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For India Union Budget 2018, What does Finance Minister Arun Jaitley have up his sleeve? The 2018 budget will be presented on 1 Feb 2018. It is going to be the last full Budget before the 2019 Lok Sabha polls. It is going to be a breakout Budget as its also the first one after GST implementation. What are the 2018 Budget Possibilities?

The pre-budget discussions are still on at the Ministry of Finance in relation to the upcoming Union Budget. The Finance Ministry and Honorable Minister of Finance Mr Arun Jaitley works with the top CEOs of the financial services, Ministers of State for Finance Mr. Pon Radhakrishnan and Mr. SP Shukla, the Finance Secretary Mr Hasmukh Adhia, the RBI Deputy Governor Mr. N. S. Vishwanathan, and other key people from the administration to have budget 2018-19 India discussions.

This year the government of India is giving prime importance to the cashless finance. The last year of 2017 was the year of cashless. With the readiness of IndiaStack, the coming year of 2018 can be also the year of paperless access to financial products. As per the RBI household committee report, the household income can rise by as much as 10% if the consumers have access to the right financial products. And this increase in the household income can lead to the increase in the country’s GDP.

The Government of India will encourage paperless access to financial products because:

  • It will increase the monetary limit for Paper-Less e-KYC via OTP. It will eradicate the requirement to collect the physical copy of PAN or Passport
  • It will create a push for the usage of e-Sign to sign documents digitally
  • It will create a push for 100% paperless onboarding of accounts for all the financial products like the adoption of e-NACH and Digi Locker technologies.

This year’s 2018 Budget may also create a separate tax exemption for Term Life Insurance. As of now, the maximum tax exemption under Section 80C of the Income Tax slab is Rs.1.5 lakh. The insurance industry demands to raise the bar as it wishes to motivate the people to buy more term plans so that it helps them to insure their lives in a better way that too at a low premium cost. Hence, the industry has requested for the separate exemption limit for premiums paid towards term insurance.

The 2018 Budget also may increase the limits on affordable housing. In a recent move, the interest rate subsidies on the Home Loans were provided to the middle-income group households. Like for the households with their earning between Rs.6 and 12 lakh a year, were able to claim a 4% subsidy on Home Loan amounts up to Rs.9 lakh. The households that were earning between Rs.12 and 18 lakh annually were able to get the 3% subsidy on loans amounts up to Rs.12 lakh. Now, the industry wishes to raise this slab so that they are able to cope with the rising costs of property in the urban areas.

The 2018 budget must also increase the TDS limit for bank interest. The Tax Deducted at Source limit for bank interest is currently only Rs.10,000. This limit was set last in the year 1997, which was way back. To ensure more interest in hand for bank customers, the same should be revised now.

2018 Budget

2018 Budget

Reference Articles:

How is Union Budget made

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