Jaitley bowls a tight line but serves a few dollies too



Finance minister Arun Jaitley arrives to present Budget at Parliament House. Photo: R.V. Moorthy

Arun Jaitley and Minister of State for Finance Jayant Sinha with Finance Ministry staff, at their North Block office before leaving for Rashtrapati Bhavan, ahead of the Union Budget 2015. Photo: Sandeep Saxena

In this TV grab Finance Minister Arun Jaitely arrives at the North Block in New Delhi on Saturday ahead of the Budget presentation in Parliament on Saturday. Photo: PV Sivakumar

Union Finance Minister Arun Jaitley

Corporate tax rate to be cut from 30% to 25% over 4 years, GAAR deferred for 2 years. No change for individuals.

Synopsis: Finance Minister Arun Jaitley on Saturday presented an <a href="https://www.thehindubusinessline.com/economy/budget/budget-coverage/jaitley-goes-tough-on-tax-evaders-attempts-to-woo-investors/article6944882.ece">‘intellectually honest’ Budget </a>that seeks to address the concerns of domestic tax prayers, while signalling the intent to go tough on those who have stashed black money abroad. The Budget is replete with several measures that would go to improve social security in India and make the country a pensioned society from the current pension less society. <br /> Viewpoint: <a href="https://www.thehindubusinessline.com/economy/budget/india-inc-jaitley-takes-away-more-than-he-gives/article6945359.ece">Jaitley takes away more than he gives </a><br /> <b>Markets at close</b><br /> Modi government’s first full-fledged budget triggered huge volatility in stock markets today with the benchmark Sensex finally ending 141.38 points higher on promise of lower corporate tax rates — logging the the first rise on a Budget day in four years. <br /> The Sensex, which was trading with a gain of over 200 points before Finance Minister Arun Jaitley began his much-awaited Budget speech, swung between positive and negative terrain as he announced different measures. Soon after the Budget speech ended, the bluechip index fell to the day’s lowest point of 28,882.02 — down 338 points. However, markets recovered from the lows and rose steadily in the last two hours of trading to end at 29,361.50 — a net rise of 141.38 points or 0.48 per cent. Intra-day, it swung a massive 678 points. Yesterday, Sensex had gained 473 points after the Economic Survey. <br /> In the previous three sessions on Budget 2014, 2013 and 2012, the Sensex had ended down.<br /> The NSE Nifty also moved up by 57.25 points to close at 8,901.85, after hovering between 8,751.35 and 8941.10.<br /> <b>Union Budget 2015 as it was presented in Parliament on February 28, 2015 (Latest first): </b><br /> <b>Market news: </b><br /> Investors snub Budget 2015-16 proposals. At about 1.30 pm, the 30-share BSE index Sensex was trading lower by 204.85 points or 0.71 per cent at 29,015.27 and the 50-share NSE index Nify was trading down by 62.05 points or 0.7 per cent at 8,782.55.<br /> At mid-session, the Sensex had surged 340 points to 29,201 immediately after Jaitley's announcement to reduce the corporate tax rate gradually. <br /> <img src="https://www.thehindubusinessline.com/multimedia/dynamic/02325/ptigraph1_2325838f.jpg" class="bordered-image left-align" /><br /> <b>India Inc reaction</b><br /> Jyotsna Suri, FICCI President, and Chairperson, Bharat Hotels Ltd, said: "It is not a make or break Budget. It is a visionary Budget which lays the road map for future. Measures such as reducing corporate tax is appreciated. <br /> Jaitley concludes Budget speech with commitment to well being of all "Sarve Bhavantu Sukhinah, Sarve Santu Niramayah<br /> FM: "Even our worse critics have acknowledged that we have moved rapidly. India is a super-giant which moves slowly but surely.