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| Jaitley presents first Union Budget 2014-15 of NaMo Govt | | | Agencies
NEW DELHI, July 10: Finance Minister Arun Jaitley today presented the Union Budget 2014-15 amid high expectations from all sections of society. Jaitley said the government is aiming for 7-8 % of growth in the next 3-4 years.
Jaitley said there are challenges to lowering the fiscal deficit as the country has had two years of low GDP growth, an almost static industrial growth, a moderate increase in indirect taxes, a large subsidy burden and not so encouraging tax buoyancy.
FISCAL DEFICIT
Jaitley said the government will retain the fiscal deficit target for 2014-15 at 4.1 per cent of GDP and reduce it further to 3 per cent by 2016-17
Jaitley said he was conscious of the fact that the Iraq crisis is having an impact on oil prices and that the situation in the Arab World continues to be volatile.
DIRECT TAX
The tax exemption limit has been raised to Rs 2.5 lakh from Rs 2 lakh, providing a relief of Rs 50,000.
"I propose not to make any changes in the tax rate. However, with the view to provide relief to small and marginal and senior citizen, I propose to increase the personal income tax exemption limit by Rs 50,000 from Rs 2 lakh to Rs 2.50 lakh in case of all individual tax payer who are below the ago of 60 years," Jaitley said.
The proposal, according to an estimate, is likely to be benefit about 2 crore tax payers.
Similarly, he raised the tax exemption limit from Rs 2.5 lakh to Rs 3 lakh in the case of senior citizens.
TAX EXEMPTION
Seeking to boost household savings, the exemption limit for investments by individuals in financial instruments has been hiked to Rs 1.5 lakh.
Presently the investments and expenditures up to a combined limit of Rs 1 lakh get exemptions under Sections 80C, 80CC and 80CCC of the Income-Tax Act.
Jaitley also raised the tax deduction limit on account of interest of housing loan in case of self occupied property to Rs 2 lakh from Rs 1.5 lakh.
FDI IN INSURANCE
In a big relief to the capital-starved private insurance sector, Jaitley today proposed raising the Foreign Direct Investment (FDI) cap from 26 per cent to 49 per cent.
"The insurance sector is investment starved. Several segments of insurance sector need expansion. The composite cap of the insurance sector is proposed to be increased to 49 per cent from the current level of 26 per cent with full management and control through the FIPB route," he said while presenting the Budget for 2014-15.
The move would help insurance firms to get much needed capital from overseas partners.
GOODS AND SERVICES TAX (GST)
Committing to expeditiously rolling out the Goods and Services Tax (GST), the Finance Minister said a solution to the issues relating to the comprehensive indirect tax regime may be finalised in the current year itself.
The debate on whether to introduce the GST must come to an end now, Jaitley said, adding, "We have discussed the issue for past many years. Some states have been apprehensive about surrendering tax jurisdiction others want to be adequately compensated".
He assured all states that the government would be more than fair in dealing with them.
KISAN TELEVISION
Jaitley announced a new 24-hour TV channel dedicated to the agricultural sector with an outlay of Rs 100 crore for providing real-time information to farmers.
The Finance Minister said that a sum of Rs 100 crore has been set aside for 'Kisan Television' to provide real time information on various farming and agriculture issues.
AGRICULTURE
Faced with a drought-like situation and high food prices, the finance minsiter announced a Rs 1,000 crore scheme to boost irrigation and also set up Rs 500 crore price stabilisation fund to rein in food inflation.
Jaitley retained the agriculture credit target of Rs 8 lakh crore for this fiscal set in the interim Budget.
DEFENCE
As part of military modernisation drive, Jaitley allocated Rs 2.29 lakh crore for the Defence Ministry in the Budget, marking an increase of around 12.5 per cent from the last fiscal as it raised the FDI limit in the defence sector up to 49 per cent from 26 per cent now.
"There can be no compromise with the defence of the country. I, therefore, propose to allocate an amount of Rs 2.29 lakh crore for the current financial year," Jaitley said.
COAL
Adequate coal will be provided to power plants as extensive measures to augment domestic output and a strict mechanism to control fuel quality are being put in place to end the impasse in the sector, the government said today.
"Comprehensive measures for enhancing domestic coal production are being put in place along with stringent mechanism for quality control and environmental protection, which includes supply of crushed coal and setting up of washeries," the Finance Minister said.
The minister added that sufficient quantity of coal will be provided to power producers, thereby unlocking dead investments. |
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