Here are the highlights of the budget:
FISCAL DEFICIT
· Vows to keep fiscal deficit target of 4.1 per
cent of GDP for 2014/15
· Fiscal deficit forecast to fall to 3.6 per cent
of GDP in 2015/16, 3 per cent of GDP in 2016/17
· Finance Minister says: "We cannot spend
beyond our means"
· Tax-to-GDP ratio must be raised, says: Jaitley
GROWTH
· GDP growth in 2014/15 estimated at 5.4-5.9 per
cent year-on-year
· Aims for sustained growth of 7-8 per cent in the
next 3-4 years
· Nominal GDP growth in 2014/15 expected to be
13.4 per cent year-on-year
· Must usher in policies for higher growth,
lower inflation
POLICY REFORMS
· Raises limit on foreign direct investment in
defence sector to 49 per cent from 26 per cent
· Raises FDI limit in insurance sector
to 49 per cent from 26 per cent
· Pledges to provide necessary tax changes to
introduce real estate investment trusts and infrastructure investment trusts
TAXATION
· Jaitley vows to maintain a stable tax
environment but stops short of scrapping rules on retrospective tax
· All pending cases of retrospective tax for
direct transfers to be examined by committee before action is taken
· Retains tax collection targets and makes no
major changes to direct tax rates
· Government will not ordinarily bring any change
retrospectively that creates a new liability
· Aims to approve goods and services
tax by end of this year
· Extends 5 per cent withholding tax on corporate
bonds until June 30 2017
· Extends 10-year tax holiday for power generation
companies
· Imposes 10 per cent customs duty on some telecom
products
· Introduces uniform customs duty on all types of
coals
· Raises export tax on bauxite to 20 per cent from
10 per cent
· Raises income tax exemption limits for
individuals
REVENUES
· Revenue deficit seen at 2.9 per cent of GDP in
2014/15
· Capital receipts forecast to total Rs 739.5
billion in 2014/15
· Targets Rs 634.25 billion from total stake sales
of companies in 2014/15; Rs 150 billion from stake sales of non-government
companies
EXPENDITURE
· Total expenditure forecast at Rs 17.95 trillion
in 2014/15
· To provide Rs 134.5 billion capital infusion to
state-run banks in 2014/15
· Allocates Rs 2.29 trillion for defence spending
in 2014/15; capital outlay raised by Rs 50 billion over interim budget
· Earmarks Rs 70.6 billion to create 100
"smart cities"
· Proposes Rs 50 billion for warehousing capacity
· Plans Rs 100 billion of private capital for
start-up companies
· Proposes Rs 378 billion of investment in
national and state highways
· Rs 40 billion for affordable
housing planned through national housing bank; Rs 80 billion proposed for
rural housing scheme
BORROWING
· Net market borrowing forecast at Rs 4.6 trillion
in 2014/15
· Gross market borrowing forecast at Rs 6 trillion
in 2014/15 versus Rs 5.97 trillion in interim budget
· Forecasts interest payments and debt servicing
will total Rs 4.27 trillion in 2014/15
SUBSIDIES
· Plans to make food and petroleum subsidies
better targeted
· Rural job-guarantee scheme, which provides 100
days of paid employment a year, will become more focused on asset creation
· Food subsidy bill estimated at Rs 1.15 trillion
for 2014/15
· Petroleum subsidy bill seen at Rs 634.27 billion
for 2014/15
· Fertiliser subsidy bill forecast at Rs 729.7
billion for 2014/15
AGRICULTURE
· Will focus on acheiving 4 per cent growth per
year in agriculture
· Sets farm credit target at Rs 8 trillion for
2014/15
· Proposes a long-term rural credit fund with an
initial corpus of Rs 50 billion
Source: http://articles.economictimes.indiatimes.com
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