<br /> Direct tax proposals will lead to loss of Rs 8,315 crore; indirect proposals will yield Rs.23,383 cr<br /> <b>Tax proposals</b><br /> Negative list under service tax pruned<br /> <b>For Individuals:</b><br /> Individual tax payer will benefit to the extent Rs 4,44,200 from the exemptions announced<br /> Increase in deduction of health insurance premium from Rs 15,000 to Rs 25,000<br /> For senior citizens, the limit is Rs 30,000<br /> Very senior citizens (above 80 years) deduction of Rs 30,000 for treatment of medical treatment <br /> Limit of dedution under new pension scheme hiked to Rs 1,50,000<br /> Rs 50,000 deduction in taxable income for contribution to NPS<br /> Social safety net and pension to individuals - deduction of Rs 50,000 for contribution to new pension scheme<br /> Transport allowance exemption increased from Rs 800 to Rs 1,600/month<br /> All contributions to Sukanya Samridhi scheme to be tax free<br /> <img src="https://www.thehindubusinessline.com/multimedia/dynamic/02325/Budget_combo1_2325826f.jpg" class="bordered-image left-align" /><br /> Service tax + education cess increased to consolidiated amount of 14% <br /> Custom duty on raw materials and intermediaries to be reduced <br /> Wealth tax abolished; 2% surcharge on super rich with annual income over Rs 1 crore. Will lead to Rs 9,000 cr additionally <br /> GAAR: Defer applicability by two years<br /> Reduced taxes on technical services to 10% from 25% <br /> <b>Tackling blackmoney:</b>Govt proposes to incentivise debit-credit card transactions<br /> GAAR: Defer applicability by 2 yrs Black money eats into our economy<br /> To enact a comprehensive law on black money stashed abroad. Concealment of income wiil be prosecutable with rigourous imprisonment <br /> Black money: New structure including e-filing, tracking down is our abiding committment<br /> Benami property transaction Bill to tackle black money transaction in real estate soon<br /> Prohibit Rs 20,000 and more cash advance in case of sale of immovable property<br /> Exemption to individual will continue<br /> Mandatory to file return even if no income<br /> <b>Corporate tax rate to be cut from 30% to 25% over 4 years</b><br /> Sensex jumps 280 points immediately.<br /> Attempt in 9 months to foster stable taxation policy<br /> Need to revive growth and onvt to ensure more jobs for youth<br /> GST from next year<br /> GST is expected to play trans-formative role by creating a common market ;have already introduced Bill for same. This will lead to higher level of growth, accompanied by elimination of exemptions, which lead to disputes <br /> <b>Budget estimates</b><br /> Budget Estimates of Expenditure: Rs 17 .77 lakh cr, of which Non Plan is Rs 13.12 lakh cr, and Plan is Rs 4.65 lakh crores<br /> Direct Tax collection is going to be Rs 14.49 lakh crore <br /> Defense Budget enhanced to Rs 2,46,727 crore.<br /> Fiscal deficit of 3.9 % targeted for current financial year <br /> <b>12 pm </b><br /> Special assistance to Bihar and West Bengal<br /> "Renewable energy target will be increased to 1,75,000 MW." <br /> We are pursuing policy of Make In India in Defence not only to cater our needs but also for export <br /> <b>Educational institutes</b><br /> ISM Dhanabad will be upgraded to full IIT <br /> AIIMS to be set up in J&amp;K, Punjab, Tamil Nadu, Himachal Pradesh and Assam. <br /> IIT in Karnataka and IIM in J&amp; K and Andhra Pradesh . <br /> Easy Loans to Students.<br /> Institute of Science and Education in Nagaland<br /> Apprentice training institute for women in Haryana and Uttarakhand<br /> <blockquote class="twitter-tweet" lang="en"><p>Check all updates related to <a href="https://twitter.com/hashtag/UnionBudget2015?src=hash">#UnionBudget2015</a> on I&amp;B MInistry&#39;s special Webpage: <a href="http://t.co/5DrySkB3Ia">http://t.co/5DrySkB3Ia</a>&#10;<a href="https://twitter.com/hashtag/SabkaBudget?src=hash">#SabkaBudget</a> <a href="http://t.co/gYvJgtpPOp">pic.twitter.com/gYvJgtpPOp</a></p>— MIB India (@MIB_India) <a href="https://twitter.com/MIB_India/status/571583834187161600">February 28, 2015</a></blockquote><br /> Committee to be set up to plan the celebration of the 100th birth anniversary of Deen Dayal Upadhyaya<br /> Public procurement law to be introduced <br /> Visa-on-arrival increased to 150 countries in various stages<br /> Announces 10 nominations for Heritage Sites. Says India is world cultural site but has less amenities and facilities. Propose to start working on this and develop these sites. The sites include Churches of old Goa, Hampi, Elephanta Caves, Rajasthan Leh Palace and Varanasi temple town<br /> Measures to make india a cashless society<br /> Rs 1,000 crore to