Union Budget 2017-18 is expected to be unique in many aspects, one, this will be the first Budget immediately after demonetisation and second it will be announced on 1 February instead of customary date of February 28. With uncertainty looming large on date of introduction of GST, the Finance Ministry has its task cut out in terms of estimating or one may say guesstimating the indirect tax revenue for the fiscal year 2017-18.
Besides the clearly defined road map for GST roll out, the government may take steps to bridge the gap between the current tax rates vis-à-vis the probable rate in GST so that the negative effect of inflation on introduction of GST can be managed.
I understand that respected Finance Minister has team of economists and financial wizards. However after reading various experts I have few very small points which might be taken in consideration by Ministry of finance. These are from the heart of an average Indian and not on big issues like customs duty and fiscal deficit issues.
Kindly check the following small issues which might make a difference in the life of few
Army Fund u/s 80 G
Donations to various organisations qualify for tax deductions U/S 80 G, However if donation for welfare of army is included in the same it can go a long way to help create better facilities for our jawans
Military Service pay and allowances like hardship allowance to a certain post be out of Income tax. The same can be extended to Police services and BSF. This shall help them save more as they are subject to frequent transfers and school education,
New recruits are now not being paid pension as per my interaction with one of army guys. Request government to start contributing a small portion of their salary to NIFTY funds so that when they retire they have good corpus and security
SENIOR CITIZEN BENEFITS
As India is moving more towards nuclear families senior citizens are left at mercy of their children with no social security. Most of the times old age homes have also no place for them.
Government can think to levy a senior citizen security cess on higher income slabs. That will go a long way in creating funds to help create more and better old age homes and security to them
This always has been a mystery to most of citizens in India. While a salaried class earning a salary of even 6 lacs is subject to all taxes agriculture income even in crores is left exempted for reasons unknown. My understanding highest agriculture income is received in the hands of politicians and influential guys. High time government plug this loophole. A small farmer shall not be affected by this
CORPORATE SOCIAL RESPONSIBILITY
Although government has instructed corporate social responsibility of 2% on corporates, hardly corporates are following it. Globally corporates spend a huge amount on social welfare.. The corporates be either given responsibility to create local infrastructure and take responsibility of education of poor kids in are they operating or create free medical services in their office complex to reduce burden on already crowded government hospitals
As has been voiced by many even i feel the current deduction of Rs 2 lacs U/S 24(B) be increased to help housing sectors and aspirational buyers. Increase in housing activity shall help housing finance companies as well as related industries like cement and steel. The same shall also generate employment
As due to demonetisation most of real estate companies have been hit hard. However if any real estate builder offers a subvention scheme wherein the buyer only has to pay 10% on booking and rest on possession then the builder be given rebate in interest rates, This shall help builder deliver on time and buyer also
ROLE OF CHARTERED ACCOUNTANTS
In the current scenario all corporates and few individuals above thresh hold limits have to get accounts audited by Chartered Accountant. The same involves costs to the business. However even if accounts are vetted by CA the assessing officer on assessment holds the tax payer is held responsible.
Just a statement " ON THE BASIS OF AVAILABLE RECORDS" the CA is free of all liabilities. I fail to understand that if tax payer has to again provide all records to assessing officer then why is certification of a Chartered Accountant required. Either he takes responsibility of his signed balance sheet or as our PM states self certified documents be filed by tax payer
START UP VENTURES
Although the start up have been given tax exemption, the same is not of much relevance as only few start ups are able to make profits in first five years.
The Government should have a start up grievance cell to help ease of doing business. In current situation Red-tapeism has discouraged most of the start ups as taking permissions and denials take away their courage to go ahead.
The banks also do not release funds to start ups. A system should be created where every proposal rejected be given in writing citing exact reasons for denial
The same should also be forwarded to start up grievance cell so that Bank Manager is answerable for his decision of denial.
Organisations helping digital payments be given encouragement by government. To illustrate say HDFC encourages business entity to spend Rs 100 via digital payment by giving discount of Rs 5 on product. Government may give a benefit of Rs 7 to HDFC. The same shall help increase in digital payments and we move faster towards cashless economy
INVESTMENTS AND DEDUCTIONS
Currently Rajeev Gandhi Equity Savings Scheme U/S 80CCG is not very encouraging. The same should be replaced by extra deduction of Rs 50,000 to Rs 1,00,000 in NIFTY FUND. The same shall help investors as the money shall be invested in all blue chip stocks
Fixed Maturity Plans and debt funds were subject to income tax if redeem before three years as government wanted to increase liquidity in banks, However most of retail investors are denied of excellent performance of debt funds as they still go for FD. With FD returns going lower debt funds taxation change should be considered so that small investors also reap the benefit. inclined
With Our PM more inclined towards Skill Development more of vocational institutes be encouraged. The same should have specific workshops for various skills so that more jobs are created and talent utilised at right positions.
The Vocational Institutes be given tax exemptions and financing to help our youth grow to potential.
Finally the slabs most suited today as per my interaction
First four lacs : 0%
4 to 10 lacs : 10%
10 to 20 lacs: 20%
above 20 lacs: 30%
I understand that above points are very minor but looking at wider picture it shall help most of the sections of society. Post Demonetisation government focus should be more on take home income to boost consumption
I hope respected Mr Arun Jaitley shall spare few minutes to read this blog and consider few of above proposals,I have all hopes from our government because it listens to voice of common people.