BUDGET 2018 QUICK HIGHLIGHTS SECTOR WISE
1. FOR SALARIED PEOPLE and Individuals:
- No change in Tax Rate. All persons including individuals, HUF, Firms and Companies to pay same tax . However Education cess is being increased from 3 to 4 % to be known as *Education and Health cess.
- *Long term Capital gain exemption* under section 10(38) in respect of *listed STT paid shares* being withdrawn. However *capital gain up to 31.1.2018 shall not be taxed* as cost of acquisition will be taken as Fair Market Value as on 31.1.2018.
- Standard Deduction of Rs 40,000 for salaried employees*. However benefit of transport allowance of Rs 19,200 and Medical Reimbursement of Rs 15,000 under Section 17(2) are being withdrawn. Thus net benefit to salaries class only Rs 5,800.
- PAN to be obtained by all entities* including HUF other than individuals in case aggregate of financial transaction in a year is Rs 2,50,000 or more. All directors, partners, members of such entities also to obtain PAN.
- *54EC benefit of investment in Bonds* to be restricted to Capital gain on land and building only. Further period of holding being increased from 3 years to 5 years.
Relief to Senior Citizens
- Exemption of interest income on deposits with banks and post offices are proposed to be increased from Rs. 10,000 to Rs. 50,000
- TDS shall not be required to be deducted under section 194A
- Benefit will also be available for interest from all fixed deposit schemes and recurring deposit schemes
- Hike in deduction limit for health insurance premium and/ or medical expenditure from Rs. 30,000 to Rs. 50,000 under section 80D.
- Increase in deduction limit for medical expenditure increased to Rs. 1 lakh under section 80DDB
2. FOR Companies:
- Domestic Companies having total turnover or gross receipts not exceeding Rs 250 crores in Financial year 2016-17 shall be liable to pay *tax at 25%* as against present ceiling of Rs 50 crore in Financial year 2015-16.
- All companies irrespective of income to file return and in case it is not filed, such companies will be liable for prosecution irrespective of the fact weather it has tax liability of Rs 3,000 or not.
- Assessments to be E assessment under new section 143(3A)
- Customs Duty on mobile phones increased to 20%
- Customs Duty on certain parts of televisions increased to 15 %
- No adjustment under section 143(1) while processing on account of mismatch with 26AS and 16A.
- Deemed dividend to be taxed in the hands of the company itself as Dividend Distribution of tax @ 30%.
- Valuation of Inventory including Securities and Construction Contract income to be computed on percentage completion method as per ICDS.
- Interest on compensation, enhanced compensation. Claim or enhancement claim and subsidy, incentives to be taxed in the year of receipt only as per new Section 145B.
- Conversion of stock in trade to capital asset to be charged as business income in the year of conversion on Fair Market value on the date of conversion.
- Penalty for non filing financial return as required under section 285BA being increased to Rs 500 per day*
3. FOR Agriculture and Rural Sector:
- 100% deduction to companies registered as Farmer Producer Companies with an annual turnover up to Rs. 100 crore.
- MSP for all unannounced Kharif crops increased to 150%
- Institutional credit for agri-sector increased to Rs.10 lakh crore in 2017-18
- Fisheries, aquaculture and animal husbandry corpus at Rs.10,000 crore
- New scheme Operation Greens with an outlay of Rs 500 Crore
- Govt to develop and upgrade existing 22,000 rural haats
- Agri-Market Infrastructure Fund with a corpus of Rs.2000 crore
- Allocation for Ministry of Food Processing doubled to Rs.1400 crore
- Loans to Self Help Groups (SHG) of women to increase to Rs.75,000 crore by March 2019.
- Increased allocation of National Rural Livelihood Mission to Rs 5750 crore
- Under Ujjwala Scheme distribution of free LPG connections will be given to 8 crore poor women
- Housing for All by 2022 – more than one crore houses to be built by 2019 in rural areas
- Plan for employment of 321 crore person days, 3.17 lakh kilometers of rural roads, 51 lakh new rural houses, 1.88 crore toilets, and 1.75 crore new household electric connections
4. FOR Emoulments:
- To revise emoluments to Rs.5 lakh for the President
- Rs 4 lakhs for the Vice President
- 3.5 lakh per month to Governor
- Pay for Members of Parliament – law for automatic revision of emoluments every 5 years
- 150th Birth Anniversary of Mahatma Gandhi- Rs.150 crore for commemoration programme
5. FOR Other Sectors include SMEs Railway, and Health :
- Estimated budgetary expenditure on health, education and social protection at Rs.1.38 lakh crore
- Ekalavya Model Residential School to be set up for tribal children
- Investments for research & infra in premier educational institutions at Rs.1 lakh crore in next 4 years
- Allocation on National Social Assistance Programme at Rs. 9975 crore
- World’s largest government-funded health care programme titled National Health Protection Scheme announced
- NHPS to cover over 10 crore poor and vulnerable families (approximately 50 crore beneficiaries)
- NHPS to provide coverage up to 5 lakh rupees per family per year for hospitalisation
- Rs 1200 crore for the National Health Policy, 2017 – additional Rs.600 crore for TB patients
- 24 new Government Medical Colleges and Hospitals
- Clean Ganga: Of 187 projects have been sanctioned, 47 complete
- Banks of Ganga declared open defecation free
- Major thrust for Medium, Small and Micro Enterprises (MSMEs) – allocation at Rs. 3794 crore
- Target of Rs.3 lakh crore for lending under MUDRA Yojana
- 70 lakh formal jobs to be created this year
- Govt to make 12% contribution of new employees in the EPF for all the sectors for 3 years
- Outlay of Rs.7148 crore for the textile sector
- Increase budgetary allocation on infrastructure for at Rs.5.97 lakh crore
- To develop 10 prominent tourist sites into Iconic Tourism destinations
- 35000 kms road construction in Phase-I at an estimated cost of Rs.5,35,000 crore
- Railways Capital Expenditure pegged at Rs.1,48,528 crore
- 4000 kilometers of electrified railway network slated for commissioning
- Work on Eastern and Western, dedicated freight corridors
- Over 3600 km of track renewal targeted in current fiscal
- Redevelopment of 600 major railway stations
- Mumbai’s local train network to have 90 kilometers of double line tracks at Rs.11,000 crore cost
- 150 km of additional suburban network planned for Mumbai
- Suburban network of 160 km at for Bengaluru metropolis
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