Union Budget of India: Information & 2016 - 17 Highlights YouTube Lecture Handouts
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Union Budget of India: Information & 2016 - 17 Highlights
Union Budget of India
Highlights 2016 - 17
Key Aspects
- Annual Financial Statement – Article 112
- 1st Budget by RK Shanukham Chetty in 1947
- Morarji Desai – Maximum Budget (10)
- Only women Finance Minister – Indira Gandhi
- Printing of Budget – 1 Week Before – Complete Isolation – North Block
- 1973 - 74: Black Budget – Deficit ₹ 550 Crore
- 1997 - 98: Dream Budget – Economic Reforms
- Starting 2017: Presented on 1st Feb
- Merger of Union & Rail Budget
- Removal of plan & non-plan expenditure for holistic allocations
Kautilya՚s Arthashastra
- Estimate the Revenue
- Revenue = Receipts for Current year + Delayed Payment due in Earlier Years – (Expenditure + Exemptions + Postponement of Payments)
- Norman Period ⇾ Treasury + Exchequer
- Budget from “Bougette” French Word for Leather Bag
India – Budget by Finance Minister
- Estimates of expenditures (Plan & Non-Plan) and revenues (Capital & Current)
- First estimate of deficit (Shortfall in revenue)
- Narrowing of deficit
- Presentation and approval of budget
Plan & Non – Plan Expenditure
Plan Expense
- Major Proportion
- Grants to Various Ministers
Non Plan Expense
- Interest payments
- Subsidies
- Wage and salary payments
- Grants to States and UTs
- Pensions, police, economic services
- Tax collection, social services
- Grants to foreign governments
- Defense
Capital & Current Receipts
Capital receipts
- Repayment of loans given by the government
- Receipts from divestment of public-sector equity and borrowings — both domestic and external
Current receipts
- Tax revenues
- Receipts by way of dividends from public-sector units
- Interest payments on loans given out by the central government
Important Articles
- Article 114: Government can withdraw money from Consolidated Fund of India only on approval from Parliament & get the Appropriation Bills approved by Parliament. This authorizes the executive to spend money.
- Article 265: Prohibits the government from collecting any taxes without the authority of law. Finance Bill is released & it may levy new taxes, modify or continue the existing tax structure beyond the period approved by Parliament earlier.
Important Documents
- Macro-Economic Framework Statement: Enjoined by the Fiscal Responsibility and Budget Management Act, 2003 (FRBM Act) , contains an assessment of the growth prospects of the economy with specific underlying assumptions.
- Medium Term Fiscal Policy Statement: Enjoined by the FRBM Act sets forth a three year rolling target for specific fiscal indicators along with underlying assumptions …
- Fiscal Policy Strategy Statement: Enjoined by the FRBM Act, contains the policies of the Central Government for the ensuing financial year relating to taxation, expenditure, lending and investments, administered pricing, borrowings and guarantees.
2016 - 17 Highlights
- Current Account Deficit declined from 1% last year to 0.3% of GDP in the first half of 2016 - 17
- FDI ↑ by 36%
- Foreign Exchange Reserves at 361 Billion US $
- War against black money
- Fiscal Consolidation
- Uncertainty for crude oil
- Retreat from globalization – Focus on protectionism
- Constitutional Amendment Bill for GST
- Demonetization of high currency notes
- Enactment of the Insolvency and Bankruptcy Code
- Enactment of the Aadhar bill for subsidies & benefits
- Farmers: Double the income in 5 years
- Rural Population: Employment & basic infrastructure
- Youth: Education, skills and jobs
- Poor and the Underprivileged: Social security, health care and affordable housing
- Infrastructure: Efficiency, productivity and quality of life
- Financial Sector: Growth & stability by stronger institutions
- Digital Economy: Speed, accountability and transparency
- Public Service: Effective governance and efficient service delivery through people՚s participation
- Prudent Fiscal Management: Deployment of resources and preserve fiscal stability
- Tax Administration: Honoring the honest
- Demonetization: Liquidity in banking system will ↓ borrowing costs & ↑ access to credit
