The Finance Minister further said that the government with Niti Aayog will also devise mechanism to ensure that the farmers get the minimum support price. He said that the country has grown on an average of 7.5 per cent in the first three years of the current government and has become a USD 2.5 trillion economy. "We hope to grow at 7.2 to 7.5 per cent in the second half of the current fiscal," he said. Jaitley further said that India has already become 7th largest economy of the world and it is expected to become 5th largest economy soon.
REACTIONS FOLLOWING JAITLEY'S BUDGET
06:41 PM: Niti Aayog CEO Amitabh Kant said that pilot projects on electronic health records, land records and digital certification to push the Budget announcment by FM Arun Jaitley.
Taking FMs Budget announcement forward NITI will run pilots on Electronic health records,land records & digital certification. Wherever people need to establish a trusted, shared, unique record blockchain technology can help by simplifying processes and removing intermediaries.- Amitabh Kant (@amitabhk87) February 1, 2018
06:27 PM: Lauding the new health insurance scheme floated in the Union Budget 2018, Congress leader Shashi Tharoor also pointed out the shortcomings in the ambitious project, enquiring cheekily 'will it prove another jumla?'
One good thing in #Budget2018 is the health insurance scheme to cover 500 million Indians. But the budget figures show no serious allocation for it, &the Fasal Bima Yojana has already proved a boon for insurance companies more than the insured. Will it prove another #jumla?- Shashi Tharoor (@ShashiTharoor) February 1, 2018
06:22 PM: Fraud of MSP only for Kharif i.e. Elections: Cost of production used by govt does not include costs of family labour & land rent, which is the global norm. We reiterate our demand for bringing a law giving farmers the Right to Sell at MSP, says CPI (M) leader Sitaram Yechury.
Fraud of MSP only for Kharif i.e. Elections:- Sitaram Yechury (@SitaramYechury) February 1, 2018
Cost of production used by govt does not include costs of family labour & land rent, which is the global norm. We reiterate our demand for bringing a law giving farmers the Right to Sell at MSP.
06:16 PM: The Budget proposals should have been bold and radical, and backed by adequate provision of funds. Unfortunately, the Budget proposals are a big let down, said Congress leader and former Finance Minister P Chidambaram.
ARUN JAITLEY'S BUDGET PRESSER
04:42 PM: Shortfall in GST revenue collection is Rs 50,000 crore in current fiscal: Finance Secretary Hasmukh Adhia
04:40 PM: Agriculture and rural economy have been given high priority in New India Budget: Arun Jaitley
04:38 PM: Niti Aayog will devise a mechanism to increase the Minimum Support Price for crops to 1.5 times of production cost, as promised in New India Budget; to be done in consultation with the states: Arun Jaitley
04:35 PM: Step by step, in every budget, I have been putting surplus money in the hands of the middle-class taxpayer: Arun Jaitley
04:30 PM: Contribution of the salaried class has been reognized for the first time: Arun Jaitley
UNION BUDGET 2018-19: KEY TAKEWAYS
- MSP for all unannounced kharif crops will be one and half times of their production cost like majority of rabi crops: Institutional Farm Credit raised to 11 lakh crore in 2018-19 from 8.5 lakh crore in 2014-15.
- 22,000 rural haats to be developed and upgraded into Gramin Agricultural Markets to protect the interests of 86 per cent small and marginal farmers.
- "Operation Greens" launched to address price fluctuations in potato, tomato and onion for benefit of farmers and consumers.
- Two New Funds of Rs10,000 crore announced for Fisheries and Animal Husbandary sectors; Re -structured National Bamboo Mission gets Rs 1290 crore.
- Loans to Women Self Help Groups wil l increase to Rs 75,000 crore in 2019 from 42,500 crore last year.
- Outlay on health, education and soci al protection will be 1.38 lakh crore. Tribal students to get Ekalavya Residential School in each tribal block by 2022. Welfare fund for SCs gets a boost.
