What can be the effects of Budget 2017 on various Sectors

With the new year set in motion, everyone is looking forward to the budget that may come along with it and the effects it will have on the country all throughout its period of implementation. The government this year has decided many new approaches in this direction which may soon be disclosed.

As an effort by Eustan Ventures, if grossly looked over as presented in news and revelations made by concerned authorities, major changes put into action this year include:

RAILWAYS

  • This year the rail budget will be merged with the general budget stripping the age-old practice of a separate railway budget. Both these budgets will be unified thus, ending distinction between non-plan and plan expenditures. In early years railway budget used to comprise about 70 % of total budget. This will now be narrowed down to about 15%.

  • There might be a reduction in concessions and subsidy on passenger fares in railways. The concessions include like those for sportsperson, freedom fighters, etc.

  • One important thing to focus at is that the merger will not affect the individuality of railways and thus it will retain its functional autonomy. Separate discussions and debates will be held each year in context of railway department so there remains a strong element of Parliamentary accountability.

WHY BUDGET THIS YEAR IS PREPONED

  • Preponement of the budget 2017-2018 by about one month is also taking place this year as stated by PMO. This is to ensure speedier and efficient implementation of projects and schemes. Each year the budget is released on the last working day of February.

  • This year the budget will be released at around 1st of February and thus, it is expected that all bills regarding new schemes will be passed by 31st of March. So, these can get funds at beginning of new financial year at 1st of April, 2017. This will provide with a longer time for implementation of these schemes which otherwise get implemented by October each year and thus there is only a half year left for their implementation.

  • Also, new expenditures and tax proposals will come into play right after beginning of new fiscal. These proposals so far seem to be really canny displaying governments act of saving unnecessary funds spent and also the time wasted.

ECONOMY

  • With scraping off of old currency notes, there might a finishing touch in the Union Budget 2017-2018 to discourage people from using cash transactions. Tax rebates and incentives may be announced to encourage payments by card and digital modes.

  • One can expect GST(Goods and Services Tax) to be a part of this year’s budget. This is expected to bind together a common national market and also to join several state and central duties into one.

  • Big announcements in income tax slabs and rates are anticipated. To discourage people from stocking cash up, incentives and raised tax breaks offered on money in fixed deposits, mutual funds, etc. are expected.

  • Manufacturing sector may have several tax incentives for labor-intensive leather, gem and jewelry industry. “Make in India” will certainly comprise a large part of schemes set in this sector. This will boost manufacturing, and improve exports.

START-UPS

  • Eustan Ventures believes it’s the time to celebrate for new entrepreneurs. Start-ups should expect good news as it is expected that initiatives to empower start-ups will be announced. It will include widening of tax holiday from 3 years to 5 years and faster procedural clearance.

INVESTORS

  • The infrastructure sector seems promising this year since the plethora of approvals will now be reduced allowing a single window clearance thus attracting bulk of investors in this direction.

  • Corporate tax may be reduced to 28.5-28.75% from current rate of 30%. But exemptions will be removed. Thus, preventing companies to cut down their effective tax payments.

This is what one can expect out of Budget 2017-2018 according to present trends. Rest will become clear once the Budget is out.