1. CMA Pradnya Chandorkar CY & ASSOCIATES Cost Accountants
BUDGET ANALYSIS 2017 – 18
CMA Pradnya Chandorkar
CY & ASSOCIATES
Cost Accountants
PRADNYA CHANDORKAR CY &ASSOCIATES

2. PRADNYA CHANDORKAR CY &ASSOCIATES

3. 1 Major reforms: Budget 2017-18
The presentation of the Budget has been advanced to 1st February to enable the Parliament to avoid a Vote on Account and pass a single Appropriation Bill for , before the close of the current financial year, which would enable the Ministries and Departments to operationalise all schemes and projects, including the new schemes, right from the commencement of the next financial year.
PRADNYA CHANDORKAR CY &ASSOCIATES

4. 2 Major reforms: Budget 2017-18
Discontinuing the colonial practice prevalent since 1924, Railways Budget has been merged with the Union Budget.
PRADNYA CHANDORKAR CY &ASSOCIATES

5. 3 Major reforms: Budget 2017-18
Finance Minister, in his Budget Speech of was the removal of the Plan and Non-Plan distinction in the budget expenditure. This has been implemented from the Budget of With the removal of this distinction it is expected that the link between spending and outcomes will improve and become more holistic and focused.
PRADNYA CHANDORKAR CY &ASSOCIATES

6. Background Of the Budget
Passage of the Constitution Amendment Bill for GST
Demonetisation
Uttar Pradesh, Uttarakhand, Goa, Punjab and Manipur are the states where elections will be held between February and March 2017.
PRADNYA CHANDORKAR CY &ASSOCIATES

7. PRADNYA CHANDORKAR CY &ASSOCIATES
Demonetisation- Why??
No. of persons engaged in oraganised sector
4.2 Cr
Return filed by employee under head Salary
1.74
PRADNYA CHANDORKAR CY &ASSOCIATES

8. PRADNYA CHANDORKAR CY &ASSOCIATES
Demonetisation- Why??
Informal Sector Individual Enterprises
5.6 Cr
Return filed by under this category
1.81
PRADNYA CHANDORKAR CY &ASSOCIATES

9. PRADNYA CHANDORKAR CY &ASSOCIATES
Demonetisation- Why??
No. of Companies Registered under Companies Act
(Up to )
13.94
Lacs
Companies which has filed return
5.97
PRADNYA CHANDORKAR CY &ASSOCIATES

10. Companies which has filed Return
Out of which 2.76 Lacs Co. have shown losses or zero Income
2.85 lacs companies have shown profit before tax of less than Rs 1Cr .
28,667 Companies have shown profit below 10 Cr.
7781 have profit before tax above 10 Cr.
PRADNYA CHANDORKAR CY &ASSOCIATES

11. Facts 1.25 Cr. 2 Cr. No. of Individuals who flew Abroad for Tourism
No. of Cars sold in last 5 Years
2 Cr.
No. of Individuals who flew Abroad for Tourism
PRADNYA CHANDORKAR CY &ASSOCIATES

12. Old Currency deposited during 8th November to 30th Dec 2016
Deposits
No. of Accounts
Avg. Deposit
Between Rs.2 Lacs & Rs80 Lacs
1.09 Cr.
5.03 Lacs
More than 80 Lacs
1.48 Lacs
3.31 Cr.
PRADNYA CHANDORKAR CY &ASSOCIATES

13. PRADNYA CHANDORKAR CY &ASSOCIATES
Post Demonetisation
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14. PRADNYA CHANDORKAR CY &ASSOCIATES

15. PRADNYA CHANDORKAR CY &ASSOCIATES
Budget Highlights
Realistic, High on substance
It has created positivity in the market
Maintaining fiscal discipline
The government implemented what it promised and has reached the expectations of the families, businesses and financial institutions.
PRADNYA CHANDORKAR CY &ASSOCIATES

16. PRADNYA CHANDORKAR CY &ASSOCIATES
Budget Highlights
Country a tax complaint one through tax administration
Digital economy, which will bring more transparency and reduce the shadow economy.
Stringent measures towards cash transaction limits and political funding,
Theme “effective governance”.
PRADNYA CHANDORKAR CY &ASSOCIATES

