Budget 2018 and its Possible Impact on Stock Market

The future movements in the markets over the next month or so will be decided by the contents of the Budget 2018.

Lately both the major indices in India has scaled record heights, the Sensex has crossed the 36000 mark whereas the Nifty has also breached the 11000 level.The future movements in the markets over the next month or so will be decided by the contents of the Budget 2018. Although in the period leading up to the Budget utmost secrecy is observed but some information does filter through, other than that rumours and informed speculations are also what that drives the sentiments of the markets. Generally there are negative sentiments and expectations attached to the Budget thus investors usually postpone buying decisions before the Budget is tabled. Thus in the past mostly the benchmark index has fallen in the month leading up to the Budget and the markets both Sensex and Nifty have seen gains after the Budget has been delivered. This has been the trend in six out of the last nine Budgets. But the said trend has now been broken with the markets touching new heights just before the Budget 2018. Few numbers in the Budget 2018 such as that of fiscal deficit and disinvestment targets will have a major impact on the direction of the bourses. Experts believe that the days leading up to the Budget the markets will see a rally due to various anticipations and right after the Budget profit booking in the stock market may be seen. However, there will be opportunities for investment in select sectors also.

Expected Impact of Budget 2018 on Stock Market
It is largely expected that the Budget 2018 will be neutral for the stock markets thus no sharp surge or dip in Indian indices is being expected. As the said Budget is the last full budget before the Lok Sabha elections in 2019 and before multiple assembly elections in 2018 no major reforms are expected to be undertaken. Experts believe that in the near future with record FII inflows, soaring investments in mutual fund, low interest rates and a strong rupee against the dollar the outlook in the markets is expected to remain positive. Although on the day of the Budget 2018 and the 48 to 72 hours period after the same the markets are expected to remain extremely volatile. In the Budget 2018 the markets would like to see a bump up in Government’s revenues to tackle fiscal deficit but most likely the fiscal deficit target of 3.2% of the GDP would be missed by the Government. The target is most likely to be revised to 3.4% which will have a somewhat negative impact on the markets. The markets also expect the government to pursue disinvestment agenda aggressively especially that of Air India. Relief in corporate tax rates and personal income tax along with stabilization of the Goods and Services Tax (GST) and increased public spending with focus on manufacturing, job creation and rural distress are some other key expectations of investors that will have a major impact on the markets.

Possible Reasons for Rise and Fall in the Markets after the Budget 2018
The FM most likely will try and strike a balance between popularism and fiscal prudence in the Budget 2018. The Indian market is already at historical highs so experts believe that even an industry friendly budget will have only a nominal impact. On the other hand if there are some dreadful surprises in the Budget 2018 then even a crash cannot be ruled out. One of the major decisions that the markets is hoping doesn’t materialise is the introduction of long-term capital gains tax (LTCG) on shares.

Economic Survey 2018: Formal jobs far more than current official estimates

Ther are 220 million employees in the economy, out of which 75 million workers enjoying social security benefits

Formal jobs are much more than what the current official estimates, the Economic Survey 2018 released on Monday said.

The Survey, analysing the data from goods and services tax (GST) and newly available digitised government data, said there were a total of 220 million (22 crore) employees in the economy, out of which 75 million (7.5 crore) workers enjoying social security benefits at present.

The Survey defined formal employment in two parts — First, those receiving social security benefits from Employees’ State Insurance Corporation and Employees’ Provident Fund Organisation. Second, those receiving it from firms under the GST regime.

“From a social security perspective, formal employment amounts to 60 million (6 crore), to which we must add an estimated 15 million (1.5 crore) of government workers (excluding defence), for a total of 75 million (7.5 crore),” the survey said.

From a tax perspective, formal employment is 112 million (11.2 crore) and government employment yields a total count of 127 million (12.7 crore), it noted. “Notwithstanding the caveats regarding the specific numbers, the broad conclusion is likely to be robust: formal payrolls may be considerably greater than currently believed,” the survey said.

The Survey added that when formality was defined in terms of social security provisions like EPFO or ESIC, the formal sector payroll was found to be about 31 per cent of the non-agricultural workforce. When formality was defined in terms of being part of the GST net, such formal sector payroll share stood at 53 per cent, it said.

“Even so, it is clear that providing India’s young and burgeoning labour force with good, high-productivity jobs will remain a pressing medium-term challenge. An effective response will encompass multiple levers and strategies, and above all, creating a climate for rapid economic growth on the strength of the only two truly sustainable engines — private investment and exports,” according to the Survey.

