The Union Budget 2018 is a day dreaming budget. The proposed various schemes for the welfare of poor and needy is nothing new – in the past too such schemes were announced but how far they are converted into a realty is a big question mark. Time will only tell the truth. At this moment it is not a wise step to rely on it – because of poor administration – the benefit is mostly not reached to the expected/ announced levels to the persons it is aimed at, as there is no mechanism to control its implementation since accountability and responsibility is never assigned in stricter sense with penalty clauses etc for its failure on the part of persons behind it.
Any economy grows on investments and savings by citizens -especially the power of such schemes lies with tax payers and nothing is provided in this budget for such tax saving schemes.
The proposed Standard deduction of Rs 40000 is an eye wash as there is no benefit of tax saving since transport allowance and reimbursement of medial expenditure is withdrawn and the Cess is increased by 1 pc, thus whatever little tax is saved that shall be offset by inflationary trend, which this budget has failed to control inflation in toto. The levy /increase in custom duty on almost all necessary /daily life items would increase their cost.
It is suggested to abolish Cess -merge it with basic tax rates for simplification.
Petrol cut of Rs 2 in excise is taken over but Cess levied on it. It seems for government petrol is only a major source of revenue from taxes.
Tax slabs are not changed. It would be better is there had been no change at all from last year -that would have kept happier the middleclass and all salaried tax payers. The levy of ten per cent tax on Long Term Capital Gain on dividend income of more than Rs one lakh can affect share market badly.
The coercive attitude and administration of tax department has resulted in an increase of good number of new tax payers. Friendlier attitude towards tax payers especially senior citizens is most important since a good number of senior citizens having below taxable limits of income- as they are retired now -stopped filing their tax returns but continue to get queries / letters etc as to their tax matters through electronic mode, which they are just not aware of this technique.
There will be automatic revision of emoluments of Parliamentarians every five years indexed to inflation. This kind of benefit should be extending it to all employees of public and private sector with an exemption of mall ones like having turnover of say Rs ten crores. GST desired changes are nowhere seen in this budget.
For simplification abolish MAT in toto.