17. PRADNYA CHANDORKAR CY &ASSOCIATES
Direct Tax Collection
Year
Tax Revenue In Lacs Cr.
Growth in %
11.38
12.45
9.4
14.58 17
17.04
PRADNYA CHANDORKAR CY &ASSOCIATES

18. Key Indicators of an Indian Economy
India is now 6th largest Manufacturing country in the world, up from the 9th rank earlier.
FDI increases by 36% despite global dip in FDI inflow by 5%.
Fiscal deficit pegged at 3.2% of GDP. Remain committed to achieve 3% in following year
PRADNYA CHANDORKAR CY &ASSOCIATES

19. Key Indicators of an Indian Economy
India’s Current Account Deficit declined from about 1% of GDP last year to 0.3% of GDP in the first half of
CPI inflation declined from 6% in July 2016 to 3.4% in December, 2016 and is expected to remain within RBI’s mandated range of 2% to 6%.
PRADNYA CHANDORKAR CY &ASSOCIATES

20. Growth of India against World
World GDP
3.1%
3.4% IMF Estimates
Advanced Economies
1.6%
1.9%
Emerging Economies
4.5%
4.1%
Indian GDP
7.2% & 7.8% ( )
Current Account Deficit 1%
0.3%
FDI
Rs 1,07,000 Cr (1stHalf) Rs 1,45,000 Cr (1stHalf)
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21. PRADNYA CHANDORKAR CY &ASSOCIATES
TEC INDIA : Transform
Transform the quality of governance and quality of life of our people;
PRADNYA CHANDORKAR CY &ASSOCIATES

22. PRADNYA CHANDORKAR CY &ASSOCIATES
TEC INDIA : Energize
Energize various sections of society, especially the youth and the vulnerable, and enable them to unleash their true potential.
PRADNYA CHANDORKAR CY &ASSOCIATES

23. PRADNYA CHANDORKAR CY &ASSOCIATES
TEC INDIA : Clean
Clean the Country from the evils of corruption, black money and
non-transparent political funding.
PRADNYA CHANDORKAR CY &ASSOCIATES

24. PRADNYA CHANDORKAR CY &ASSOCIATES
TEC INDIA
All these measures are expected to provide the much needed boost to rural job creation and urban spending, which was running low on energy post demonetisation.
Tax transparency and better compliance.
PRADNYA CHANDORKAR CY &ASSOCIATES

25. PRADNYA CHANDORKAR CY &ASSOCIATES
Focus Of Budget
Agriculture
Job Creation
Infrastructure
Housing for All
Healthcare
Sanitation and other public services
PRADNYA CHANDORKAR CY &ASSOCIATES

26. PRADNYA CHANDORKAR CY &ASSOCIATES
Agriculture
There is a clear focus on achieving the aspiration of doubling farm income by 2022 with due emphasis on both productivity as well as better farm realisations.
10 Lakh Crore have been fixed  as target for Agricultural credit to farmers
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27. PRADNYA CHANDORKAR CY &ASSOCIATES
Agriculture
NAM –Electronic National Agricultural market to be expanded to over 500 markets next fiscal & Assistance of Rs. 75 Lacs for cleaning, grading and packaging
The total allocation towards agriculture & farmer welfare was increased 16% YoY
PRADNYA CHANDORKAR CY &ASSOCIATES