Budget session LIVE: CEA predicts achhe din in 2019, lists govt's successes

Economic Survey 2018 is a flagship annual document of the Finance Ministry that reviews the overall state of the economy

Live Budget 2018 : The Economic Survey 2017-18, tabled in Parliament on Monday, forecasts gross domestic product growth for 2018-19 at 7-7.5 per cent, compared with a forecast of 6.75 per cent in the current fiscal year.

“A series of major reforms undertaken over the past year will allow real GDP growth to reach 6.75 percent this fiscal and will rise to 7.0 to 7.5 per cent in 2018-19, thereby re-instating India as the world‘s fastest growing major economy,” an official statement said, after the tabling of the survey, adding that “the reform measures undertaken in 2017-18 can be strengthened further in 2018-19.

The survey said that due to the launch of ‘transformational’ Goods and Services Tax (GST), resolution of the long-festering Twin Balance Sheet (TBS) problem by sending the major stressed companies for resolution under the new Indian Bankruptcy Code, implementing a major recapitalization package to strengthen the public sector banks, further liberalisation of FDI and the export uplift from the global recovery, the economy began to accelerate in the second half of the year.

In a highlighted box titled “Ten New Facts on the Indian Economy”, the survey stated that there was a large increase in registered direct and indirect tax payers due to demonetization and GST respectively, and that formal non-agricultural payroll was much greater than earlier anticipated.

What is Economic Survey?

It is a flagship annual document of the Finance Ministry. It reviews the overall state of the economy in the last 12 months. In August last year, however, the government for the first time presented a mid-term economic survey.

Arvind Subramanian

States and urban and rural local governments collect low levels of direct taxes even relative to the powers they already have. Does this imply a low-equilibrium accountability-delivery trap?

• India’s states and third-tier institutions (urban and rural local governments) collect a lower share of revenue by way of direct taxes than their counterparts in other federal countries.
• If you look over the last 50-60 years of India, we have moved from "crony socialism" to "stigmatized capitalism": CEA

Arvind Subramanian

India is in the midst of simultaneous slump in investment and saving rates post GFC. Investment went up 9.1 percentage points in 4 years during mid 2000s and has declined by about 6.3 percentage points in 8 years since GFC.

Budget 2018: New bottoms-up mechanism for farm-gate marketing likely

The Budget 2018-19 may announce haats and organic hubs in 1,000 village clusters across the country.

Modelled on Harihar Haath in Jagdalpur district of Chhattisgarh, these markets will enable villagers to sell their produce directly to consumers, bypassing middlemen, thereby helping them realise a good price for their produce.

Started as a pilot project in 2017, Harihar Haath is a unique bottoms-up approach to farm marketing. It is a consortium of four farmer-producer companies, five cooperatives, and 13 women self-help groups. It has been taking great strides to create a risk-free space for farmers.

The farmers collectively purchase goods from growers and sell them at rates lower than prevailing market prices. Most of the farmers are women, drawn from self-help groups under the Mahila Kisan Sashaktikaran Pariyojana of the rural development ministry.

The state and district administrations provide them space for selling their produce. With monthly sales of over Rs 200,000 and profits of over Rs 50,000, Harihar Haath handles 250 customer footfalls per day, and sells 1.5 tonnes of produce daily.

“We want the Harihar Haath model to be replicated in many more places across the country,” an official said.

These clusters are part of the 5,000-odd ones already identified by the Mission Antodaya programme. The mission, which aims to rid 50,000 gram panchayats of poverty in 1,000 days by converging all schemes, was announced in the Budget for 2017-18 by Finance Minister Arun Jaitley.

It is a state-level initiative for rural transformation to make a difference based on measurable outcomes to the lives of 10 million households in 5,000 rural clusters. The gram panchayats chosen possess a high level of social capital and have the ability to implement rapid rural transformation for poverty elimination.

The mission encourages partnerships with a network of professionals, institutions and enterprises to accelerate the transformation of rural livelihoods. Self-help groups are enablers due to their social capital and their proven capacity for social mobilisation.

The government has started the process of ranking gram panchayats and identifying their basic needs and economic standards so that targeted interventions can be made.

The sorting of 1,000 clusters out of the 5,000 identified will help in creating additional livelihood opportunities in villages. The clusters, yet to be identified, are ones that have a strong agricultural base and where farmers will be encouraged to grow and sell produce free of pesticide and chemicals.

Women farmers and self-help groups along with farmer producer companies will form the backbone of this infrastructure.

Budget 2018: A 15-year, Rs 35.3-trillion plan to put Railways on track

The Indian Railways is working on a Rs 35.3-trillion investment plan by 2032, pushing up the capital expenditure for the ministry by around 92 per cent annually. Going by the ambitious vision, the average annual investment, including capacity addition and modernization, would touch around Rs 2.5 trillion, up from the Rs 1.31 trillion in 2017-18.

