Indian Budget: Marginal tax relief, cars to go costlier

The renewable energy industry is upbeat after Finance Minister Arun Jaitley presented the Budget today.

He said that government will reorient its intervention in the farm and non-farm sectors to shift focus beyond the country’s food security to farmers’ income security.

Presenting his third budget in parliament, Jaitley proposed 100 per cent tax deduction on profits from housing projects with flats measuring 30 sq metres in metros and 60 sq metres in other cities.

India pledged to spend $5.2 billion dollars to double the income of struggling farmers and also boost a rural employment scheme as it unveiled its annual budget on Monday under pressure to balance much-needed spending with fiscal prudence.

Jaitly said that 5,542 villages have been electrified till now, more than the last three years combined and promised for 100 per cent village electrification by 2018.

It also plans to increase spending on a crop insurance program and a rural employment scheme.

As mentioned by the Prime Minister, Narendra Modi while launching Startup India campaign, FM also revealed that the government is working on a system which will enable the companies to get themselves registered in one day through a mobile app. If the government manages to pull this one off, it will be great boost for the startup sector.

The Indian economy is doing well despite slowing growth in other emerging and leading economies, Jaitley said.

Mr Advani said that at a time when the global economy remains weak, India’s growth is laudable.

Still some companies said more attention should have been given to the manufacturing sector even as the rival Congress party called it a “wasted opportunity”.

“What is the one big takeaway for the average citizen?” The main focus is to bringing about qualitative change in the country”, Modi said, adding “there will be a big change in the lives of common people.

The main Sensex index on the Bombay Stock Exchange fell 300 points during Jaitley’s presentation of the budget, which included a hefty 23 percent pay rise for millions of civil servants and a pension scheme for retired soldiers.

He said India will sustain growth of around 7.6 percent this year, despite global headwinds, and he committed to fiscally prudent policies saying he will stick to the fiscal deficit target of 3.5 percent.

As cars turn more expensive, OEMs will take a hit in FY2016-17With the new taxes, which come into effect from April 1, 2016, virtually all passenger cars will turn more expensive, from the Tata Nano priced at Rs 240,000 (on-road, New Delhi) through to the Rolls-Royce Phantom which costs a whopping Rs 7.50 crore (on-road New Delhi).

The minister allocated INR 2.21 trillion for infrastructure development for 2016-17.

The minister maintained the recapitalization limit for public sector banks at INR 250 billion.

This month the Jats, traditionally a farming caste, sparked riots in northern India to press their demands for better access to government jobs and education.