#Budget2017: Political Funding Reform Starts, Income Tax Halved, Rural Allocation Up 24%
A farmer carries a water pump to irrigate his vegetable field in Kolkata. Finance Minister Arun Jaitley presented his fourth budget today, with increased allocation for Mahatma Gandhi National Rural Employment Guarantee Act and an increased target for agriculture credit.
Finance Minister Arun Jaitley presented a budget that appeared to be a salve for the tribulations of demonetisation: He hiked outlays for the world's largest employment generation scheme, increased the target for agriculture credit in an attempt to reduce poverty in rural India and offered tax benefits to small and medium enterprises and salaried Indians.
Jaitley also began the process of reforms in political party funding--something Prime Minister Narendra Modi alluded to in his December 31, 2016 speech. Under the proposed reform, anonymous cash donations to political parties have been capped at Rs 2,000, down 90% from the existing Rs 20,000.
"The budget is a step for strengthening the economy, improving farmers income and bettering the quality of life of citizens," Modi said immediately after the Budget speech
The government reduced the personal income tax rate for the slab of Rs 2.5-5 lakh from 10% to 5%, with an additional rebate of Rs 2,500 for those with income below Rs 350,000. The FM has also announced a benefit of Rs 12,500 for individual taxpayers who earn more than Rs 5 lakh per annum.
In effect, an individual with income of Rs 300,000 will not have to pay any income tax, and an individual with an income of Rs 450,000, who declares deductions under existing income tax laws--such as savings, rent, asset repayment, etc--of Rs 150,000 will also not have to pay any income tax.
Corporate tax rate for small companies with turnover less than Rs 50 crore has been reduced from 30% to 25%. About 96% of India’s companies will benefit from this step, the finance minister said.
A consecutive rural focussed budget
The allocation for rural, agriculture and allied sectors in 2017-18 is Rs 1,87,223 crore--24% higher than the previous year, Jaitley said.
Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), which assures 100 days of employment for job seekers per year, has seen an increased outlay of Rs 48,000 crore--the highest ever--in 2017-18 from Rs 38,500 crore allocated in 2016-17, up 25%. If we take into account Rs 9,000 crore added as supplementary grants towards MGNREGA during 2016-17, the rise in funding is just 1%.
The Antyodaya Yojana has been set a target of getting 10 million rural households out of poverty and making 50,000 gram panchayats poverty-free by 2019.
Agricultural credit target has been increased to Rs 10 lakh crore for the next financial year, in a move to meet the government’s commitment of doubling farmers income in five years.
The FM also spoke about the benefits of demonetisation, and added that impact on the economy would be transient, and the gross domestic product (GDP) would be bigger, cleaner and real in the coming years.
Jaitley also listed out some details about bank deposits post-demonetisation: Over 10 million accounts saw deposits between Rs 200,000 and Rs 80 lakh (with an average deposit of Rs 503,000) and about 148,000 accounts saw deposits above Rs 80 lakh with average deposit of Rs 3.3 crore.
Presenting the first combined budget (including Railways Budget) since 1924, the Finance Minister has allocated Rs 55,000 crore from the budget for capital expenditure on railways, of a projected expenditure of Rs 1.31 lakh crore.
While the total expenditure for 2017-18 has been budgeted at Rs 21,47,0000 crore, capital expenditure would be increased by 25%, Jaitley said. The Centre will transfer Rs 4.1 lakh crore to states and union territories.
The government is also expected to borrow less at Rs 3.48 lakh crore as against Rs 4.25 lakh crore last year.
