“Tax evasion will be countered strongly”, he warned.
Advertisement
Of course, like with every year, cars are even more expensive than before.
But what we were lacking were the specifics of revenue-raising – especially given the finance minister is not loosening its fiscal deficit target.
But in a major departure from the past, where government expenditure could be demarcated between productive and administrative expenses, the finance minister said the classigication of plan and non-plan will be done away with from 2017-18.
Calling the country one of the “bright spots in the world economy”, Jaitley also underlined that the economy remains strong. Most analysts believe the government will need to continue spending to push the economy forward over the next year. “They will also expand employment opportunities for the youth”, Jaitley said. “Indian growth is at an extraordinary high”. This was the 85th annual budget, and judging by the reaction of the market, one must certainly underline that it was a growth-oriented one.
The government will increase spending on the National Rural Employment Guarantee Scheme, which guarantees 100 days of employment on public works each year for any household that requests it. There would be an increase in limit of deduction in respect of rent paid from Rs. 24000 pa to Rs 60000 pa. Jaitley also said that service tax would be exempted for general insurance schemes under Niramayi Swasthya Bima Yojna.
“A unified agriculture platform will be dedicated to the nation on the birth anniversary of BR Ambedkar”, Jaitley announced.
Announcing allocation of a sum of Rs 38,500 crore for MGNREGA in 2016-17, he said, “formation of Self Help Groups (SHGs) will be speeded up to promote multiple livelihoods”.
As much as Rs 2.87 lakh crore will be given as grants in aid to panchayats and municipalities while allocation for social sector including education and healthcare has been pegged at Rs 1.51 lakh crore.
Advertisement
The news hit banking stocks in trading on the Mumbai stock exchange, although infrastructure firms rallied on Jaitley’s announcement that the government would allocate $32 billion for infrastructure development in 2016/17. In order to build the proposed 1500 multi-skill training institutes, the government has allotted Rs. 1700 crore for the year 2016-17. “It is a tough time and this wasn’t what the auto industry was expecting”, says Puneet Gupta, associate director, IHS Automotive Forecasting. Commitment to no retrospective taxation and measures pertaining to FDI, voluntary disclosure of black money, national rural digital literacy mission were among the other positives.
