased. Rs. 5 lakh for President, Rs 4.0 lakh for VP and Rs 3.5 lakh for governors. Salaries of Members of Parliament will also be raised.
  • A new law will be introduced that will automatically revise MPs’ emoluments every five years, indexed to inflation.
  • Govt. announced Rs 150 crore fund to celebrate the 150th anniversary of Mahatma Gandhi.
  • GST revenue for only 11 months, instead of the usual 12 months, is 21.5 lakh crore.
  • Number of tax payers has increased from 6.47 lakh crores to 8.27 lakh crores.
  • Government to set up two industrial defense industrial development corridors in 2018-19.
  • 100% tax deduction for the first five years to companies registered as farmer producer companies with a turnover of Rs 100 crore and above.
  • Employment-based tax incentives will be extended to footwear and leather industry.
  • The benefits of corporate tax by bringing down the tax rate to 25% for firms that reported turnover up to Rs 250 crores.
  • No change in income tax slabs, but assesses can avail of a standard deduction of Rs 40,000.
  • Relief on tax for senior citizens from income coming from bank interest increased from 10,000 to 30,000.
  • Standard deduction is in lieu of travel and medical expense reimbursement, which amounts to Rs 30,000. So the actual tax benefit would Rs 10,000 for each taxpayer.
  • Customs duty increased on mobile phones from 15% to 20%.
  • Estimates 1.38 trillion rupees expenditure on health, education and social security. Railway capital expenditure set at 1.49 trillion rupees for 2018/19.

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Summary of Budget 2018-19

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