The City Standard 11th February 2019- 5th issue

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z VOL : 01 z ISSUE : 05 z Monday, FEBUARY, 11, 2019

PRAYAGRAJ

z PAGES : 12

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Budget 2019 : FM showers dole before poll

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NEW DELHI Making a big populist push in its final budget before elections, the Narendra Modi-government Friday exempted people with an earning of up to Rs.5 lakh from payment of income tax, announced an annual cash dole-out of Rs. 6,000 to small farmers and provided a monthly pension of Rs.3,000 to workers in the unorganised sector. Converting what was supposed to be an interim budget or a vote on account into an almost fullfledged budget announcement in the Lok Sabha, finance minister Piyush Goyal proposed an array of incentives for both middle-class and farmers, whose disenchantment was said to have cost the BJP dearly in recent assembly elections. Over 3 crore salaried class, pensioners, selfemployed and small businesses with total income of up to Rs.5 lakh will have to pay nil tax now against their current liability of Rs.13,000 (including health and education cess) in view of the relief Goyal provided in form of a 'rebate'. Individuals with gross income up to Rs.6.5 lakh will not need to pay any tax now, if they make tax saving investments of Rs.1.5 lakh under Section 80C of the Income Tax Act. However, very senior citizens (aged 80 years and above) are not impacted by this change as their total income up to Rs.5 lakh was anyway not subject to tax. The rebate will cost the government `18,500 crore in revenue. At a post budget press conference, Goyal promised to look into giving relief to taxpayers with an income of over Rs. 5 lakh in the main budget to be presented in July. In the Budget for 2019-20, he also raised stan-

dard deduction by Rs.10,000 to Rs.50,000 which will provide a benefit ranging from Rs.2,080 to Rs.3,588 depending on income levels. Other proposals include increase in the TDS exemption limit from Rs.10,000 to Rs.40,000 for bank interest, on rental income from 1.8 lakh to 2.4 lakh, extending housing income exemption from one to two self-occupied houses, capital gains from sale of house property being allowed to be invested in two properties instead of one and the 10-year window for registration of affordable housing projects for getting tax relief. As was widely anticipated, Goyal announced an as an "account for votes" and not a "vote on income support scheme for 12 crore small and account". The farm income support scheme will marginal farmers by providing result in the government breaching its Rs.6,000 in their bank accounts 3.3 per cent fiscal deficit target from in three equal installments in the current year and slipping on 3.1 a year, which will cost per cent target for the next. Fiscal Rs.75,000 crore a year to deficit for both the years has been the government. The eligiput at 3.4 per cent of the GDP. bility for the scheme, Wooing farmers, an interest called Pradhan Mantri subvention of 2 per cent to Kisan Samman Nidhi, will those pursuing animal husbe ownership of less than bandry and fisheries and to two hectares of cultivable farmers hit by natural calamiland. ties was announced in the Though the finance minister Budget. An additional 3 per cent said the scheme will be impleinterest subvention will be mented from the current fiscal given to farmers for timeyear, where it will cost Rs. 20,000 ly repayment of loans. crore, it wasn't clear how the benefiWhile defence allocaciaries would be identified. tion has been raised A mega pension scheme by 7 per cent to over was introduced to provide Rs.3 lakh crore, suba monthly pension of Rs. sidy bill has gone up 3,000 with a contribution to Rs.2.97 lakh crore of Rs.100 per month for from Rs.2.66 lakh workers in the unorgancrore. ised sector after 60 years of age. While Prime Minister Narendra Modi said the interim budget was merely a "trailer" of what will guide India towards prosperity after the Lok Sabha polls, Congress president Rahul Gandhi said that the government was giving Rs.17 a day to farmers after "destroying" their lives in last five years. Former finance minister P Chidambaram termed the Union Budget

HIGHLIGHTS Income up to Rs 5 lakh exempted from income tax Standard Deduction raised to Rs 50,000 from Rs 40,000 - Direct tax proposals to provide Rs 23,000 cr relief to 3 cr taxpayers - Persons with gross income up to Rs 6.50 lakh not required to pay any income tax if they make investments in provident funds, specified savings and insurance.

Target for revenue from disinvestment of government stake in PSUs has been raised to Rs.90,000 crore from Rs.80,000 crore and dividend from the RBI and other banks has been pegged at Rs.82,900 crore. The relief in income tax for the middle class came in form of a rebate. A rebate is different from a general exemption which would have meant income up to Rs.5 lakh for all would have been exempt from taxes and taxes would have to be paid only on income in excess of that. For anyone earning more than Rs.5 lakh annually will continue to pay taxes at the prevailing rates - no tax on first Rs.2.5 lakh, 5 per cent on income between Rs.2.5 and 5 lakh, 20 per cent on income between Rs.5 lakh and Rs.10 lakh and 30 per cent on earnings of over Rs.10 lakh. Justifying inclusion of tax proposals in an interim budget which normally is only to seek approval of Parliament for spending for an interim period until a new government is sworn in, Goyal said, "Though as per convention, the main tax proposals will be presented in regular budget, small taxpayers especially middle class, salary earners, pensioners and senior citizens need certainty in their minds at the beginning of the year about their taxes." "Therefore, proposals, particularly relating to such class of persons should not wait." The NDA government, he said, has laid the foundation for India's growth and development for times to come. India is poised to become a USD 5 trillion economy in the next five years.