This long-term investment will also comprise the modernisation plan of ‘Vision 2030’ and also Rs 8.56-trillion investment target that former minister Suresh Prabhu had kicked off starting 2014-15. “The Indian Railways will require approximately Rs 35.3 trillion by 2032 to create the requisite capacity and modernize the system,” the ministry said in a report to the Parliamentary Standing Committee. The Railways, under Piyush Goyal, has already started the work, aiming to achieve at least 4000 km electrification per year in the coming years.

budget 2018 India : The capex for Railways during 2015-16 and 2016-17 were Rs 935.2 billion and Rs 1.21 trillion, respectively, posting a significant increase in the recent years.

As per the latest plan, railways freight share may zoom from 33 per cent now to around 47 per cent. It has also set a target of increasing the passenger kilometre to 3.3 trillion PKM in 2030, from about 1.13 trillion PKM now. While the completion of dedicated freight corridors would segregate freight and passenger traffic on high density routes, speed of freight trains will increase from 25 km per hour (kmph) to 100 kmph.

With this, train speed is expected to be increased to 160-200 kmph in order to ensure better intercity travel up to 500 km in three to four hours. “In the ten years starting from 2020 to 2030, we are targeting more than 4000 km of new lines, doubling of 10,000 km and almost 100 per cent electrification,” an official said.

Asset monetisation will be one of the key revenue sources with the share of non-fare revenue likely to go up to almost 20 per cent from the current 4 per cent range in the next 12 years. In addition, the upcoming Budget may announce overhauling of the signalling system and implementation of the European Train Control System (ETCS) technology. This could cost the Railways around Rs 600 billion to cover the entire country. Also, a Rs 1-trillion plan has been lined up for commercial development of railway stations.

Of the Rs 8.56 trillion lined up for the first five years of Vision 2030, Rs 4 trillion has already been invested. A majority of this will go towards network decongestion, including freight corridor and electrification, network expansion and safety. In fact, over the next couple of years, at least 8,000 km of old tracks will be replaced, at an estimated cost of Rs 100 billion.

Around 30 per cent of the Rs 8.56-trillion capex for five years is expected to come from budgetary, 28 per cent from debt, and about 15 per cent through internal generation. Indian Railway Finance Corporation is arranging a debt of Rs 2.5 trillion to meet the five-year investment target.

Budget 2018: Has Modi govt delivered on its promise of urban development?

BJP govt faces this situation as it heads into its last full budget before general elections in 2019

Budget 2018 India : With India’s urban population rising by 11 million annually–the equivalent of adding a Bengaluru every year–and urban voters forming a major vote base for the Bharatiya Janata Party (BJP), making money and management available for cities would appear to be a priority.

But promises of smart cities and managing growth to provide jobs and housing for the coming urban population jump from 377 million in 2011 to 600 million in 2031–with 20% of this growth expected to come from rural distress and migration–are, currently, displaying little progress.

Less than a quarter of central funds for four major national programmes for India’s urban renewal have been used, according to an IndiaSpend analysis of government data. Since urban development is a state subject, state governments implement these national schemes with central assistance playing a key role. State and urban bodies are also expected to finance a portion of the program on their own by raising funds from other sources.

A further disaggregation of central funds data from the ministry of housing and urban affairs reveals:

• Upto February 2017–the last release of data–no more than 3% of smart-city projects were completed and 12% of central funds were released;
• With two years to deadline, the Centre–as of July 2017, the last release of data–was still to release 87% of funds for urban infrastructure in 500 cities and towns;
• Upto July 2017, 95.4% of central funds sanctioned for upgrading 12 heritage cities were unused, as the programme’s November 2018 deadline approaches;
• Work on 93% of sanctioned houses–meant to meet 16% of India’s urban housing shortage–was incomplete as of January 2018. The target of housing for all: 2022;
• Little is known of how state governments are raising funds and implementing these programmes.

This is the situation facing the BJP government, as it heads into its last full budget before general elections in 2019, at a time when Prime Minister Narendra Modi has promised 100 smart cities and housing for all by 2022.

The urban sector will not just watch how much money is set aside in the 2018-19 budget but also how it is used, as the National Democratic Alliance (NDA) tries to deliver on its promises of urban development and rejuvenation ahead of upcoming assembly elections in eight states and the 2019 general elections.

budget 2018: Logistics region wants FM Jaitley to raise regulatory limitations

the world also expects the Narendra Modi authorities to provide a unbroken, transparent digital platform to make sure easy movement of goods and vehicles throughout the united states of america

nowadays, the Narendra Modi-led imperative authorities has delivered in numerous measures to uplift the united states of america’s economic system. It has additionally set the level for unlocking the boom capacity for India’s logistics sector

by means of putting in a devoted logistics division beneath the Ministry of trade & enterprise and granting the arena an infrastructure fame.

