Economy

Major Highlights of Budget 2018 for all sections

Major Highlights of Budget 2018 for all sections”

The second half of past year saw a radical reworking of the items within the four-slab GST structure by the supremely federal institution of the GST Council, whereby all but 50 of over 1,200 items remained in the highest 28 per cent bracket.

Chandrajit Banerjee, director general of the Confederation of Indian Industry (CII), said: "Many of the measures in the budget are in line with the CII's recommendations such as incentives for new jobs, extending fixed term employment, enhancing quality of education including teacher training and addressing healthcare access".

The government has opted for wider fiscal deficit at 3.5 percent of GDP for 2018-19 and projected 2018-19 deficit at 3.3 percent of GDP. Though, of course, the prospect of reducing it to 2.5% in the next 5 years is achievable.

Even if it were keen on delivering these promises, which is unlikely in the next year, the government will have to overcome a cash crunch.

Modi's government on Thursday also raised the federal health budget by 11.5 percent for 2018-19. He noted that 86% of India's farmers were small or marginal, and the government would spend a total 14.34 trillion rupees on rural livelihoods and infrastructure in 2018-19. Education initiative would also include the establishment of quite a few schools of architecture and institutions of eminence over the next few years. And two, the National Health Protection Scheme - with an aim of reaching to about 10 crore poor and vulnerable families, the government plans to reach out to approximately 50 crore beneficiaries, providing up to Rs 5 lakh health insurance cover per family per year.

He announced no changes for personal income tax rates. This cess will replace the existing Education Cess. However, in an interview with Doordarshan, the national broadcaster, Jaitley defended the proposals saying, "Agriculture was one of the weakest sectors in the economy and it needed support". The biggest challenge, however, would be to honour the commitment of MSP by the government.

Jaitley reasserted the government's resolve to double farmers' income, increase production from same land parcels. Back-of-the-envelope calculations show that while there will be an overall increase of approximately Rs 5,300 crore, the allocation for the capital acquisition sub-segment will go up by just about Rs 4,500 crore to approximately Rs 73,500 crore, bulk of which will go into meeting the committed liabilities on account of the ongoing contracts.

The differential corporate tax for the companies up to turnover of Rs 250 crore would help the SMEs and revive their confidence, Mr Sehgal added.

He also proposed to set up state-of-the-art facility in 42 mega food parks. He said, "An extra Rs 10,000 crore is provided to bring 50 million people through five lakh wifi hotspots in rural areas to this side of the digital divide".

In the first year, the burden on the Centre is likely to be around Rs 3,000 crore.

"We were expecting further reduction in corporate tax for the MSME sector in this budget", he added. In fact, by increasing the customs duty on mobile imported from overseas, it will become more expensive than ever before and it will benefit domestic companies such as Intex, Micromax, Carbon and Lava. The latest hike follows in the footsteps of a recent import duty revision from 10% to 15%. Various guesstimates by various officials have pegged the quantum of funds required to implement the scheme at a ridiculously low number. This will help address the air pollution problem in the northern states which arises due to post-harvest on-farm burning of rice plant stubs.



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