New Delhi, February 1: As Finance Minister Arun Jaitley on Thursday rolled out a Budget focused on farmers and those living in rural areas while boosting jobs and private investment, he has pegged the fiscal deficit target for next year at 3.3 per cent, higher than the 3 per cent goal set earlier. In its last full-year budget before the 2019 general elections and ahead of eight state election this year, the Narendra Modi government has made a slew of farm-focused announcements, raising the minimum support price to 1.5 times the production cost of Kharif crops, which is also one of the major demands of distressed farmers. FM Jaitley also announced government-funded healthcare plan to cover 10 crore poor families, calling it world’s largest scheme. (Also Read – Union Budget 2018: Key Takeaways From Arun Jaitley’s Fifth Budget) Also Read - Indian Armed Forces Can Strike on Terrorist Havens Anywhere, Anytime: PM Modi in Jaisalmer
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- Moments after FM Jaitley ended his budget speech, Prime Minister Narendra Modi was seen thumping his table and later congratulated him. “Today’s budget is farmer friendly, common citizen friendly, business environment-friendly and development friendly. It will add to the ease of living,” FM Jaitley said.
- In his budget speech, FM Jaitley said that the National Health Protection Scheme announced today will cover 10 crore poor and vulnerable families, or about 50 crore beneficiaries, with a cover of 5 lakh per family per year for secondary and tertiary case medical treatment. FM Jaitley also announced that eight crores free gas connection will be given to poor women.
- In income tax slabs for individuals this year, FM Jaitley has made no changes. All salaried people will get a standard deduction of Rs 40,000 on their income in lieu of medical and transport reimbursements. FM Jaitley also increased cess on personal income tax and corporation tax to 4 per cent from present 3 per cent. “Step by step, in every budget, I have been putting surplus money in the hands of the middle-class taxpayer,” FM Jaitley said to media.
- He also announced a new 10 per cent long-term capital gains tax on gains exceeding Rs 1 lakh from investment in equities and equity mutual funds.
- In a key announcement for new employees, FM Jaitley said that the government will contribute 12 per cent in the Employees’ Provident Fund for three years for new employees.
- The corporate tax rate for companies with up to a turnover of Rs 250 crore has been reduced to 25 per cent from 30 per cent, FM Jaitley announced.
- The budget speech was monitored closely for how the government balanced its need to reach out to voters ahead of eight state elections this year and the Lok Sabha election next year.
- FM Jaitley said that the Narendra Modi government has been consistently focused on fiscal prudence. The revised fiscal deficit target for this year ending March is 3.5 per cent of the GDP, he said, wider than the previous 3.2 per cent target.
- The stock markets which were up this morning, plunged into the red after FM Jaitley announced a higher fiscal deficit target for next year and the new capital gains tax. They have now recovered.