Nirbhaya fund<br /> National Skill Mission to be launched, to develop employability of youth, especially below 25 years of age<br /> <b>Unlocking household gold</b><br /> To introduce gold monetisation scheme<br /> Indian Gold Coin with Ashok Chakra announced<br /> Soveriegn gold bond an alternative way to p[urchase gold<br /> Redeemable with cash at face value<br /> <b>Financial markets</b><br /> Section 6 of FEMA to be amended<br /> Internationally competitive Direct Tax regime to be put in place<br /> FMC to be strengthened by merging with SEBI. <br /> Govt. to do away with distinctions between FII and FDI and replace it with Composite Caps. <br /> Deepening of bond market to complement our world class equity; Public Debt Management agency towards this end<br /> Employees contribution to the EPF should be optional.<br /> Employee may choose from EPF or New Pension scheme<br /> Govt plans an expert committee for Drafting Legislation for Regulatory mechanism <br /> <b>Infrastructure</b><br /> We have to aim to making India manufacturing hub. Make in India programme is aimed at raising share of manufacturing in GDP and creating jobs<br /> 5 Ultra Mega Power Projects through transparent auction system of 4000 MW announced<br /> Expert committee to examine need for multiple prior clearances for projects<br /> Highest ever allocation for MGNREGA, by increasing it this year by Rs 5,000 crore <br /> Public investment of Rs 1.25 lakh crore over the and above the revised budgetary target <br /> Investment in infra go up by Rs 70,000 cr in 15-16 from Centre and resources<br /> Announces Atal Innovation Mission with initial fund of Rs.150 crore for Research and Development.<br /> Self employment and talent utilisation - to promote startups and self employment. specially in tech sector. Rs 1000 cr alloted<br /> Port in Public sector will be encouraged to become companies under Companies Act<br /> Aim towards ease of doing business<br /> PPP model of Infrastructure to be revitalized and realigned.<br /> Announces National Investment &amp; Infrastructure fund <br /> Tax-free infra bond for Rail, Roads<br /> Increased Budgetary allocation to Roads &amp; Railways <br /> <b>Social security schemes</b><br /> Nayi Manzil scheme- for minority youth who do not have proper school leaving certificate<br /> A new scheme for Minority Youth <br /> Physical aids and asistance living devices for snr citizens livong under poverty line<br /> Senior citizens welfare fund to subsidise the premium for elderly people <br /> FM announces " Atal Pension Yojna". Will provide defined pension according to contribution ; 50% contribution to be from Govt<br /> Govt plans Jeevan Jyoti Beema Yojana under which Rs two lakh cover at a premium of Rs 330 per year <br /> Universal social-security system for all Indians<br /> All post offices to be included into banking so that it contributes for Jan Dhan Yojana <b>11.30 am</b><br /> Rupee has gained by 6.4 per cent against a broad base of currencies; Foreign exchange reserves at record USD 340 billion<br /> We will move to amend the RBI Act this year to form Monetary Policy Committee<br /> Bankruptcy law reform, failed; govt. to bring a comprehensive bankruptcy code for the ease of doing business by 2015-16 <br /> Govt. is committed to increase the access of people to formal financial system.<br /> Proposes a Mudra Bank of corpus of Rs 20,000 crore to refinance the MFIs . Will fund the unfunded. <br /> Creation of national agri market needed to increase income of farmer, to give them fair price<br /> Electronic receivable discounting system for MSMEs<br /> <b>11.23 am</b><br /> Tax buoyancy is lower but still we will meet the promise of Fiscal deficit of 4.1% of GDP this year. <br /> LPG direct transfer subsidy to be expanded<br /> We need a well targeted system of subsidies rather than to cut subsidies <br /> Soil health card issued to improve soil health<br /> Rs 5,300 cr support for micro irrigation schemes <br /> Rs 25,000 cr to rural develpoment fund NABARD<br /> Rs 15,000 cr for short term RRB refinance fund<br /> Agri credit target in 2015-16 increased to Rs 8.5 lakh crore.<br /> Roadmap to achieve fiscal deficit of 3% of GDP in three years: Target is 3.9% in 2015-16, 3.5% in 2016-17, 3% in 2017-18.