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Key Features of Budget 2016-2017

Budget - Dated:- 29-2-2016 - INTRODUCTION Growth of Economy accelerated to 7.6% in 2015-16. India hailed as a bright spot amidst a slowing global economy by IMF. Robust growth achieved despite very unfavourable global conditions and two consecutive years shortfall in monsoon by 13% Foreign exchange reserves touched highest ever level of about 350 billion US dollars. Despite increased devolution to States by 55% as a result of the 14th Finance Commission award, plan expenditure increased at RE st .....

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change the lives of our people for the better. Focus on enhancing expenditure in priority areas of - farm and rural sector, social sector, infrastructure sector employment generation and recapitalisation of the banks. Focus on Vulnerable sections through: Pradhan Mantri Fasal Bima Yojana New health insurance scheme to protect against hospitalisation expenditure facility of cooking gas connection for BPL families Continue with the on going reform programme and ensure passage of the Goods and Serv .....

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s undertake important banking sector reforms and public listing of general insurance companies undertake significant changes in FDI policy. AGRICULTURE AND FARMERS WELFARE Allocation for Agriculture and Farmers welfare is ₹ 35,984 crore Pradhan Mantri Krishi Sinchai Yojana to be implemented in mission mode. 28.5 lakh hectares will be brought under irrigation. Implementation of 89 irrigation projects under AIBP, which are languishing for a long time, will be fast tracked A dedicated Long Te .....

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f Fertilizer companies will be provided with soil and seed testing facilities during the next three years Promote organic farming through Parmparagat Krishi Vikas Yojana and 'Organic Value Chain Development in North East Region'. Unified Agricultural Marketing ePlatform to provide a common emarket platform for wholesale markets Allocation under Pradhan Mantri Gram Sadak Yojana increased to ₹ 19,000 crore. Will connect remaining 65,000 eligible habitations by 2019. To reduce the bur .....

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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 theDeen Dayal AntyodayaMission A sum of ₹ 38,500 crore allocated for MGNREGS. 300 Rurban Clusters will be developed under the Shyama Prasad Mukherjee Rurban Mission 100% village electrification by 1st May, 2018. District Level Committees under Chairmanship of senior most Lok Sabha MP from the district for monitoring and implemen .....

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TH CARE Allocation for social sector including education and health care - ₹ 1,51,581 crore. ₹ 2,000 crore allocated for initial cost of providing LPG connections to BPL families. New health protection scheme will provide health cover up to Rs. One lakh per family. For senior citizens an additional top-up package up to ₹ 30,000 will be provided. 3,000 Stores under Prime Minister s Jan Aushadhi Yojana will be opened during 2016-17. National Dialysis Services Programme to be star .....

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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. SKILL DEVELOPMENT Allocation for skill development- ₹ 1804. .....

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ailable to all assesses who are subject to statutory audit under the Act 100 Model Career Centres to operational by the end of 2016-17 under National Career Service. Model Shops and Establishments Bill to be circulated to States. INFRASTRUCTURE AND INVESTMENT Total investment in the road sector, including PMGSY allocation, would be ₹ 97,000 crore during 2016-17. India s highest ever kilometres of new highways were awarded in 2015. To approve nearly 10,000 kmsof National Highways in 2016-17 .....

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r, ultra deep-water and high pressure-high temperature areas Comprehensive plan, spanning next 15 to 20 years, to augment the investment in nuclear power generation to be drawn up. Steps to re-vitalise PPPs: Public Utility (Resolution of Disputes) Bill will be introduced during 2016-17 Guidelines for renegotiation of PPP Concession Agreements will be issued New credit rating system for infrastructure projects to be introduced Reforms in FDI policy in the areas of Insurance and Pension, Asset Rec .....

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cial Data Management 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 a .....

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utonomous Bodies. Bill for Targeted Delivery of Financial and Other Subsidies, Benefits and Services by using the Aadhar frame work to be introduced. Introduce DBT on pilot basis for fertilizer. Automation facilities will be provided in 3 lakh fair price shops by March 2017. Amendments in Companies Act to improve enabling environment for start-ups. Price Stabilisation Fund with a corpus of ₹ 900 crore to help maintain stable prices of Pulses. Ek Bharat Shreshtha Bharat programme will be la .....