Now as the government heads for its last complete finances on this phrases when Finance Minister Arun Jaitley offers Union Budge 2018 on February 1, we would sit up for seeing greater emphasis on enhancing the infrastructure.

ultimate 12 months, we saw the finance minister pronouncing an investment of approximately Rs 39.61 lakh crore in infrastructure development. that is sure to be a boon – now not handiest for express delivery players however for lots industries.

This year, we'd also count on efforts from the government to cut regulatory barriers and provide a seamless, transparent

virtual platform to make certain smooth movement of goods and motors throughout the united states of america. lastly, our price range 2018 expectation is that the finance minister could announce new schemes focused on fiscal incentives to encourage investments in special monetary zones (SEZs). those will allow the non-public quarter to consolidate and expand, and contribute to the economy greater meaningfully.

the writer is dealing with director of courier and logistics business enterprise TCI express

Budget 2018: Eyes on Arun Jaitley's announcements for rural sector

The Budget allocation for Ministry of Agriculture and allied activities has grown by 114% since 2010-11

As Finance Minister Arun Jaitley gets down to deliver his fifth annual Budget for the 2018-19 financial year, all eyes will be on his announcements for the rural sector which is going through a downturn in the last few years. Two consecutive droughts along with a sharp fall in incomes have turned agriculture unprofitable resulting in massive agitations in several parts of the country.

Budget 2018 : According to some estimates, in the 2017 Kharif season alone, an estimated Rs 360 billion has been denied to farmers for not being able to sell their produce at the state-mandated Minimum Support Price (MSP). The fall in farm incomes not only threatens to dent the ruling BJP electorally but could also raise a big question mark on the government’s promise to double incomes by 2022.

In this perspective, Business Standard looks at budgetary allocation for agriculture and allied sectors in the past few years under the UPA and first years of the NDA along with agriculture growth during these years.

The Budget allocation for Ministry of Agriculture and allied activities, which includes the departments of agriculture research and animal husbandry, has grown by 114% since 2010-11, with a big jump coming from 2016-17 after the government started adding the expenditure incurred on interest subvention on short-term crop loans under the Ministry of Agriculture.

But, the higher budgetary allocation hasn’t translated big time into farm growth, projected to drop to its lowest level in recent times in 2017-18, according to the first Advanced Estimate. Though, allocations aren’t meant to boost growth and just give the direction of the govt’s spending.

more appropriate factor in farm growth seems to be the performance of the southwest monsoon, which has been erratic in 2014 and 2015. 2016 was the first full-year of a near-normal monsoon under NDA-2.

Note: Starting from 2016-17 Budget, the central government has been adding the component of interest subvention on short-term crop loans into agriculture ministry's Budget. Earlier, it was part of the Budget of the Ministry of Finance; LPA: Long-period average.

Budget 2018: This is why Maharashtra's drought woes are likely to continue

Even after 20 years, irrigation projects worth Rs 9 billion remain incomplete and now their cost is expected to be more than Rs 50 billion

In many ways, the Lendi irrigation project close to the Andhra Pradesh-Maharashtra border continues to be a prime example of the excruciating delays that have plagued irrigation projects in India.

Conceived in 1987, this major irrigation project was to be completed in 1992. The project involved building a dam at the Lendi river to store over 6 trillion cubic metres of water before it joined the Manjira river, a tributary of the Godavari, the largest river of peninsular India. The project being executed by the Godavari Marathwada Irrigation Development Corporation Ltd was originally envisaged to be built at the cost of half a billion rupees. But in 2016, authorities further pushed the completion date to 2020 with a revised cost of Rs 14 billion. If the project is completed after 28 years of delay, it will join 16 other such irrigation projects in Maharashtra that have been hanging fire for over two decades. Many of these projects are in the severe drought-hit regions of Vidarbha and Marathwada in the state.

Budget 2018 : This shouldn’t have been much of a bother for Finance Minister Arun Jaitley, who gets set to present his government’s last full-fledged Budget on February 1, 2018. But the fact that such delayed projects dot Maharashtra would certainly rankle the finance minister. Information sourced from his ministry shows that these multi-decade delays in completing minor and major irrigation projects across Maharashtra have cost the government a lot of money over the years. Out of a total of 29 irrigation projects under construction in the state, 16 are delayed with massive time lags. These projects that should have been completed at an estimated cost of Rs 9 billion will now end up costing more than Rs 50 billion. And the fate of those expected to be commissioned in 2018 still remains unclear.