- Integrate Agri. Credit Society with Core Banking
- 1 crore households out of poverty by 2019
- Make 50,000 Gram Panchayats poverty free by 2019
- 100% village electrification by 2018
- National Rural Drinking Water Program (NRDWP) : Safe drinking water to over 28,000 arsenic and fluoride affected areas in next 4 year
- Annual learning outcome in schools
- SWAYAM platform – 350 online courses
- National Testing Agency: Autonomous and self-sustained premier testing organization to conduct all entrance examinations for higher education institutions
- Skill Acquisition and Knowledge Awareness for Livelihood Promotion program (SANKALP) to be launched
- Eliminate Kala-Azar and Filariasis by 2017, Leprosy by 2018, Measles by 2020 and Tuberculosis by 2025
- Reduce IMR from 39 in 2014 to 28 by 2019 and MMR from 167 in 2011 - 13 to 100 by 2018 - 2020
- 2 new AIIMS – Jharkhand & Gujarat
- Amend drugs & cosmetic rules
- Aadhar based smart cards for senior citizens
- For passenger safety, Rashtriya Rail Sanraksha Kosh: ₹ 1 lakh crores over 5 years
- Unmanned level crossings on Broad Gauge lines will be eliminated by 2020
- ‘Coach Mitra’ , a single window interface, to register all coach related complaints
- 500 stations with lift & escalator
- All coaches with bio-toilets – by 2019
- New Metro Rail Policy – Innovative & indigenous
- By 2017 - 18: high speed broadband connectivity on optical fibre will be available in more than 1,50, 000 gram panchayats, under BharatNet
- DigiGaon initiative: Tele-medicine, education and skills through digital technology
- Establish strategic oil reserves at Chandikhole in Odisha and Bikaner in Rajasthan
- Trade Infrastructure for Export Scheme (TIES) will be launched in 2017 - 18
- Abolish Foreign Investment Promotion Board in 2017 - 18
- Establish Computer Emergency Response Team for our Financial Sector (CERT-Fin)
- Launch New ETF with diversified CPSE stocks and other Government holdings in 2017 - 18
- BHIM app - Referral Bonus Scheme for individuals & Cashback Scheme for merchants
- Aadhar Pay: Merchant version of Aadhar Enabled Payment System to be launched
- 10 lakh new POS terminals by March 2017
- Payments Regulatory Board in RBI by replacing existing Board for Regulation and Supervision of Payment and Settlement Systems
- Government e-market place: Functional for procurement of goods and services
- To utilize the Head Post Offices as front offices for rendering passport services
- Centralized Defense Travel System developed - travel tickets can be booked online by soldiers and officers
- Web based interactive Pension Disbursement System for Defense Pensioners to be established
- Demonetization: Deposits between 2 to 80 lakh Rupees 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 crores.
- Profit-linked income tax deduction for promotion of affordable housing: Carpet area instead of built up area of 30 and 60 Sq. Mtr. will be counted
- 30 limit: municipal limits of 4 metropolitan cities
- 60 : For the rest of India & peripheral areas of metros
- No transaction above ₹ 3 lakh would be permitted in cash subject to certain exceptions
- Miniaturized POS card reader for m-POS, micro ATM standards version 1.5.1, Finger Print Readers/Scanners and Iris Scanners manufacture to be exempt from BCD, Excise/CV duty and SAD
- Maximum amount of cash donation, a political party can receive: ₹ 2000/- from one person, can receive cheque & digital payments
- Threshold limit for audit of business entities who opt for presumptive income scheme ↑ from ₹ 1 crore to ₹ 2 crores.
- Threshold for maintenance of books for individuals and HUF ↑ from turnover of 10 lakhs to 25 lakhs or income from 1.2 lakhs to 2.5 lakhs
- Existing rate of taxation for individual assesses between income of ₹ 2.5 lakhs to 5 lakhs ↓ to 5% from 10%
- Surcharge of 10% of tax: Annual taxable income is between ₹ 50 lakhs and ₹ 1 crore
- Simple one-page form to be filed as Income Tax Return for the category of individuals with taxable income upto ₹ 5 lakhs other than business income
- Appeal 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 lakhs to 5 lakhs.
✍ Manishika