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mphasis to sectors such as agriculture, irrigation, social sector including health, women and child development, welfare of Scheduled Castes and Scheduled Tribes, minorities, infrastructure. Mobilisation of additional finances to the extent of ₹ 31,300 crore by NHAI, PFC, REC, IREDA, NABARD and Inland Water Authority by raising Bonds. Plan / Non-Plan classification to be done away with from 2017-18. Every new scheme sanctioned will have a sunset date and outcome review. Rationalised and re .....

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ented houses. BOOST EMPLOYMENT AND GROWTH Increase the turnover limit under Presumptive taxation scheme under section 44AD of the Income Tax Act to ₹ 2 crores to bring big relief to a large number of assesses in the MSME category. Extend the presumptive taxation scheme with profit deemed to be 50%, to professionals with gross receipts up to ₹ 50 lakh. Phasing out deduction under Income Tax: Accelerated depreciation wherever provided in IT Act will be limited to maximum 40% from 1.4.2 .....

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nked or investment linked deductions and do not avail of investment allowance and accelerated depreciation. Lower the corporate tax rate for the next financial year for relatively small enterprises i.e companies with turnover not exceeding ₹ 5 crore (in the financial year ending March 2015), to 29% plus surcharge and cess. 100% deduction of profits for 3 out of 5 years for startups setup during April,2016 to March,2019. MAT will apply in such cases. 10% rate of tax on income from worldwide .....

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debts. Determination of residency of foreign company on the basis of Place of Effective Management (POEM) is proposed to be deferred by one year. Commitment to implement General Anti Avoidance Rules (GAAR) from 1.4.2017. Exemption of service tax on services provided under Deen Dayal Upadhyay Grameen Kaushalya Yojana and services provided by Assessing Bodies empanelled by Ministry of Skill Development & Entrepreneurship. Exemption of Service tax on general insurance services provided under Ni .....

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, chemicals & petrochemicals, paper, paperboard & newsprint, Maintenance repair and overhauling [MRO] of aircrafts and ship repair. MOVING TOWARDS A PENSIONED SOCIETY Withdrawal up to 40% of the corpus at the time of retirement to be tax exempt in the case of National Pension Scheme (NPS). Annuity fund which goes to legal heir will not be taxable. In case of superannuation funds and recognized provident funds, including EPF, the same norm of 40% of corpus to be tax free will apply in res .....

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ndertaking in housing project for flats upto30 sq. metres in four metro cities and 60 sq. metres in other cities, approved during June 2016 to March 2019 and completed in three years. MAT to apply. Deduction for additional interest of ₹ 50,000 per annum for loans up to ₹ 35 lakh sanctioned in 2016-17 for first time home buyers, where house cost does not exceed ₹ 50 lakh. Distribution made out of income of SPV to the REITs and INVITs having specified shareholding will not be sub .....

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of 10% of gross amount of dividend will be payable by the recipients receiving dividend in excess of ₹ 10 lakh per annum. Surcharge to be raised from 12% to 15% on persons, other than companies, firms and cooperative societies having income above ₹ 1 crore. Tax to be deducted at source at the rate of 1 % on purchase of luxury cars exceeding value of Rs. ten lakh and purchase of goods and services in cash exceeding Rs. two lakh. Securities Transaction tax in case of Options is propos .....

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on diesel cars of certain capacity and 4% on other higher engine capacity vehicles and SUVs. No credit of this cess will be available nor credit of any other tax or duty be utilized for paying this cess. Excise duty of 1% without input tax credit or 12.5% with input tax credit on articles of jewellery [excluding silver jewellery, other than studded with diamonds and some other precious stones], with a higher exemption and eligibility limits of ₹ 6 crores and ₹ 12 crores respectively. .....

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d not sale of intangible goods. PROVIDING CERTAINITY IN TAXATION Committed to providing a stable and predictable taxation regime and reduce black money. Domestic taxpayers can declare undisclosed income or such income represented in the form of any asset by paying tax at 30%, and surcharge at 7.5% and penalty at 7.5%, which is a total of 45% of the undisclosed income. Declarants will have immunity from prosecution. Surcharge levied at 7.5% of undisclosed income will be called Krishi Kalyan surch .....

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fresh cases where assessing officer applies the retrospective amendment. One-time scheme of Dispute Resolution for ongoing cases under retrospective amendment. Penalty rates to be 50% of tax in case of underreporting of income and 200% of tax where there is misreporting of facts. Disallowance will be limited to 1% of the average monthly value of investments yielding exempt income, but not exceeding the actual expenditure claimed under rule 8D of Section 14A of Income Tax Act. Time limit of one .....

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