Rs 1.58 lakh crore allotted to Railways, highest ever allocation New Delhi: Finance Minister Piyush Goyal announced Friday a capital expenditure allocation of Rs 1.58 lakh crore for the Railways, the highest ever for the national transporter, in an effort to put its flagging revenues back on track. Last year, then Finance Minister Arun Jaitley had allocated an amount of Rs 1.48 lakh crore for the Railways in his budget. Goyal, who is also the Railway minister, said so far 2018-2019 has been the safest for the Indian

Railways and all unmanned level technology by our engineers will 'Make in India' programme and give an impetus create jobs," Goyal said in his crossings on the broad gauge netto the debut budget speech. work have been completely elimThe budget estimates under inated. revenue for the year 2019"Capital expenditure programme 20 (gross) is Rs of the Railways is at all-time high 2,72,705.68 crore, of Rs 1.58 lakh crore in next recording an increase financial year. 'Vande Bharat of Rs 22,854.67 crore Express', the indigenously over the revised estideveloped semi-high speed mates of Rs train, will give Indian 2,49,851.01 crore for passengers world 2018-19. In the budget, class experience. funds of Rs 7,255 crore have "This major leap in been allocated for construction of wholly developed

new lines, Rs 2,200 crore for gauge conversion, Rs 700 crore for doubling, Rs 6,114.82 crore for rolling stock and Rs 1,750 crore for signalling and telecom. No railway fare hike was announced in the Railway Budget for 2019. It is expected, keeping in mind the upcoming Lok Sabha elections soon. Developing passenger amenities has been allocated a sum of Rs 3,422 crores which is an additional outlay of around Rs 1,000 crore for the comfort of rail users.

z 12 crore small, marginal farmers to be provided assured yearly income of Rs 6,000 under PM-KISAN Scheme z TDS threshold raised to Rs 40,000 from Rs 10,000 on interest earned on bank/post office deposits z Tax exempted on notional rent on a second self-occupied house z TDS threshold for deduction of tax on rent to be increased to Rs 2.40 lakh from Rs 1.80 lakh z Tax benefits for affordable housing extended till March 31, 2020 z Tax exemption period on notional rent on unsold inventories extended to two years from one year z Allocated Rs 20,000 crore in 2018-19, Rs 75,000 crore for FY2019-20 for PM-KISAN Scheme z Interest subvention of 2 pc during disaster to be provided to farmers for the entire period of reschedulement of loan z 2 pc interest subvention to farmers for animal husbandry and fisheries activities; additional 3 pc in case of timely repayment z Rs 3,000/month pension for 10 cr unorganised sector workers with contribution of Rs 100/55 per month under PM Shram Yogi Maandhan Scheme z Fiscal deficit pegged at 3.4 pc of GDP for 2019-20; target of 3 pc of fiscal deficit to be achieved by 2020-21 z Current Account Deficit pegged at 2.5 pc of GDP for FY20 z Total expenditure to rise by 13 pc to Rs 27.84 lakh cr in FY20 z National Education Mission allocation increased by about 20 pc to Rs 38,572 cr z Allocation for Integrated Child Development Scheme increased by over 18 pc to Rs 27,584 cr z Disinvestment target of Rs 80,000 cr in 2018-19 likely to be met; Target for FY20 set at Rs 90,000 cr z 25 pc additional seats in educational institutions to meet the 10 per cent reservation for the poor z Defence budget to cross Rs 3,00,000 cr for the first time z Allocation for North East increased by 21 pc to Rs 58,166 cr in FY20 z Railways to get capital support of Rs 64,587 cr in FY20 z Indian filmmakers to get access to single window clearance for ease of shooting films; regulatory norms to rely more on self-declaration z 2 pc interest subsidy for MSMEs on an incremental loan of Rs 1 crore for GST-registered entities z At least 3 pc of the 25 pc sourcing for the government undertakings to be from women-owned SMEs z One lakh villages to be transformed into digital ones in 5 years z New portal to support national programme on Artificial Intelligence z Reforms in stamp duty; amendments to ensure streamlined system for levy of stamp duties to be imposed and collected at one place z A separate Department of Fisheries to be created for welfare of 1.5 crore fishermen z 22nd AIIMS to be setup in Haryana z Rs 60,000 crore allocation for MGNREGA in 2019-20 India poised to become USD 5 trillion economy in next 5 years; aspires to become USD 10 trillion in the subsequent 8 years.

