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Budget’s thrust on stimulating growth, relief to Middle Class, Affordable Housing, Curbing Black Money, promoting Digital Economy, transparency of Political Funding and simplification of Tax Administration

Budget - Dated:- 1-2-2017 - Budget s thrust on stimulating growth, relief to Middle Class, Affordable Housing, Curbing Black Money, promoting Digital Economy, transparency of Political Funding and simplification of Tax Administration Government committed to eliminate Black Money component from the economy MSME companies to pay income tax @ 25% Custom duty on LNG reduced from 5% to 2.5% Small and medium tax payers to pay less under presumptive income tax scheme Measures announced to ensure transp .....

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relief to middle class, affordable housing, curbing black money, promoting digital economy, transparency of political funding and simplification of tax administration. Presenting the overall economic scenario of the country, Shri Jaitley said that we are largely a tax non-compliant society. Among the 3.7 crore individuals who filed the tax returns in 2015-16, only 24 lakh people show income above ₹ 10 lakh. Of the 76 lakh individual assesses who declared income above ₹ 5 lakh, 56 lak .....

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e our taxation rates more reasonable, our tax administration more fair and expand the tax base in the country. Presenting a revealing picture after the demonetization, he said that during the period from 8th November to 30th December, 2016 deposits between ₹ 2 lakh and ₹ 80 lakh were made in about 1.09 crore accounts with an average deposit size of ₹ 5.03 lakh. Deposits of more than ₹ 80 lakh were made in 1.48 lakh accounts with average deposit size of ₹ 3.31 crore. .....

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es in the current financial year even after demonetization have shown a remarkable surge. Mentioning the measures for promoting affordable housing in real estate sector, the Finance Minister said that the scheme for profit linked income tax exemption for promoters of affordable housing will be broad based. Instead of built-up area of 30 and 60 sq. mtrs., the carpet area of 30 and 60 sq. mtr. will be counted. Also the 30 sq. mtr. will apply only in case of municipal limits of four metropolitan ci .....

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ng, Shri Arun Jaitley said that the holding period for considering gain from immovable property is being reduced to two years from existing three years now. Also, the base year for indexation is proposed to be shifted from 1.4.1981 to 1.4.2001 for all classes of assets including immovable property. In respect of new capital for State of Andhra Pradesh, persons holding land on 2.6.2014 whose land is being pooled for creation of new capital city under the Government Scheme, will be exempted from c .....

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continues. Also, the profit linked deduction available to the start ups for three years out of five years is being changed to three years out of seven years. Shri Arun Jaitley said that it is not practical to remove or reduce Minimum Alternate Tax (MAT). However, in order to allow companies to use MAT credit in future years, carry forward of MAT upto a period of 15 years instead of 10 years at present will be allowed. Announcing tax benefits to medium and small enterprises to make them more via .....

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llowable provision for non performing asset is being increased to 8.5% from 7.5%. This will reduce the tax liability of Banks. In respect of NPA accounts, interest receivable on actual receipts instead of accrual basis will be taxed. This will remove hardship of having to pay tax even when interest income is not realized. Shri Jaitley further announced reduction in basic custom duty on LNG from 5% to 2.5% in view of wide range of use of LNG as fuel as well as feed stock for petro-chemical sector .....

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erials to reduce costs have been submitted for certain items like Liquefied Natural Gas (LNG), Nickel, Vegetable Tanning Extracts and certain Capital Goods. Proposal to hike Excise duties and to levy additional duties under Sec 85 of the Finance Act, 2005 on several tobacco and tobacco related products have also been made in the Budget. Mentioning measures to promote digital economy/cashless transactions, Shri Arun Jaitley said that BCD, Excise/CV duty and SAD on miniaturized POS card reader for .....

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haritable trust is being reduced to ₹ 2000 from ₹ 10,000. As regards, scheme of presumptive income tax for small and medium tax payers whose turnover is upto ₹ 2 crore, 6% of their turnover instead of 8% at present will be counted as presumptive income. Expressing concern over funds being received by political parties through anonymous donations shown in cash, Shri Jaitley said that the measures taken in the past to check such donations has only marginally improved the situatio .....

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the issuance of electoral bonds in accordance with a scheme to be framed by the Government in this regard. Under this Scheme, a donor could purchase bonds from authorized Banks against cheque and digital payments only. They shall be redeemable only in the designated account of a registered political party. These bonds will be redeemable within the prescribed time limit from issuance of bond. d) Every political party would have to file its return within the time prescribed in accordance with the .....

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rly, threshold maintenance of books for individuals and HUF is being increased from turnover of ₹ 10 lakh to ₹ 25 lakhs or income from ₹ 1.2 lakh to ₹ 2.5 lakh. Shri Jaitley further announced to exempt Foreign Portfolio Investor (FPI) Category I & II from indirect transfer provision. Indirect transfer provision will not be applicable in case of redemption of shares or interests outside India as a result of or arising out of redemption or sale of investment in India wh .....

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m completion of financial year to allow the people to claim the refund expeditiously. Also, the time for completion of scrutiny assessment is being compressed further from 21 months to 18 months for assessment year 2018-19 and further to 12 months for assessment year 2019-20 and thereafter. Giving details of proposals on personal income tax, the Finance Minister said that the existing rate of taxation for individual assesses between income of ₹ 2.5 lakh to ₹ 5 lakh will be reduced to .....

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ng income upto ₹ 3 lakh per annum. And the tax liability will only be ₹ 2500 for people with income between ₹ 3 and 3.5 lakh. If the limit of ₹ 1.5 lakh under Section 80C for investment is used fully the tax would be zero for people with income of ₹ 4.5 lakh. While the taxation liability of people with income upto ₹ 5 lakhs is being reduced to half, all the other categories of tax payers in the subsequent slabs will also get a uniform benefit of ₹ 12500 .....

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Individual having taxable income upto ₹ 5 lakh other than business income. Also, a person of this category to file Income Tax Return for the first time would not be subjected to any scrutiny in the first year unless there is specific information available with the Department regarding his high value transactions. Shr Jaitley appealed to all citizens of India to contribute to Nation Building by making a small payment of 5% tax if their income is falling in the lowest slab of ₹ 2.5 la .....

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