On-the-Spot Budget Analysis with Knowledge Partner Ernst & Young
The live viewing and interactive session on budget 2018 was organized by AMCHAM’s Eastern Region, in association with EY as the knowledge partner, on 1st February 2018 at the EY Kolkata office. The session started with inaugural remarks on the expected budget proposals given by Mr. Dinesh Agarwal, Partner, Tax & Regulatory Services, EY, followed by live viewing of the budget 2018 speech delivered by Hon’ble Finance Minister, Mr. Arun Jaitley.
Post the live viewing of the speech, opening remarks on the budget proposals were given by Mr. K.P. Sengupta on the impact of budget proposals on the economy from a macro perspective. The same was then followed by a debriefing from Mr. Dinesh Agarwal and other representatives from EY on various tax proposals.
Mr. Dinesh Agarwal said it is a well packaged budget, managing expectations from most quarters. Budget proposals announced by the Finance Minister largely deliver on the populist agenda with continued focus on agriculture, poor, healthcare, women, infrastructure, social security, and governance. Mr. Dinesh Agarwal also highlighted the following inter-alia key announcements:
- Reduction in corporate tax rate on all companies with turnover of up to INR 250 crores is in line with the promise made in 2015 and the revenue forgone through the proposed reduction seems to be offset by introduction of long tax capital gain tax @ 10% from sale of listed securities without giving effect of indexation (if such income is more than INR 100,000 and subject to grandfathering provisions) and increase in the education cess from existing 3% to health and education cess of 4%
- Standard deduction (INR 40,000 per annum) in lieu of medical expense reimbursement (INR 15,000 per annum) and transport allowance (INR 19,200 per annum) for salary income earners has been reintroduced offering a net benefit of INR 5,800 to salaried tax payers
- The government has also brought cheer to the senior citizens by enhanced medical insurance premium deduction from existing INR 30,000 to INR 50,000, increase in expense deduction for critical care illness from existing limit of INR 60,000 to INR 100,000 for senior citizens and from existing limit of INR 80,000 to INR 100,000 for super senior citizens as well as increasing deduction for tax free interest income from all types of bank accounts from existing INR 10,000 to INR 50,000
- Roll out of e-assessment across the country by notifying a new scheme of assessment through electronic mode is in lines with the government vision of Digital India and would also eliminate person to person contact between the tax official and tax payer which would bring about transparency in the system
The interactive session was concluded with a vote of thanks to participants from Mr. Dinesh Agarwal.