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Budget 2017 | FM Speak: ‘Step Towards Transformation’

Finance Minister Arun Jaitley spoke about political funding, tax slab reduction, motive behind the Budget, etc., at a press conference post the Budget

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On Motive Behind Budget
We needed to maintain the direction of our programmes and further strengthen those programmes that are doing well. The Budget follows the theme of ‘Transform, Energise and Clean India’. Providing tax relief to the MSMEs and SMEs with an annual turnover of Rs 50 crore, would enable them to invest in job creation and increase capital expenditure.

On Priority Sectors
More money has been allocated to agriculture, Pradhan Mantri Gram Sadak Yojna (PMGSY), Pradhan Mantri Aawas Yojna (PMAY), Swach Bharat and a big push to the rural sector. We have made the highest ever allocation to MGNREGA scheme at Rs 48,000 crore while Rs 19,000 crore has been allocated for PMGSY. The PMAY gets Rs 23,000 crore, around 53 per cent more than last year, and comes with the target of constructing 1 crore homes by 2019 for homeless and those living in kuccha houses. Promotion of digital economy is an integral part of the strategy. The government will soon launch an Aadhaar-based payment system to promote digital transactions for people living in hinterlands.

On Reduction of Tax Slab
While the government is trying to bring more people within the tax-net who are evading taxes, the present burden of taxation is mainly on honest tax payers and salaried employees who are showing their income correctly. Therefore, post-demonetisation, there is a legitimate expectation of this class of people to reduce their burden of taxation. I, therefore, propose to reduce the existing rate of taxation for individual assessees between incomes of Rs 2.5 lakh and Rs 5 lakh to 5 per cent from the present rate of 10 per cent.

On Political Funding Curbs

An amendment is being proposed to the Reserve Bank of India Act to enable the issuance of electoral bonds. Under this scheme, a donor can purchase bonds from authorised banks and redeem them in the registered accounts of a political party. These bonds will be redeemable within the prescribed time limit from issuance of bond. And we will ensure that the window for redeeming these bonds are as small as possible. These bonds will be bought through cheques and bonds will be encashed with banks.

On Scrapping of FIPB
With relaxed FDI norms, virtually 90 per cent clearances are today on the automatic route. One of the possible mechanisms, going forward, can be that the parent’s ministry can deal with the case. But the alternative mechanism to FIPB will be much simpler.

On Cheque Bouncing
We are considering further amending the Negotiable Instrument Act to effectively deal with lakhs of cheque bounce cases by reducing timeframe for resolution of such disputes. We need to ensure the payees of dishonoured cheques are able to realise the payments. After a cheque bounces, the litigation process is very complex and takes time. So, for traders with a bounced cheque, litigation takes a long time to recover the money. The Department of Financial Services is working on amendment of the NI Act to ensure that the time taken to redress cheque bounce cases is compressed. There are some suggestions that the persons whose cheque bounces should be allowed to defend the case only after depositing the money in the court first.

(From FM’s Post Budget Press Meet)