Tax experts give thumbs up Arun Jaitley’s Budget. Here’s what their analysis says

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The Prime Minister Narendra Modi -led Indian Government was looking to soothe pains of the common man after the demonetisation burns and the Finance Minister Arun Jaitley announced few tax concessions for the common man.

While announcing the tax measures in his Budget 2017 , Jaitley said the income tax rate for people earning income between Rs 2.5 lakh and Rs 5 lakh will be 5%. Presently, it is at 10%.

Also, the FM has levied a surcharge of 10% on people earning an income between Rs 50 lakh and Rs 1 crore. Also, 15% surcharge on income above Rs 1 crore will continue.

Also, the net revenue loss on direct tax proposals amounts to Rs 20,000 crore and the net tax revenue grew by 17% in 2015-16.

Experts welcomed the move, saying this is a fresh breeze of air, adding low income earners have been given relief.

Here’s what the experts’ analysis looks like

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1. Archit Gupta, Founder, ClearTax.com

1.	Archit Gupta, Founder, ClearTax.com
Businesses: The FM has announced massive reforms in tax rules, including audit and book keeping rules for small and medium businesses. This is bound to boost compliance amongst small taxpayers. We support this move for businesses which have suffered loss of business due to demonetisation. Threshold limits increase for audit for presumptive businesses from Rs 1 crore to 2 crore have been increased this year.
Individuals: The FM has given in to strong demands for lower taxes and offered a balm for demonetisation. Our exemption limits have stayed put since a long time. Low income earners have been given relief. This is important for a push post demonetisation and boosting growth.

2. Sachin Menon, Head of Indirect Tax, KPMG India

2.	Sachin Menon, Head of Indirect Tax, KPMG India
The budget seems to have given more thrust towards increasing the tax compliance by broadening the tax base rather than raising tax rates, which brings fresh breeze of air to the budget process. The budget estimates projects a revenue growth of 8.8% in indirect tax revenue as opposed to 15.3% growth in direct tax revenue without any major increase in the tax rates. That shows the confidence of the government to enforce stricter compliance post demonetisation and GST implementation.

3. Girish Vanvari, Head of Tax, KPMG India

3.	Girish Vanvari, Head of Tax, KPMG India
The additional 10% surcharge has been introduced on income between Rs 50 lakh and Rs 1 crore is a dampener for high networth individuals. MSME with turnover upto Rs 50 crores will benefit from lower tax rate of 25% and there are some concessions to boost the real estate sector. The thrust of the budget is to enhance the tax base and move towards digitization through several amendments in the act. In global macroeconomic backdrop, the calibration in the Indian economy post demonetisation and much awaited GST which is now on anvil, Budget 2017 is stable fine balancing act, with fiscal prudence, directional spending and no surprises on the taxation front which should lead the country to a sustainable growth path.

4. Santosh Dalvi, Partner-Indirect Tax, KPMG India

4.	Santosh Dalvi, Partner-Indirect Tax, KPMG India
The budget estimates 8.8% growth in indirect tax revenues as opposed to 15.3% growth in direct tax revenues, prima facie without imposing or increasing rate of taxes. This means that the focus is on increased compliance by broadening the tax base rather than raise the tax rates.
Overall, the Budget proposals seems to be in the right direction and efficient implementation of such proposals, would be the key to accelerate growth and improve Tax compliance in the country
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