28. Mahatma Gandhi National Rural Employment Guarantee Act
Allocation of Rs 48,000Cr. MNREGA in Highest ever. Increased from Rs 40,000 Cr.
Participation of women in MGNREGA up to 55%
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29. PRADNYA CHANDORKAR CY &ASSOCIATES
Roads & Houses
PMGSY roads work accelerated to 133 km roads/day in as against 73 km/day between
Infrastructure Sector will get allocation of Rs Lakh Cr highest till date
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30. PRADNYA CHANDORKAR CY &ASSOCIATES
Roads & Houses
One crore houses to be built for houseless by Allocation for this has gone to 23,000 Crore
Affordable Housing carpet area of 30 sq mt will now apply in semi urban and rural area, metros and periphery of metro 50 sq mt
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31. PRADNYA CHANDORKAR CY &ASSOCIATES
Education For Youth
Two new All India Institute of Medical Sciences (AIIMS) were also announced in the states of Jharkhand and Gujarat.
350 online courses have been created under ‘Swayam’ plan for skill strengthening of Youth
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32. PRADNYA CHANDORKAR CY &ASSOCIATES
Education For Youth
100 India International Skill Centres to be launched across the country
Propose to launch skill knowledge awareness at Rs crore to provide market training to youth
PRADNYA CHANDORKAR CY &ASSOCIATES

33. Reaction of Anant Maheshwari, president, Microsoft India
As India strengthens its position on the global map, the need for skilled youth is crucial. The budget’s focus on extending market relevant training for the youth and setting up 100 international skill centers across the country, is a positive move.
PRADNYA CHANDORKAR CY &ASSOCIATES

34. PRADNYA CHANDORKAR CY &ASSOCIATES
Education For Youth
To set up National Testing agency who will conduct all exams for higher education so that CBSE can focus on academics
Additional 5000 post graduate medical seats annually will be created
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35. PRADNYA CHANDORKAR CY &ASSOCIATES
Education For Youth
Pradhan Mantri Kaushal Kendras-600 districts
SANKALP will provide market relevant training to 3.5 crore youth –4000 Cr allocations
Skill Strengthening for Industrial Value Enhancement (STRIVE) –Rs. 2,200 crores.
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36. PRADNYA CHANDORKAR CY &ASSOCIATES
Govt. Plans
Govt. will list IRCTC, IRFC and IRCON on stock exchange to increase public accountability and unlock value of these PSUs
Pradhan Mantri Mudra Yojana lending target to be doubled to Rs 2.44 lakh crore
PRADNYA CHANDORKAR CY &ASSOCIATES

37. Welfare for Children & Women
Allocation for welfare of women and children stepped up from Rs 1.5 lakh crore to Rs 1.84 lakh crore
Rs. 6,000 each will be transferred directly to the bank accounts of pregnant women
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38. PRADNYA CHANDORKAR CY &ASSOCIATES
Senior Citizen
Aadhar based smart cards with health details for senior citizens in
Senior citizen to get  8% p.a. assured income in pension schemes
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39. PRADNYA CHANDORKAR CY &ASSOCIATES
Railway
Merger of Railway budget with general budget is a historic step
By 2019, All Indian Railway coaches will be fitted with Bio-Toilets
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40. PRADNYA CHANDORKAR CY &ASSOCIATES
Railway
Cashless Railway Bookings have moved up to 68%
Rail safety fund of Rs 1 lakh crore to be created for 5 years.
SMS based “Clean my coach” service has been started.
Service charges on rail tickets booked through IRCTC to be withdrawn
PRADNYA CHANDORKAR CY &ASSOCIATES

41. Reaction :Railway minister Suresh Prabhu
Describing the budget as growth oriented, he said, “The growth will happen because of huge investments that is happening. In railways, the provision for Rs1.31 lakh crore for capital expenditure is unprecedented in railway history.”
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42. PRADNYA CHANDORKAR CY &ASSOCIATES
Digital India
125 Lakh users have adopted BHIM App
Referral Bonus scheme for consumers and merchant cash back scheme will be launched for BHIM App
The government proposes to create payment regulatory board with RBI
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43. PRADNYA CHANDORKAR CY &ASSOCIATES
Digital India
20 Lakhs Aadhar based ‘Point Of Sale’ systems to be setup in 2017
Post Offices will now be use as Passport Offices
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44. PRADNYA CHANDORKAR CY &ASSOCIATES
Start Ups
Profit linked deductions for startups now 3 out of 7 years (earlier, 3 out of 5 years)
That there is a world of talent out there waiting in the wings to fly with ideas is a foregone conclusion. If only the budget had something on the Angel tax, it could have done a world of good for the start-ups.
PRADNYA CHANDORKAR CY &ASSOCIATES