- Rs 5.97 lakh crore allocation for infrastructure.
- NITI Aayog to initiate a national programme on Artificial Intelligence. Centres of excellence to be set up on robotics, AI, Internet of things etc.
- To control cash economy, payments exceeding Rs 10,000 in cash made by trusts and institutions to be disallowed and would be subject to tax.
- Tax on Long Term Capital Gains exceeding Rs 1 lakh at the rate of 10 percent, without allowing any indexation benefit. However, all gains up to 31st January, 2018 will be grandfathered.
- Proposal to introduce tax on distributed income by equity oriented mutual funds at the rate of 10 per cent.
- Proposal to increase cess on personal income tax and corporation tax to 4 percent from present 3 per cent.
- Proposal to roll out E-assessment across the country to almost eliminate person to person contact leading to greater efficiency and transparency in direct tax collection.
- Proposed changes in customs duty to promote creation of more jobs in the country and also to incentivise domestic value addition and Make in India in sectors such as food processing, electronics, auto components, footwear and furniture.
Relief to Senior Citizens proposed:
- Exemption of interest income on deposits with banks and post offices to be increased from Rs 10,000 to Rs 50,000.
- TDS not required to be deducted under section 194A. Benefit also available for interest from all fixed deposit schemes and recurring deposit schemes.
- Hike in deduction limit for health insurance premium and/ or medical expenditure from Rs. 30,000 to Rs. 50,000 under section 80D.
- Increase in deduction limit for medical expenditure for certain critical illness from Rs 60,000 (in case of senior citizens) and from Rs 80,000 (in case of very senior citizens) to Rs 1 lakh for all senior citizens, under section 80DDB.
- Proposed to extend Pradhan Mantri Vaya Vandana Yojana up to March, 2020. Current investment limit proposed to be increased to Rs 15 lakh from the existing limit of Rs 7.5 lakh per senior citizen.
Prime Minister Narendra Modi on Union Budget 2018-19
01:40 PM: Ayushman Bharat will help 10 crore families in their medical need. This is the biggest ever government-sponsored health care programme in the world: PM Modi
01:36 PM: I congratulate the Finance Minister for the decision regarding MSP. I am sure it will help farmers tremendously: PM Narendra Modi
01:34 PM: The farmers, Dalits, tribal communities will gain from this Budget. The Budget will bring new opportunities for rural India: PM Narendra Modi
01:32 PM: This Budget is farmer friendly, common citizen friendly, business environment friendly and development friendly. It will add to 'Ease of Living': Narendra Modi
01:30 PM: This budget has devoted attention to all sectors, ranging from agriculture to infrastructure: PM Narendra Modi
What Will Get Expensive
- Customs duty on sunglasses, cigarette lighter, toys, bus and truck tyres, select furniture hiked.
- Customs duty on crude edible vegetable oils like groundnut oil, safflower seed oil hiked from 12.5 per cent to 30 per cent; on refined edible vegetable oil from 20 per cent to 35 per cent.
- Customs duty on imitation jewellery hiked from 15 per cent to 20 per cent; doubled on all watches to 20 per cent.
- Import duty on LCD/LED/OLED panels, parts of TVs hiked to 15 per cent; duty on smart watches, wearable devices, footwear doubled to 20 per cent.
- Import duty on fruit juice raised from 30 per cent to 50 per cent.
- Customs duty on perfumes, dental hygiene, after-shave, deodorants, room deodorizers, preparations for use on hair doubled to 20 per cent.