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Rs 6,000 to small farmers, Rs 5 lakh income exempt from income tax, monthly pension of Rs 3,000 to workers in informal sector

RAJEEV RANJAN MISHRA

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PRAYAGRAJ The nation seems to have entered into election mode. All moves by the various political parties whether they are ruling or in Opposition are focussed only on 2019 Lok Sabha elections. The statements of some leaders particularly those who feel are well saddled in their home turf are smacking of arrogance. The advantage such parties have is that there is no voice of dissent. During Emergency, voice of the common man was muzzled but there used to be hush hush talk and Opposition grew among the voters which took the form of a Tsunami and threw the Congress out of power. But now the situation is different. Parties in power are trying to introduce control over various institutions including the media. In some States, particularly in the southern part of the country, the attitude of the party in power is 'take what we give, write what we say.' What is more interesting is such words roll out during the speeches given by the top most leaders including Chief Ministers and party presidents. The saddest part is that those who should raise their voice seem to have sealed their lips whatever the reasons be. Political parties may feel that everything is under control. But they should not forget that the voter is far more intelligent and knows

when to strike hard. While in 2014, there was sort of an emotional wave in favour of Modi, this time the voter is thinking seriously as to who their leader should be. They are watching all machinations with hawk eye and there could be many surprises. It appears that the saffron party has sensed that all is not well, and Modi-Shah duo's charisma is on the wane. Hence, it is now coming up with strategies to woo the voters. The BJP hopes that the ten percent reservation to the economically weaker sections would rain in votes. Well, to what extent it will help the party to get back into driving seat remains to be seen. If the present trend and the people's perception are any indication, the BJP has an uphill task. One argument is that BJP has advantage as it would come up with several offers for the voters in its budget and that the Opposition unity is still not clear, and many parties would be fighting against the BJP and the many-cornered contest will help Modi stage a comeback. But if one goes by what the Opposition says and is doing, there will be direct fight between two parties or coalitions. According to political analysts, there could be a direct fight between the BJP and the coalitions or parties that are strong in those regions in over 400 seats. In other seats, there could be triangular contest particularly in States like West Bengal, Odisha and Delhi. Maharashtra presents a different scenario. It remains to be seen what stand the

Shiv Sena would ultimately take. Sena has been attacking the BJP and if the coalition breaks, it could turn into a triangular contest which can be big loss for the BJP. But the general experience in the past has been that on the eve of elections, they bury their differences. If that happens, there will be direct contest between Sena-BJP and Congress-NCP in the State. Coming down south, in Tamil Nadu, it is going to be a direct fight between the DMKCongress alliance and the AIADMK-BJP. In Telangana, it will be a triangular fight as there would be no alliances. In Andhra Pradesh, the scenario is more complicated. The TDP has successfully created an anti-BJP wave and here the fight would be among the TDP, YSRCP, Jana Sena and the Congress. In 2014, the poll scenario was one where people were tired of a decade of Congress-led government and wanted a change. An impression had gone around that there was an accidental Prime Minister. Allegations of corruption had touched a new high. Inflation was at its peak. But this time issues are different. The negative impact of demonetisation, the fall in farm incomes and growing rural debt seem to be taking centre stage. Similarly, the issue of jobs and the rift between the Centre and the State on several issues and the growing feeling that the Centre had not followed the principle of cooperative federalism could pose a challenge for the ruling party.

Though caste plays a significant role in the elections, this time the slogans of the BJP may not hold the key. Even reservations and the emotive mandir issue may not help them as they expect. Rural distress in Maharashtra and problems faced by sugarcane farmers could adversely affect the fortunes of the ruling BJP. The BJP in the north has huge cadre which has well penetrated into the rural areas, but economic policies can strain such organisational gains. In the last five years, Modi had firm hand on the wheel and had great mass appeal after Indira Gandhi. But history shows that such an appeal has its own limits if voters decide that enough is enough. The fact is that Modi while having his hand firm on the wheel did not take care to avoid over centralisation of power. The question the voters are asking themselves is are they better off now than 2014? The BJP leaders refuse to accept the fact that that they have a rough road ahead even in States like Andhra Pradesh where the writing on the wall is very clear. They claim that the recent Assembly results in the Hindi States cannot be an indication of change of winds and that it was a semi-final. If you take a peak at the elections held in 2018, one would find that the BJP faced a tough situation in Gujarat, the home turf of Modi and Amit Shah. Though it came back to power, it got 16 seats less than the previous election. It also lost in Punjab.

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Hurdles many for BJP, yet high on hopes


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