<br /> <b>Bank Nifty on a roll</b><br /> Bank stocks are on a roll with the CNX Bank Nifty up by about 230 points just as the Finance Minister Arun Jaitley began his Budget presentation this morning. The CNX Bank Nifty had gained 229.95 points and all 12 stocks making the Bank Nifty index were trading in the green. <br /> Will finish the journey to 3% fiscal deficit in two years<br /> Govt is still firm on achieving fiscal deficit target of 3 % of GDP eventually<br /> Real GDP expected to accelerate to 7.4% <br /> <b>11.20 am</b><br /> Turn our youth from job seekers to job creators<br /> Agri incomes under stress.<br /> Manufacturing has declined <br /> Manufacturing exports 10% of GDP<br /> 42% share of divisible pool of taxes to states<br /> Rs 5.28 lakh cr to states in 15-16<br /> 62% of total reciepts of country given to states<br /> 1 lakh km of road currenctly under construction; another 1 lakh proposed<br /> 80,000 senior secondary schools... ensure a school near 5 km of every child<br /> To ensure employment to our youth, we have to make India the manufacturing hub of the world<br /> In terms of communication, Rural-Urban divide is no longer acceptable<br /> <b>11.13 am</b><br /> Housing for all by 2020 <br /> A roof for each family in India by 2022- 75th Year of India's Independence<br /> Double digit growth seems feasible<br /> All our schemes have to centre around the poor<br /> Incremental change is not going to take us anywhere, will need to think in terms of quantum jump<br /> <b>11.06 am</b><br /> GST will put in place state of art indirect tax system by April 1, 2016<br /> Estimated GDP 7.4% for 2014-15; 8-8.5% in 15-16<br /> Our achievement is to conquer inflation; will be only 5% by end of year<br /> JAM Trinity- Jan Dhan Adhaar Mobile &amp; GST - Two Game Changing Reforms<br /> In Swachh Bharat 50 lakh toilets already built, 6 crore toilet targeted <br /> Three achievements of Govt.- Success of JanDhanYojana, Coal Auctions &amp; Swachh Bharat<br /> India set to be the fastest growing large economy in the world...<br /> This opportunity has risen because we created it. People have voted for quick change, faster growth. They wanted a Govt. they can trust<br /> The people of India have voted for quick change, faster growth and higher standards of transparency<br /> We inherited a sentiment of doom and gloom and have come a long way by pour actions <br /> <b>11.06 am</b><br /> In Nov 2012 CPI 12.2%<br /> CPI Inflation now 5.1%<br /> WPI negative<br /> CAD below 1.3% GDP<br /> 7.4% GDP growth<br /> Foreign exchange $55 bn <br /> Says India's is second best stock market<br /> Objective is to improve quality of life and to pass benefits to common man.<br /> We are round the clock, round the year Government<br /> In last 9 months, the NDA govt has taken several steps to energise the economy<br /> World is predicting It is India's chance to fly<br /> States have been empowered financially<br /> Says "Economic Environment far more positive"<br /> <b>11.00 am</b><br /> Finance Minister Arun Jaitley begins Budget 2015 speech in Lok Sabha<br /> <b>10.50 am</b><br /> Markets just ahead of the Budget presentation<br /> The Sensex was up 199.04 or 0.68 per cent at 24,419.16 while the NSE Nifty was up 57.10 points or 0.65 per cent at 8,901.70. <br /> Union Budget 2015 papers arrive at Parliament House. Photo: Kamal Narang<br /> <img src="https://www.thehindubusinessline.com/multimedia/dynamic/02325/budgetpapers_2325692d.jpg" class="bordered-image left-align" /><br /> <blockquote class="twitter-tweet" lang="en"><p>Visuals: <a href="https://twitter.com/FinMinIndia">@FinMinIndia</a> Minister Shri <a href="https://twitter.com/arunjaitley">@arunjaitley</a> leaving for Parliament to present <a href="https://twitter.com/hashtag/Budget2015?src=hash">#Budget2015</a>: <a href="http://t.co/9eIFX8O7vH">http://t.co/9eIFX8O7vH</a> <a href="https://twitter.com/hashtag/SabkaBudget?src=hash">#SabkaBudget</a></p>— MIB India (@MIB_India) <a href="https://twitter.com/MIB_India/status/571538435527200768">February 28, 2015</a></blockquote><br /> <b>10.25 am</b><br /> The Budget speech and the document has two parts – Part A and B. Part A is the macroeconomic part of the budget where various schemes are announced, and allocations are made to several sectors. The priorities of the government are also announced in this part.