UNION BUDGET 2018-19: REACTIONS ON ARUN JAITLEY'S ANNUAL BUDGET SPEECH
"Not a single extra rupee increased in Delhi's share in Central taxes since 2001-02, stays at Rs 325 crore. No other part of India gets such treatment. BJP government at Center continues to treat Delhi residents as second-grade citizens: Delhi Deputy Chief Minister Manish Sisodia
"Where is the direction? Where will the investment come from? The ambitious health cover programme will go like crop insurance scheme where only insurance companies make money. It's not a budget for common people: Congress spokesperson Pawan Khera
LIVE UPDATES12:45 PM:The government to increase customs duty on mobile phones from 15 per cent to 20 per cent: Arun jaitley
12:40 PM: Existing 3 per cent cess on health and education to be increased to 4 per cent: Arun jaitley
12:35 PM: Companies with turnover of upto Rs 250 crore to be taxed at 25 per cent: Arun Jaitley
12:30 PM:100 per cent tax rebate for farmer producer companies having a turnover of Rs 100 crore: Arun Jaitley
12:25 PM: No change in personal income tax rates for salaried class: Arun Jaitley
12:20 PM:The government estimates fiscal deficit for FY 2018-19 at 3.3 per cent: Arun Jaitley
- PIB India (@PIB_India) February 1, 201812:15 PM: The emoluments for the President, Vice-President and Governors were last revised in 2006. Therefore, I propose to revise the emoluments for President to Rs 5 Lakh, for Vice-President Rs 4 lakh and for Governors Rs 3.5 Lakh: Arun Jaitley
12:10 PM: The government insurance companies will be merged into a single entity, and subsequently listed in the stock exchange, as part of the disinvestment programme: Arun Jaitley
12:05 PM: The government to take all steps to eliminate use of cryptocurrencies which are being used to fund illegitimate transactions. The government will also explore the use of block-chain technology for ushering in digital economy: Arun Jaitley
11:55 AM: The government will contribute 12 per cent of wages of new employees in EPF for all sectors for the next 3 years : Arun Jaitley
11:50 AM: The government to launch 'Revitalising of Infrastructure and Systems in Education' by 2022 with a total investment of Rs 1 lakh crore in next 4 years: Arun Jaitley
11:45 AM: World's largest govt-funded health programme - 'National Health Protection Scheme' to cover 10 crore poor and vulnerable families by providing upto Rs 5 lakh per family per year: Arun Jaitley
World's largest govt-funded health programme - 'National Health Protection Scheme' to cover 10 crore poor and vulnerable families by providing upto Rs 5 lakh per family per year: FM @arunjaitley#Budget2018#NewIndiaBudget#BudgetWithDDNewspic.twitter.com/pNdC0i2fRg- Doordarshan News (@DDNewsLive) February 1, 2018
11:42 AM: One goverment medical college to be ensured for every 3 parliamentary constituencies by upgrading 24 district-level colleges: Arun Jaitley
11:40 AM: The Government is slowly but steadily progressing towards universal health coverage: Arun Jaitley
11:38 AM: Providing 5 lakh rupees per family per year for medical reimbursement, under National Health Protection Scheme. This will be world's largest health protection scheme: Arun Jaitley
11:35 AM: By 2022, every block with more than 50 per cent ST population and at least 20,000 tribal people will have 'Ekalavya' school at par with Navodaya Vidyalas: Arun Jaitley
11:32 AM: The government plans to construct 2 crore more toilets under Swachh Bharat Mission: Finance Minister Jaitley
11:30 AM: The government uner Pradhan Mantri Ujjwala Yojana will provide 8 crore free gas connections to women: Arun Jaitley
11:25 AM: New scheme to subsidize machinery required for crop residue to tackle air pollution: Finance Minister
11:20 AM: 5 Lakh per annum health cover for 50 crore Indians: Arun jaitley
11:15 AM: Bamboo is green gold, we have removed the classification of bamboo grown outside the forest areas as trees: Arun Jaitley
11:10 AM: The government should ensure that farmers get minimum support price (MSP) for their production and we in consultation with Niti Aayog will devise a plan to ensure that: Arun Jaitley
11:05 AM:This year's Budget will focus on strengthening agriculture and rural economy. We are committed to double the farmers income by 2022: Arun Jaitley
11:00 AM: Finance Minister Arun Jaitley begins his Budget 2018-19 speech by highlighting the government's economic reforms and its achievements.
