DIRECT TAX
** 99.54% of Income tax Returns thus filed have been accepted as having been filed without any scrutiny.
** Standard Deduction limit raised to Rs. 50,000/- from the existing Rs. 40,000/- {Section 16(IA)}
** Tax on deemed rent from 2ND house abolished. This means that the benefit of self-occupied property has
been increased from one house property to two house properties. The income tax on notional rental
income will not be taxed on the second house property {section 23(4)}.
** The limit for tax rebate under section 87A increased from Rs. 3,50,000/- to Rs. 5,00,000/- , thereby the
tax savings would be Rs 12,500/- instead of earlier Rs. 2,500/-. This means that for a taxable income up
to Rs. 5,00,000/- there would be “ZERO” tax. Around 3 crore Tax Payers would be benefitted by this
** TDS on bank deposits/Post office Savings deposit increased to Rs 40,000/- from Rs. 10,000/- {Section
194A}.
** TDS limit for rent from properties has been increased to Rs. 2,40,000/- from Rs. 1,80,000/- {Section 194I}.
** Within next 2 years almost all verification/assessments of the tax returns selected for scrutiny will be done
electronically manned by tax experts/officials without any manual intervention and without any interface
between tax payers and tax officials
** It is proposed that within next 2 years income tax returns will be processed in 24 hours and refund will be
issued simultaneously.
** Exemption under Section 54 will be available on the purchase of two house properties provided the capital
gain is up to Rs 2.00 Crore. The benefit can be availed only once in a lifetime.
AGRICULTURE
** Farmers owning land up to 2 hectares to get Rs. 6,000/- per anum under Pradhan Mantri Kissan Yojna 12
crore Farmers to be benefitted under the scheme.
** Farmers affected by natural calamities to get 2% interest subvention and additional 3% interest
subvention for timely repayment of loan
** Farmers pursuing the activities of animal husbandry and fisheries, who avail loan through Kisan Credit Card
to get 2% interest subvention and further 3% interest subvention in case of timely repayment.
OTHERS
**Proposed Pension scheme under Pradhan Mantri Shram-Yogi Maandhan. Pradhan Mantri Shram-Yogi
Maandhan that offers a pension of Rs. 3000/- per month after the age of 60 to unorganised sector workers
with monthly income of up to Rs. 15000/-. Under the scheme, an unorganised sector worker joining pension
Yojana at the age of 29 years will contribute Rs 100/- per month till the age of 60 while a worker joining at
the age of 18 will have to contribute Rs. 55/- per month. This would be matched by an equal contribution by
the government to the pension account. This is being termed as the World’s biggest pension scheme.
Around 42 Crore unorganised sector workers would be benefitted by this.
**Time limit for attachment of property under Prevention of Money Laundering Act 2002, to be hiked from 90
days to 365 days.
**To promote “ Make in India” concept , the Customs duty to be abolished on 36 capital goods.
MSME SECTOR
**GST registered SME enterprises will get 2% rebate on interest charged to them on their loans up to Rs. 1
crore.
**SME with a turnover of up to Rs. 5 crore to file GST returns on quarterly basis as against the monthly returns
as of now.
DEFENCE
** Defence Budget to cross Rs. 3,00,000 lakh crore for the first time ever.
In our opinion this interim budget is populist and election oriented budget for the benefit of lower and lower middle class. These provisions will put a stress on the fiscal deficit of the country.
This post first appeared on IMPACT OF DEMONITIZATION OF CURRENCY IN INDIA IN 2016, please read the originial post: here