Budget 2016 HighLights

Budget 2016 HighLights Points Summary

Here is the budget 2016 Highlights Points Summary which is announced by Government of India.

Finance Minister says:

  • Govt. has to prioritize expenditure. Focus on the rural and social sectors, infrastructure and recapitalization of banks
  • Agenda for next year is to undertake transformative measures based on 9 pillars for India – Agriculture, rural sector, social sector, edu skills/job creation, infra investment, financial sector reforms, governance, ease of doing business, fiscal & tax reforms
  • PSU Insurance Companies To Be Listed
  • Statutory backing for Aadhar soon
  • A unified agriculture market e-platform will be dedicated to the nation on the birthday of Dr. B.R. Ambedkar
  • 100% rural electrification of Indian villages by May 2018
  • Rs 9,000 crores allocated to Swaccha Bharat Abhiyaan
  • 3,000 new Jan Aushadhi stores to come up for quality medicines
  • 100% FDI to be allowed through FIPB route in Food Products Produced and Marketed in India
  • Fiscal deficit target retained at 3.5 per cent of GDP


  • National Skill Development Mission has imparted training to 76 lakh youth. 1500 Multi skill training institutes to be set up
  • Digital depository for academic certificates to help reduce the issue of fake degrees
  • Rs. 1000 cr set aside for higher education financing
  • We will interlink state employment exchanges with national service career platform
  • Objective to skill 1 crore youth in next 3 years under the PM Kaushal Vikas Yojana


  • Rs 55,000 crore set aside for roads and highways in FY17
  • 85% of stalled road projects back on track
  • Total allocation to road sector including PMGSY: Rs. 97,000 crores
  • A mammoth total outlay of Rs 2,18,000 crore for railways and roads in FY17
  • Total outlay for infrastructure Rs. 2,21,246 crores in 2016/17
  • Target of 10,000 kms of national highway and upgradation of 50,000 kms of state highways in 2016/17
  • Rs 3,000 crore allocated for nuclear power
  • Private Entrepreneurs to be allowed to run bus services on various routes, subject to efficiency
  • 50% of tax as penalty for income under-reporting cases, 200% for misreporting facts


  • Growth of GDP has accelerated to 7.6% .Retail inflation declined to 5.4%
  • Forex Reserves have reached their highest mark at $350 billion
  • FY16 CAD seen at 1.4% of GDP
  • New Financial Data Management Centre to facilitate integrated data analysis
  • Department of Disinvestment to be renamed as Department of Investment and Public Asset Management
  • Asset-reconstruction companies’ sponsors to be allowed to hold 100%; Sarfaesi Act to be amended
  • RBI Act to be amended to give statutory backing for monetary policy
  • Comprehensive code to provide specialised resolution mechanism for bankruptcy of banks/insurance firms
  • 25,000 crore for recapitalization of public sector banks
  • An increased allocation of Rs 1,80,000 Crores under PM MUDRA Yojana
  • More no. of benches of Security Appellate Tribunal to be introduced by amending SEBI Act to reduce pendency
  • Plan Non-plan distinction to be removed from 2017/18
  • Revenue gains of Rs 19,600 cr from indirect and direct tax changes


Tax Slabs remain unchanged at:
Income up to Rs 2.5 lakh: NIL tax
Income between Rs 2.5-5 lakh: Tax at 10%
Income between 5-10 lakh: Tax at 20%
Income above Rs 10 lakh: Tax at 30%
  • Ceiling of tax rebate for tax payers with up to Rs 5 lakh annual income to be raised to Rs 5000 from Rs 2000
  • HRA deduction increased to Rs 60,000 per annum from Rs 24,000 per annum
  • Presumptive I-T scheme extended to all professions
  • Krishi Kalyan Cess of 0.5% on all taxable services
  • Tax compliance window from Jun 1-Sep 30 for declaring undisclosed income
  • To reduce multiplicity of taxes and cascading – 13 taxes with collection less than Rs. 50 Crores a year abolished
  • 11 new benches of tax tribunals to be established to reduce pendency


  • Corp tax rate cut to 29% from FY18 for firms with turnover of less than Rs 5 cr
  • 100% deduction on profits for start-ups for 3 out of first 5 years; MAT to apply
  • Capital gains not to be taxed on investments in regulated Fund of Funds for start-ups
  • 100% deduction on profits to undertakings for construction of affordable housing


Service tax exemption for construction of affordable housing upto 60 sq.m. under state and central housing schemes
STT in options to be increased to 0.05 per cent
Excise duty on most tobacco products raised by 10-15%

Quick View of Budget 2016 HighLights Summary :-

1. Corporate tax reduced to 29% for small business having turnover less than 5 crores
2. Reduction in corporate tax – New manufacturing companies after March 1, 2016 have to pay tax at 25%
3. Presumptive taxation scheme introduced for all professionals with receipts up to Rs. 50 lakhs.
4. FM increases the turnover limit of presumptive taxation Scheme to 2 crores
5. Deduction under Section 80GG for individuals paying rent but not receiving HRA proposed to be increased from Rs. 24,000 to Rs. 60,000.
6. Relief under Section 87A proposed to be increased from Rs. 2,000 to Rs. 5,000
7. Registration of Companies should be given in one day – Companies Act proposed to be amended
8. RBI Act to be amended for providing framework for Monetary Policy Code: FM
9. SEBI Act proposed to be amended to provide more numbers of Securities Appellate Tribunal
10. Amendments in SAFRAESI Act to tackle problem of stressed assets in ARCs
11. FM proposes various amendments to SARFAESI Act
12. Deduction under Section 80JJAA proposed to be extended to all assessee who are subject to tax audit
13. A comprehensive code to provide bankruptcy resolution mechanism will be presented: FM proposes
14. Rs. 1,700 crores allocated for Skill India Mission under Pradhan Mantri Kaushal Vikas Yojna
15. 100% FDI to be allowed in marketing of food products manufactured and produced in India
16. Stand up India scheme to promote SC & ST entrepreneur: FM
17. National SC/ST hub will be created to provide professional support to SC/ST entrepreneurs
18. Certain Dialysis equipment are proposed to be exempted from Basic Custom Duty, Excise Duty and CVD
19. Govt. will launch new health protection scheme to provide health cover of Rs. 1 Lakh
20. Health Insurance of Rs. 1,00,000 with top up of Rs. 30,000 proposed for senior citizen
21. Rs. 38000 crore proposed to be spent on MANREGA in FY 16-17
22. Provision of Rs. 15,000 crores is proposed to reduce burden of farmers loan: FM
23. We need tax reforms to reduce tax compliances: FM
24. Govt. to focus on passing of GST and Bankruptcy laws: FM Arun Jaitley
25. FM: Nominal premium and highest ever compensation in case of crop loss under PM ‘Fasal Bima Yojana’
26. Farm, rural sector, infra, social sector to have more Government expenditure, says FM
27. Govt. will start initiative to provide free gas connection to BPL families: FM
28. FM Arun Jaitley: We have bridged the trust deficit created by the previous government
29. Forex reserves at highest level and fiscal deficit has declined: Arun Jaitley
30. Growth of GDP accelerated, CPI inflation come down: FM