10:30 AM: Finance Minister Arun Jaitley meets Prime Minister Narendra Modi in Parliament.
9:55 AM:Finance Minister Arun Jaitley arrives in Parliament for Budget presentation. He will begin his Budget speech at 11 AM.
9:44 AM: Union Budget 2018-19 papers arrive in the Parliament.
9:40 AM:Finance Minister Arun Jaitley meets President Ram Nath Kovind ahead of his Budget 2018-19 presentation in the Parliament at 11 AM.
Delhi: Finance Minister Arun Jaitley met President Ram Nath Kovind at Rashtrapati Bhavan before presenting the Union Budget 2018-19 in the Parliament. pic.twitter.com/7aaRpXhVPy- ANI (@ANI) February 1, 2018
9:18 AM:Ahead of Arun Jaitley's Budget 2018-19 presentation, Sensex opens 157 points higher to 36121, Nifty up 41 points to 11,067 level.
9:15 AM: If Dalal Street reports are to be true, Arun Jaitley may impose LTCG tax on equities which will make the investment class less attractive to FIIs, DIIs and retail investors.
9:10 AM: Arun Jaitley's Day Plan: Finance Minister Jaitley will begin his Budget speech in Parliament at 11 AM. He will hold post Budget press conference in evening at 4 PM. The Finance Minister will also hold discussion with Economic Advisory Council at 4:30 PM.
8:59 AM: As per ritual, Finance Minister Jaitley poses with Budget briefcase and heads to Rashtrapati Bahavan to meet President Ram Nath Kovind.
8:44 AM: Finance Minister Arun Jaitley reaches North Block office and he will deliver his Budget speech in Hindi.
7:50 AM: It will be a good budget. It will be for the benefit of the common people: Shiv Pratap Shukla, MoS, Finance
7:45 AM: People expect Finance Minister Arun Jaitley to deliver on Prime Minister Modi's promise of doubling the farmers' income.
HERE ARE SOME EXPECTATIONS
Small businesses, which have traditionally formed the core support base of the BJP, too may get some sops to ease pain caused to them due to the chaotic rollout of the Goods and Services Tax (GST) and demonetisation.
Arun Jaitley is also expected to enhance allocations on infrastructure projects like highways and railways to boost economic growth and generate more jobs.
Chief Economic Adviser Arvind Subramanian has indicated that the government may be willing to ease off on the strict fiscal deficit target which would provide more headroom for the finance minister. Jaitley had previously set a target to lower the fiscal deficit to 3.2 per cent of GDP in the current fiscal and to 3 per cent in 2018-19 budget to be presented on Tuesday.
This will also be the first budget to be presented after the introduction of the new GST regime. As a result the finance minister will have less leverage in changing tax rates since central excise duty on goods and service tax have both been subsumed in the GST and he no longer has the sole power infrato fix rates on them. Another constraint for the finance minister is the increase in international oil prices to around $70 per barrel. The country imports close to 80% of its crude requirement and while high oil prices fuel inflation it also increases the country's trade and current account deficits.
Some kind of incentives to boost exports of certain sectors may be announced while there may be announcements for start-ups.
The finance minister may also impose a capital gains tax on investments in stocks so that other forms of investments such as fixed deposits in banks turn more attractive.
While India Inc. is hoping the finance minister will finally show some movement on his 2015 promise to lower corporate tax rate to 25 per cent from 30 per cent over four years this may not happen given the pro-poor tilt in a pre-poll budget. Scrapping the colonial-era tradition of presenting the Budget at the end of February, Jaitley had for the first time presented it on February 1 last year.
The presentation of the budget was advanced by a month to ensure that proposals take effect from April 1, the beginning of the new financial year. Besides, the nearly century old tradition of having a separate budget for the railways has been dropped. The railway budget now forms a part of the general budget.
This will be the last full-fledged budget by the present Modi government as a vote-on-account or approval for essential government spending for a limited period is taken in the election year and the full budget is presented after the new government is sworn in.