Union budget 2017 countdown has already begun following the Supreme Court’s decision to dismiss plea requests made to reschedule the date. This time, the budget will be read one month earlier on 1st of February as opposed to the last day of the month. This advancement of fiscal budget is said to ensure all spending and tax proposals are complete before the beginning of the next year. After the court denied request to reschedule on Monday, the interest has shifted to what India can expect from the Union budget 2017. Here is a look at some of the changes to anticipate on 1st.
1) Upward revision of income tax slabs
Arun Jaitley is expected to announce increased income tax slabs on February 1st 2017. There are many rumors regarding this and the government is expected to raise the current tax limit of Rs 2.5 lakh to Rs 4 lakh. This move will benefit the common tax payer in the country as their income taxes will significantly drop within this new slab.
2) Increase in cashless transactions
Union budget 2017 – 18 will be the first budget read after demonetization and it is expected to encourage more cashless transactions. People can expect discounts of card and toll booth transactions made using credit cards. Waivers on payments through debit cards and promotion of mobile wallets are a few ways the government will use to encourage cashless transactions.
3) Real estate changes
The major real estate GDP contributors suffered a lot in the current fiscal year. Demonetization and RERA (real estate regulatory act) resulted in massive damages to the real estate as buyers, sellers and constructors all experienced challenges of cash crunch. The budget is expected to relax income tax rates, increase HRA deduction caps for salaried employees and standardize the cost of construction materials. These changes are targeted to revive the crushing real estate sector.
4) Increased deduction for housing loan interest
Back in 2015, the government announced PMAY which was a project aimed to provide affordable housing to everyone. As a continuation of the project, many are expecting tax concessions especially with regards to interest paid on housing loans. An increase is deduction on interest tax will benefit both the housing sector and trickle down to the buyers.
5) Relief for farmers
Farmers, particularly those in rural areas were heavily impacted by demonetization that saw the note ban cause insufficient cash to complete transactions. The budget is expected to come up with a plan to compensate farmers who were affected by the changes. New modes of cashless transactions for the rural areas are also expected to make the purchase of fertilizer, seeds and other farm supplies possible.
This will be the fourth NDA budget and many other new things are expected on 1st. most changes will be guided to deal with the challenges brought by demonetization as a way to make the transition seamless and less challenging. It is also expected that the government will offer more waivers and benefits to those who embrace cashless transaction. India now has two events to look forward to; the Union budget 2017 and assembly elections that are also fast approaching.