45. PRADNYA CHANDORKAR CY &ASSOCIATES
Indirect Taxation
Reports had indicated that the Finance Minister could hike service tax rate to per cent from the current 15 per cent.
No major changes in the excise and service tax rates ahead of the Goods and Service Tax (GST) is a welcome relief.
PRADNYA CHANDORKAR CY &ASSOCIATES

46. PRADNYA CHANDORKAR CY &ASSOCIATES
Direct Taxation
Direct tax provisions focused on widening the tax base by lowering the tax rate for the lower income segment in both individual as well as corporate (MSME).
PRADNYA CHANDORKAR CY &ASSOCIATES

47. PRADNYA CHANDORKAR CY &ASSOCIATES
Direct Taxation
Tax Reduction from 30% to 25% for companies who have less than 50 crore revenue. 96% companies will get benefit of this proposal.
MAT (Minimum Alternative Tax) carry forward to 15 years from 10 years
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48. PRADNYA CHANDORKAR CY &ASSOCIATES
Personal Income Tax
Personal Income Tax reduced for individual assesses from 2.5 Lakh to 5 lakhs to 5% – Earlier it was 10% tax for this bracket
A single one-page form for filing IT returns for taxable income up to 5 lakh rupees
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49. PRADNYA CHANDORKAR CY &ASSOCIATES
Personal Income Tax
A more gradual transition from 5% to the highest rate, avoiding sharp increases as at present, from 5% to 20 %.
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50. PRADNYA CHANDORKAR CY &ASSOCIATES
Real Estate & Housing
Capital Gain on Land & Building 36months to 24 months
More Coverage : Carpet Area instead of Built up Area
Concession for land acquirement for Capital of Andhra Pradesh
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51. PRADNYA CHANDORKAR CY &ASSOCIATES
Real Estate & Housing
Index Calculation: Base 2001 instead of 1981
No Notional Income on unsold flats for one year
More options for investments in long term bonds for Capital Gain
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52. PRADNYA CHANDORKAR CY &ASSOCIATES
Budget Reforms
A political party cannot accept more than Rs. 2000 as donation in cash from any single source.
Restricting cash donations : Rs. 2000
Discourage Cash Transactions: Rs.20K to Rs.10K
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53. PRADNYA CHANDORKAR CY &ASSOCIATES
Budget Reforms
Tax Concession for dealers under Presumptive Income: 8% to 6% for digital payment
Penalty on Chartered Accountants,Valuers & merchant Bankers for submitting wrong information
PRADNYA CHANDORKAR CY &ASSOCIATES

54. Disappointing feature of Budget
Absence of a credible plan to ensure a revival of bank lending.
Commercial credit expansion by banks has slowed down considerably, and if personal loans are excluded, lending to industry is actually contracting!
There is no way the economy can get back to 7.5% growth without a robust revival in bank lending.
PRADNYA CHANDORKAR CY &ASSOCIATES

55. Disappointing feature of Budget
The government wants to create an eco-system to make India a global hub for electronics manufacturing - a tall aspiration. However, the budget does make an attempt towards the right direction
PRADNYA CHANDORKAR CY &ASSOCIATES

56. PRADNYA CHANDORKAR CY &ASSOCIATES
To Summarise
Budget reflects Government’s firm commitment to substantially boost investment in Agriculture, Social Sector, Infrastructure and Employment Generation on the one hand and simultaneously sticking to the fiscal consolidation path on the other hand.
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57. PRADNYA CHANDORKAR CY &ASSOCIATES
To Summarise
Government has marginally deviated from its fiscal path, emphasis has clearly been laid on growth by focusing more on capital expenditure.
We gave a new life to young. In spite of these successes, the best is yet to come. With a strong economy, our country can decide its own future.
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58. PRADNYA CHANDORKAR CY &ASSOCIATES
HONOURING THE HONEST
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59. PRADNYA CHANDORKAR CY &ASSOCIATES
Cost Accountants /
PRADNYA CHANDORKAR CY &ASSOCIATES