<br /> <blockquote class="twitter-tweet" lang="en"><p>Union Budget FAQs: How is budget prepared?&#10;<a href="https://twitter.com/hashtag/%E0%A4%AC%E0%A4%9C%E0%A4%9F2015?src=hash">#बजट2015</a>&#10;<a href="https://twitter.com/hashtag/Budget2015?src=hash">#Budget2015</a> <a href="http://t.co/WqYDO0bANe">pic.twitter.com/WqYDO0bANe</a></p>— MIB India (@MIB_India) <a href="https://twitter.com/MIB_India/status/571531567279030273">February 28, 2015</a></blockquote><br /> <b>Reforms, the watchword:</b> Priority should be on reviving the investment cycle, driven by increased public spending, say analysts. <a href="https://www.thehindubusinessline.com/markets/stock-markets/budget-should-spell-out-reform-measures-analysts/article6941890.ece">Read more</a><br /> <blockquote class="twitter-tweet" lang="en"><p>FM, MoS &amp; officers briefed <a href="https://twitter.com/hashtag/PresidentMukherjee?src=hash">#PresidentMukherjee</a> on main features of Union Budget at Rashtrapati Bhavan this morning. <a href="http://t.co/RuyGQpGlx0">pic.twitter.com/RuyGQpGlx0</a></p>— President of India (@RashtrapatiBhvn) <a href="https://twitter.com/RashtrapatiBhvn/status/571536442205200384">February 28, 2015</a></blockquote><br /> <b>10.00 am</b><br /> <b>Infra stocks rally</b><br /> With a huge expectation on the first full Budget of the Narendra Modi-led Government triggering a next growth phase for infrastructure, the infrastructure stocks extended gains today. <br /> The stock of GMR Infrastructure was up by about 3.5% at Rs 20.30. GVK Power &amp; Infrastructure’s scrip rose 1.86 per cent to Rs 10.40, Lanco Infratech 6.10 per cent to ₹7.13, NCC 2.48 per cent to ₹78.40, and L&amp;T 2.3 per cent to ₹1,799.<br /> Ramky Infra was up 2.96% at Rs 48.65, while IVRCL rose 2.69 per cent to ₹19.10.<br /> Many infrastructure stocks on Friday rallied on optimism that the Centre is committed to shore up the sector’s prospects and present an industry-friendly Budget.<br /> <b>9.50 am</b><br /> Tax breaks for individuals? <br /> The common man or the middle class segment of the population wants the threshold limit to be increased from Rs.2.5 lakh to Rs.4 lakh. Ideally, the threshold limit increase should automatically be aligned with the inflation rate and adjusted accordingly. Household savings, as a percentage of the GDP, have seen a decline, and, hence, there is a crying need to increase limit under 80C from Rs.1.5 lakh to Rs.2.5 lakh. <br /> <b>9.40 am</b><br /> <img src="https://www.thehindubusinessline.com/multimedia/dynamic/02037/BL04_bull_jpg_2037450d.jpg" class="bordered-image left-align" /><br /> <b>Market news</b><br /> At 9.40 a.m., the 30-share BSE sensitive index Sensex was trading higher by 273.88 points or 0.94% at 29,494 and the 50-share NSE index Nifty was trading up by 72.95 points or 0.82 per cent at 8,917.55. <br /> <b>9.30 am</b><br /> <b>Call for rate cut</b><br /> The RBI should consider cutting lending rates on the back of lower inflation, Chief Economic Advisor Arvind Subramanian said on Friday. <br /> <img src="https://www.thehindubusinessline.com/multimedia/dynamic/02277/BL14_Businessmen_p_2277833d.jpg" class="bordered-image left-align" /><br /> <br /> His comments came a day ahead of the Union Budget and in the backdrop of RBI Governor Raghuram Rajan earlier saying that the central bank will wait for Budget cues before taking a decision on further easing of monetary policy.<br /> <b>Survey on fiscal deficit</b><br /> The Economic Survey has diagnosed the daunting challenge for the Centre in maintaining fiscal discipline while boosting public investments to revitalise growth. he advice from the Survey is not to go in for excessive belt-tightening, which could affect public investments and thereby hurt growth. An overhaul of the subsidy regime will be a centrepiece of the expenditure compression strategy that could help the Government achieve its medium-term fiscal deficit target of 3 per cent of GDP.<br /> <b>Market news</b><br /> The Sensex was trading 234 points higher or 0.80 per cent at 29,454.43 while the NSE Nifty jumped 57.45 points or 0.65 per cent to 8,902.05 in early trade.