Maharashtra might be India’s richest state, yet every year the state faces debilitating droughts leading to destruction of farm livelihoods and loss of life due to the paucity of drinking water. In 2013, the state faced its worst drought ever. If that wasn’t enough, in 2015 and 2016 severe droughts again hit the state. Reports suggest that the state’s farmers sought insurance to the tune of Rs 41 billion for crop losses due to drought in 2016. That year, the agriculture sector in the state contracted by 4.6 per cent.

While Jaitley might be inclined to announce new irrigation projects for Maharashtra, the Narendra Modi administration might do well to ensure that irrigation projects scheduled to be completed this year and the ones hanging fire for more than two decades see the light of the day first, without suffering the same fate as other projects like the Lendi irrigation project. Finance ministry data show that at least six irrigation projects in the drought-hit state are scheduled to be commissioned in 2018. All these projects were conceived before 1997. Although conceived at a cost of Rs 7 billion, their revised completion cost 20 years later exceeds Rs 27 billion.

Annual Budget 2018

Annual budget in simple language means a projected income and expenditure for the entire 12 months. The Annual budgets apply to a fiscal year or calendar year.

Annual budget in simple language means a projected income and expenditure for the entire 12 months. The Annual budgets apply to a fiscal year or calendar year. There is a need to create an annual budget for a country, as it is not possible to levy taxes as and when the income is needed and spend money in whichever sphere the government decides. Keeping the limited resources, a well-planned Union budget is created by indicating the income and expenditure.

What is Union Budget?

Our parliamentary system works on West Minister model. Our Annual budget is approved subject to the approval of legislature at both center and state levels. The Annual financial statements is presented before both the houses of Parliament. This is also termed as the budget of the Union government. The expenditure estimates included in the budget has to be presented before the Lok Sabha in the form of “Demand for Grants”.

Union Budget Date

In Our country, the budget is presented on a fixed date as decided by the President. This year The Union Budget 2018 will be presented on February 1, Parliamentary Affairs Minister Ananth Kumar announced on 5th of January. The minister further stated that the budget session of the parliament will be conducted from January 29 to April 6, 2018.
The Phase 1 of the session will be held from January 29 to February 9 while the second phase will be from March 5 to April 6, as told by Mr. Kumar.

Union Budget 2018 : Economic Facets and Taxation

The budget will be presented by the Finance Minister Mr. Arun Jaitley in the noon for the fiscal year 2018-19. President Ramnath Kovind will address both the houses of the Parliament on January 29, 2018. Last year also the budget presentation date was the same. The Union budget presentation is usually in two parts; Part A: Economic Survey, Part B: Taxation proposals. On January 29th itself Economic survey will be presented before both the houses.

Union Budget 2018: Post GST And Demonetization

This year’s budget has significance as it is the first budget presented after the post GST and demonetization era. This budget is also the last budget to be presented to Prime Minister Modi Government. This will also be the last budget presentation by Mr. Jaitley before the general election in 2019.

Union Budget 2018: Agriculture Being Highest Priority

The general presentation of the budget and its outlines will be presented from January 29 to February 9, 2018. The Parliament will commence again from March 5th to April 6th to discuss taxation proposals. Both the sessions will have a recess in between for the standing committees to clear the budgetary proposals. Last year the government has scrapped the practice of separate railway budget. In an interview given by Mr.Jaitley the agricultural sector will receive the highest priority in the Union Budget this year.

All eyes are set on the Union budget for 2018-29, and what is in store for our country for this year. We will have to wait for the Union Budget sessions to commence and Mr. Jaitley to make budgetary announcements.

Budget 2018: Govt to extend Modi's flagship PMJDY scheme, double overdraft

The financial inclusion scheme could also reportedly see the overdraft amount sanctioned under it double as the government looks to use it to promote entrepreneurship by providing bank loans

Prime Minister Narendra Modi's flagship programme, the Pradhan Mantri Jan-Dhan Yojana (PMJDY), which completed three years in August last year and was credited by Finance Minister Arun Jaitley for unleashing the "JAM" -- Jan Dhan, Aadhaar, Mobile -- revolution, is set to receive an extension in Budget 2018, which is just days away. The financial inclusion scheme could also reportedly see the overdraft amount sanctioned under it double as the government looks to use it to promote entrepreneurship by providing bank loans.

A senior government official told financial daily The Economic Times that during Budget 2018, an announcement on PMJDY being extended is expected. The unnamed official added that an increase in the overdraft amount under the scheme could also be on the cards. Stating that the government was looking to "build upon" the scheme, the official told the financial daily that it was also going to "bundle other financial products" under PMJDY, which will see its second phase end in August.

