Changes Expected in the Upcoming Union Budget 2017:
This Post On Expectation from Union Budget 2017 has been written by Nimisha Gupta, law student of University School of Law and Legal Studies, New Delhi
Union Budget 2017 budget will be unique for more than one reason. Firstly, it will be the first budget which will see the merger of both Union and financial budget. Secondly, this budget session is also set to depart from the age old colonial tradition of passing the budget on the last working day of February. In 2017 therefore, the budget would be presented on February 1. Thirdly, the year 2016 saw two path breaking economic decisions- Demonetisation and Goods & Services Tax. While the country is still recovering from the aftermath of high denomination note ban, many eyes are glued on the upcoming budget session seeking relief in tax norms for common man.
This is not all; the political drama has begun much before the budget session. The opposition came heavily on the Narendra Modi led government for presenting the budget before the upcoming elections in 5 states and thus alleged that the government will have a perfect opportunity to allure the people of these states by providing them incentives.
Here is a list of some of the major expectations from Union Budget 2017:
- Reduction in Income Taxes
It is believed by most of the economists and experts that the budget would make a sweeping recast of direct taxes. In respect of both the corporate tax and personal income tax, the government is likely to make changes in order to boost the struggling economy after demonetisation.
- Measures to Promote Cashless Transactions
Taking hint from government, the quantity of paper currency withdrawn from the market is not going to come back in circulation. Thus, government will try to promote digital economy and cashless transactions.
Some of the incentives for cashless transactions have already been announced by the government such as discounts when using cards, waiver of merchant discount rates etc.
- Increased Investment in Railways
As this will be the first budget which will see the merger of the Rail Budget with the Union Budget, there is all the more reason for the Finance Minister to introduce railway development measures. The modernization of railways is long overdue and the railway accidents in recent past are further expected to give impetus to government spending on railways modernization.
The budget is also expected to announce reduction in the interest rate on home loan. In its first budget, the Modi government had made provisions for cheap housing. Since the announcement was made in the midst of financial slump, the builders did not show much interest in it.
- Measures to boost Agriculture
Much has been said in media about how the farmers were unable to sow crops due to the ill- effects of demonetisation. If these reports have substance, food inflation is definitely going to cause a major problem in the coming months for the Modi Government. Keeping this in mind, it is expected that farmers might get some additional benefits as well as greater access to cashless transaction modes so that they can purchase seeds, fertilizers etc.
- No Tax Payments on Pension Income
Another populist announcement, which many are demanding from some time now, is the pension income for senior citizens to be made completely tax free. This will not only help the elderly but will also reduce operational work for income tax authorities (who are already overburdened in the wake of demonetisation).
- Cheaper two wheelers and small cars
The auto industry has been the worst affected in the aftermath of demonetisation. In November, the month in which the note ban was announced, the sale of two wheelers, small cars and commercial vehicles fell by 10 per cent. The government could announce cutting the cost of these vehicles to offset the impact of demonetisation.
There are humongous hopes and expectations attached with Union Budget 2017. It is just a matter of time now to see how the Modi Government fulfils on its election mandate of ‘acche din’.
Legal Parley had a sectoral analysis of the Union Budget, 2016. The same can be accessed HERE.
Picture Courtesy: Flickr
There Are 2 Comments