<br /> <b>9.15 am</b><br /> Arun Jaitley with Minister of State Jayant Sinha leaves North Block to present Union Budget in Parliament.<br /> <b>Jaitleyspeak</b><br /> As expectations continue to build up on the first full Budget of the Modi government, Jaitley had said the sum total of the reform measures and other policy initiatives already taken would be much more than "the big bang". <br /> <img src="https://www.thehindubusinessline.com/multimedia/dynamic/02325/jaitley300_2325639d.jpg" class="bordered-image left-align" /><br />"I am not going to be swayed by these phrases that are used in television studios. If you take the sum total of all the steps we have already taken, it will be much more than the big bang. Even big bang looks small in comparison." <br /> Asked if he was tempering expectations, the Minister said: "I am not tempering expectations. Opening up sacrosanct sectors like Railways, Defence, is that not big bang? GST, which everyone thought will never see the light of the day, is that not big bang?<br /> "In the mining sector, in allocation of natural resources, what we have done, is it not big bang? These are steps which our predecessors had failed to take. The Budget will be a very important occasion for this government, but then the next 364 days are equally important."<br /> <b>9.05 am</b><br /> Modi government's first full year Budget, hyped as a ‘make or break’ exercise, is widely expected to unveil sops for tax payers while pushing forward the ‘Make In India’ campaign. <a href="https://www.thehindubusinessline.com/economy/budget/budget-jaitley-may-offer-tax-breaks-for-individuals/article6922018.ece">Read more</a><br /> <b>On high alert</b><br /> SEBI and the stock exchanges are on high alert. Markets are expected to witness a huge turnover, including by foreign entities. Various market entities have also been asked to ring-fence their systems and infrastructure from any sudden volatility. The day, being a Saturday, may add to trading volumes and volatility as overseas markets, including Singapore where many foreign investors take position before trading begins in India on normal days, would be closed and the foreign investors are expected to trade directly on Indian bourses. <br /> <b>8.50 am</b><br /> Ahead of the Budget, Jaitley had hinted at more reforms for faster economic growth and rationalisation of expenditure, saying the government does not believe in living on borrowed money. "We’re trying to rationalise expenditure as far as the Government is concerned because we do not want the government to live on borrowed money indefinitely. The whole concept of spending beyond your means and leaving the next generation in debt to repay what we are overspending today is never prudent fiscal policy," he said.<br /> <b>8.45 am</b><br /> Stock markets are open today and trading will be conducted during normal hours from 9 am to 3.30 pm, despite it being a Saturday. This is probably the first time in many years that the Union Budget is being presented on a Saturday. The stock markets are generally closed on Saturdays and Sundays, except for special circumstances.<br /> <img src="https://www.thehindubusinessline.com/multimedia/dynamic/02324/eco_jpg_2324960d.jpg" class="bordered-image left-align" /><br /> <b>8.40 am</b><br /> Decisive policy shifts by the Centre that have stabilised the macro-economic situation, a declining trend in inflation, and a benign external environment make India the cynosure of investors, says the report-card on the economy for 2014-15, tabled in Parliament on Friday.<br /> <b>Reader's Poll</b> <br /> 68% of our readers say the Budget will be less populist this time. What's your opinion? Vote and comment <a href="https://www.thehindubusinessline.com/economy/budget/todays-poll/article6941459.ece">here</a><br /> <b>8.30 am</b><br /> Finance Minister Arun Jaitley is all set to present the Budget today. The Economic Survey on Friday said India has reached a sweet spot and could finally be on a double-digit medium-term growth trajectory, while projecting over 8% growth in 2015-16.<br />
Published on February 28, 2015
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