Our tweets, storified:
https://twitter.com/FactCheckIndia/status/826664232326483970 https://twitter.com/IndiaSpend/status/826667037795708929 https://twitter.com/IndiaSpend/status/826667927260782592 https://twitter.com/IndiaSpend/status/826668253569130496 https://twitter.com/IndiaSpend/status/826668566879428608 https://twitter.com/IndiaSpend/status/826669012818022400 https://twitter.com/IndiaSpend/status/826669513747816449GDP growth in 2017-18 is projected at 6.75-7.5% post-demonetisation: #EconomicSurvey https://t.co/vtCUyi0Kbg pic.twitter.com/Dnu5SbdOKp
— Fact Check India (@FactCheckIndia) February 1, 2017
— IndiaSpend (@IndiaSpend) February 1, 2017
— IndiaSpend (@IndiaSpend) February 1, 2017
.@arunjaitley on rural spending. #Budget2017 pic.twitter.com/7m54vl6Lm1
— IndiaSpend (@IndiaSpend) February 1, 2017
#Budget2017 promises modernising #education pic.twitter.com/6GZlQ32vSU
— IndiaSpend (@IndiaSpend) February 1, 2017
2016 @asercentre report found 46.1% of grade I rural children couldn’t read letters;39.9% couldn’t recognise nos 1-9 https://t.co/PY9lHDBbkR pic.twitter.com/2PmBYiQgNr
— IndiaSpend (@IndiaSpend) February 1, 2017
#Budget2017 pic.twitter.com/KmerYMknAe
— IndiaSpend (@IndiaSpend) February 1, 2017
In 2014, 480,000 estimated to have died of #tuberculosis in India; 2.8 million new TB cases in 2015. Our story: https://t.co/Uabmxt6wvm pic.twitter.com/MGXk9uKSS8
— IndiaSpend (@IndiaSpend) February 1, 2017
#Railways in #Budget2017 pic.twitter.com/GGiycNRQq7
— IndiaSpend (@IndiaSpend) February 1, 2017
#Railways in #Budget2017 pic.twitter.com/BCPJJiRUFu
— IndiaSpend (@IndiaSpend) February 1, 2017
Government changes Kala Azar elimination target for the third time to 2017. First target-2010, second target-2015 #Budget2017 @arunjaitley pic.twitter.com/RRRHtFyUJL
— IndiaSpend (@IndiaSpend) February 1, 2017
2943 #KalaAzar cases in 2016 down by 78% from 2013. http://164.100.47.190/loksabhaquestions/annex/9/AS183.pdf #Budget2017 pic.twitter.com/tPG8FU2ChO
— IndiaSpend (@IndiaSpend) February 1, 2017
1,25,785 new #leprosy cases in 2014-15, new case detection rate 9.73 per 100,000. NLEP Progress Report: 2014-15: https://t.co/jf0fcRNoX4 pic.twitter.com/DPQAk375VK
— IndiaSpend (@IndiaSpend) February 1, 2017
26% of habitations electrified have 100% electrification https://t.co/gu8A2dPQ18 @arunjaitley @MinOfPower #Budget2017 pic.twitter.com/MViSXlgSUt
— IndiaSpend (@IndiaSpend) February 1, 2017
Until Mar 2016, there were 12.6 internet subscribers per 100 people in rural India; 58.28 in urban areas. Our story https://t.co/x6YbXHhkpe pic.twitter.com/vJPJVs2bFi
— IndiaSpend (@IndiaSpend) February 1, 2017
— Fact Check India (@FactCheckIndia) February 1, 2017
#Budget2017:1.5 lakh health sub-centres to be transformed to Health Wellness Centres, only 5% increase in no. of sub-centres bet 2005 & 2015 pic.twitter.com/Peonq3Xpvv
— IndiaSpend (@IndiaSpend) February 1, 2017
Where the money for India's #Budget2017 will come from: pic.twitter.com/HpGaAF8NEI
— IndiaSpend (@IndiaSpend) February 1, 2017
#Budget2017: Expenditure: 21.47 lakh crore; 18% on interest payments, 10% on subsidies, 9% on defence pic.twitter.com/ZPk0eX7CpQ
— IndiaSpend (@IndiaSpend) February 1, 2017
MGNREGA allocation highest in 2017-2018, but only 1.05% more than revised 2016-2017 budget estimates. pic.twitter.com/gLLdjnfwLj
— Fact Check India (@FactCheckIndia) February 1, 2017
Edn budget 10% > 2016-17;15.5% increase in higher ed,school ed budget 6.4%. Our analysis suggested focus on schools: https://t.co/f6VQvvHImu pic.twitter.com/5GHBj159Ni
— IndiaSpend (@IndiaSpend) February 1, 2017
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