Currently, under PMJDY, one account, preferably belonging to a woman, in every household can avail of an overdraft of Rs 5,000 once the account has been satisfactorily operated for six months. According to the financial daily, this amount could be doubled to Rs 10,000 in order to allow access to easy emergency funds. The above-mentioned government official told the financial daily that such a move was "being discussed" and the overdraft amount could be "doubled" for those accounts that are "receiving direct benefit transfer through one or more schemes".

Originally envisioned for providing financial inclusion to all Indian citizens by ensuring that at least one person from every household possesses a bank account, the PMJDY scheme is also being seen by the government as a vehicle for promoting entrepreneurship. According to the financial daily, the government plans to push lenders to provide entrepreneurship a boost using the good operative accounts.

Modi's flagship financial inclusion scheme:

The stated objective of the ambitious scheme is to bring society's excluded sections under the formal financial system's umbrella.

As of October last year, close to 300 million (30 crore) people had opened accounts under the scheme, which was launched in 2014 by PM Modi. At present, according to the latest data available on the PMJDY site, 309.7 million (30.97 crore) beneficiaries have banked under the scheme, the beneficiary accounts hold a balance of Rs 736.90 billion (73,689.72 crore), and 126,000 (1.26 lakh) Bank Mitras are delivering branch-less banking services in sub-service areas.

Budget 2018: Tax managers want Arun Jaitley to align cycle to calendar year

Jurisdiction-free e-assessments, gradual reduction in personal tax rates in line with changes in corporation tax and enhanced tax breaks for education of kids are among other key demands

A Deloitte survey of pre-Budget expectations of managers on personal income tax shows that most give a thumbs-up to aligning the tax year with the calendar year. Jurisdiction-free e-assessment of tax returns, a gradual reduction in personal tax rates in line with changes to the corporation tax structure and enhanced tax breaks for education of kids are among other key Budget 2018 demands from Finance Minister Arun Jaitley.

Indian managers are keen to align the tax year (April-March) with the calendar year (January-December), despite chances of initial hardships. In a survey of around 700-odd managers, a majority of respondents (84 per cent) want the Indian tax year to be changed from the financial year to the calendar year. A little over half (52 per cent) are in favour of bringing agricultural income under the tax ambit. Interestingly, one-third of the respondents (33 per cent) did not agree to tax on agriculture income.

Close to two-thirds (64 per cent) of the respondents gave an equivocal thumbs-up to the concept of jurisdiction-free e-assessment. E-assessments are seen as part of the tax department's endeavour to expedite and simplify assessment proceedings, reduce the taxpayer's inconvenience and stamp out corruption. However, 20 per cent of the respondents believe that this move would not be beneficial. The remaining 16 per cent are not sure if this move would be of any help.

In line with the gradual reduction of corporation tax rates for domestic companies from 30 per cent to 25 per cent, most respondents are in favour of a similar reduction in the tax rates for individuals from 30 per cent to 25 per cent. A majority of the survey respondents (86 per cent) are of the view that a similar reduction of tax rate should be given to individual taxpayers. The survey noted that any reduction in the tax rate would place more money in the hands of end consumers, resulting in a boost for domestic demand.

Salaried employees are keen to see an increase in the limit for deduction under Section 80C towards certain payments and investments, currently capped at Rs 150,000. A majority of the respondents (80 per cent) desire the limit under Section 80C to be increased to Rs 250,000. The remaining 20 per cent want the ceiling raised to Rs 200,000. "Such benefits would be two-fold, wherein individual taxpayers would be willing to save more and, in turn, will benefit from a lower tax outgo," the survey noted.

There is a strong demand (79 per cent) among respondents for re-introduction of the tax-saving infrastructure bonds. Out of these, 58 per cent of the respondents indicated that the deduction should be reintroduced with a limit of Rs 50,000, while 21 per cent of respondents were of the view that the deduction be reintroduced with a limit of Rs 35,000.

Union Budget 2018 to bring income tax cheer? Here's why this EY survey thinks so

About 59% of the respondents were of the view that multiple outdated deductions would be replaced with a standard deduction in order to reduce the tax burden of employees

The government is likely to tweak income tax slabs and rates in Budget 2018-19 to bring down the burden on individuals, while there is unlikely to be any change in the current taxation of dividends, according to a survey by EY.

In a pre-Budget survey by tax consultant EY, a wide majority of 69 per cent of the respondents felt that the threshold limits for taxation would increase further in order to boost disposable income in the hands of the people.

About 59 per cent of the respondents were of the view that multiple outdated deductions would be replaced with a standard deduction in order to reduce the tax burden of employees.

The survey includes the views of 150 CFOs, tax heads, and senior finance professionals and was conducted in January.

About 48 per cent of the respondents said they expect the finance minister to lower corporate tax rate to 25 per cent but the surcharge would continue.

Most of the respondents (65 per cent) do not anticipate a change in the current taxation of dividends at this stage. About 24 per cent of the respondents feel that with a view to lowering the overall burden on the corporate sector, the government may lower the rate to 10 per cent.

"The pre-Budget 2018 EY Survey with business decision makers reveals a consensus amongst India Inc for stability and consistency in tax policies and a moderate tax structure. There seems to be little expectation of any major direct tax overhaul after the transformative introduction of GST earlier in the year," EY India National Tax Leader Sudhir Kapadia said.

Budget 2018: Raise funds for education, tax relief under GST, says Assocham

Actual public expenditure over the years even after the additional revenue garnered through levies of education cess surcharges for education, however, was only around four percent

With the Union Budget to be presented in ten days, the Assocham has recommended enhancing the outlay for the education sector, along with greater tax relief for higher education under the Goods and Services Tax (GST).

"The Union Budget 2018 would be the first after imposition of GST. A time has come for correcting the distortions which were earlier brought in by repeated amendments in the service tax for education sector. The last amendment brought in March 2017, denying tax relief for listed services for higher educational institutions; needs to be immediately withdrawn and end the untenable discrimination against higher education institutions, '' Assocham Secretary General D S Rawat said in a letter to Finance Minister Arun Jaitley.

The chamber said no clarification was given for the sudden disruption in the age-old parity of higher educational institutions, universities, research institutions all with higher secondary schools in the matter of limited tax exemption made available to primary school upward to higher secondary level.

"Educational institutions constitute a composite tree-root, stem, branch, - from primary schools to colleges, professional institutes, universities, research institutions. Together they are all inter-dependant and integrally inter-related for the national education system as a whole. Any distinction to separate the higher education institutions from the building blocks in the pyramid-primarily, middle, secondary and higher secondary schools-would be invidious and untenable," the letter read.

The chamber also highlighted that most higher education institutions and numerous private universities which have come up after legislative modifications in the Centre and States in the last decade are facing serious financial problems with their huge capital requirements and non availability of concessional finance.

Higher educational institutions have neither the capacity to absorb the new tax burden nor the power to pass on the same by increase in fees to students with external state regulation and risk of agitation in the campus.

"From the Kothari Commission to the recent Subramanian Committee (set up after the 2016 National Policy of Education) the expert recommendation and national view had been for a minimum public outlay on education of six percent of GDP," said Assocham in its letter.

Actual public expenditure over the years even after the additional revenue garnered through levies of education cess surcharges for education, however, was only around four percent. Therefore, the chamber called for higher public expenditure on education at all levels - from schools to universities, and advanced research institutions.

Budget 2018: Reeling under dwindling exports, AEPC seeks several relief

The apparel export body has made around 8-10 demands ahead of the Budget 2018

Reeling from a continued fall in export growth and marginal refunds on the goods and services tax (GST), the Apparel Export Promotion Council (AEPC) has written to the government, seeking 12-15 types of relief. They want the duty drawback and the refund of state levies (ROSL) to be restored to pre-GST levels, and also exemptions from the new indirect tax for exporters.

Growth of apparel exports has clocked a negative 39 per cent, 11 per cent and 8 per cent, respectively, in October, November and December last year, according to H K L Magu, chairman, AEPC.

Now, in the run-up to the Union Budget 2018, the export body has sought incentives from the government, to boost exports. It wants the duty drawback on cotton apparels to be restored to pre-GST rates of 7.5 per cent and the ROSL of 3.5 per cent. They also want to be exempted from 18 per cent GST for air freight.

After the GST roll-out last year, the duty drawback fell to 2 per cent; ROSL to 1.5 per cent on cotton apparels, and 2.5 per cent and 1.5 per cent, respectively, on different man-made apparels.

Till September, when the previous rates were applicable, apparel exports grew in double-digits. However, October onwards, exports began taking a hit.

“We have been asking the government to support apparel exporters to survive. There have been blockages of funds between July and December; hardly anybody got GST refunds. Dollar weakened to be valued at Rs 63. We have become uncompetitive; Bangladesh has begun cashing in on this,” said Magu.

He added, “The government did take notice of the impact. Hence, in the mid-term review, the merchandise export incentive scheme was increased from 2 per cent to 4 per cent. However, more steps are needed to revive the industry.

Union Budget 2018: Unfair to judge me on demonetisation and GST only, says Narendra Modi

Countering the allegation that his government had reneged on the promise of making 10 million jobs a year, high Minister Narendra Modi quoted a current take a look at showing seven million jobs had been created inside the formal zone by myself inside the cutting-edge economic 12 months.

Union Budget 2018 : “This statistics of 7 million jobs is not like building castles within the air. it has been calculated with the aid of an independent organization on the basis of EPFO (personnel’ Provident Fund business enterprise) figures,” Modi said in a tv interview, days before leaving for Davos to wait the arena monetary discussion board meet.
One have to additionally remember the opportunities that had been being created in the informal sector, he introduced.

“As many as one hundred million people have taken loans from the high Minister Mudra Yojana with none financial institution guarantee. Loans to the tune of Rs 4 trillion have been distributed. New entrepreneurs are being created. won’t you matter these figures as activity creation?” he asked.

“you could counter these figures at the political traces, however these numbers aren't primarily based on simply wishful questioning,” he said. “we're at the proper tune so far as activity introduction is worried.”

In step with a study authored by SBI group leader financial guide Soumya Kanti Ghosh and IIM Bangalore professor Pulak Ghosh, 590,000 jobs have been generated each month till November within the contemporary monetary 12 months. because of this seven million jobs will be created within the formal zone in 2017-18 if one expands the fashion on a seasoned-rata foundation.

The study, titled “in the direction of a Payroll Reporting in India”, calculated the variety of jobs in corporations from the membership of the EPFO, the personnel’ nation insurance organisation, the overall Provident Fund, and the countrywide Pension gadget (NPS). so far as information from the EPFO is worried, the observe estimated that three.68 million jobs have been generated till November of FY18, which would imply 5.five million within the complete 12 months. this will be higher than the four.5 million created the previous economic year, a length which saw disruption from demonetisation.

when requested as to what type of finances, the closing complete one of the Narendra Modi government, it will be, the top minister said the mantra of his authorities become improvement. “whether or not this is the final finances or the primary budget, whether there are elections or no longer, the mantra of Modi is best improvement, improvement and improvement. the mantra of the Bharatiya Janata birthday celebration is best improvement. Sabka sath, sabka vikas (Cooperation from all, development for all).”

The PM spoke at length about the want for simultaneous Lok Sabha and assembly polls. He stated there has been a want for multiplied debate on the difficulty. “This cannot be the time table of 1 political birthday party or person. It isn’t Modi’s or BJP’s agenda only. there is a need for discussion in this,” he stated.

Modi stated the united states of america ultimate inside the perennial election mode no longer simplest affected governance, however also hurt the federal structure of the united states of america.

speaking about how elections lead to battle of phrases among political rivals, Modi likened elections to the pageant of Holi. Holi, he said, turned into celebrated on a specific day in which it changed into proper to throw hues or dust on people. “further, the Lok Sabha and assembly elections ought to take vicinity at a fixed time, for example in the second week of February.”

FY19 growth at 7.1%, Budget unlikely to be populist: India Ratings

With global crude prices firming up, it expects retail, wholesale inflation to come in at 4.6% and 4.4%, respectively in 2018-19

India Ratings and Research on Thursday projected the country's economic growth to improve to 7.1 per cent next financial year from 6.5 per cent this year, buoyed by robust consumer demand and low commodity prices.

In its outlook for 2018-19, the agency said there will be a gradual pick up in growth momentum owing to structural reforms like GST and Insolvency and Bankruptcy Code (IBC) in place.

"While the implementation of GST is likely to benefit the economy over the medium to long-term, the same cannot be said about the impact of demonetisation," India Ratings & Research (Ind-Ra), a subsidiary of Fitch Ratings, said.

Ind-Ra expects gross domestic product (GDP) to grow 7.1 per cent year-on-year in 2018-19, it said.

The projection is a tad lower than 7.4 per cent growth estimated by Asian Development Bank (ADB) and International Monetary Fund (IMF) for next financial year.

Ind-Ra said but for demonetisation and goods and services tax (GST) implementation, growth would not have decelerated to 7.1 per cent in 2016-17 and 6.5 per cent in 2017-18.

With the global crude prices firming up, Ind-Ra expects retail and wholesale inflation to come in at 4.6 per cent and 4.4 per cent, respectively in 2018-19, indicating an end to the current rate cut cycle.

There is still some fuzziness with respect to the intensity and the level of its future trajectory, it said, adding that the RBI "will remain in a pause mode for an extended period of time".

The agency said it expects fiscal deficit in 2017-18 to come in at 3.5 per cent, overshooting the budgeted estimate of 3.2 per cent.

"Despite 2018-19 being a pre-election year, Ind-Ra does not expect the Union Budget 2018 to be a populist budget. However, it expects some expenditure reallocation with an increased focus on the rural and agriculture sectors," it said.

The agency expects fiscal deficit in 2018-19 to be at 3.2 per cent, higher than 3 per cent stated in the medium-term fiscal policy statement.

A mix of global and domestic factors will keep the Indian rupee range bound at average Rs 66.06/$ in 2018-19, it said.