Union Budget (2017-18): Promotion of Make in India

Basic Custom Duty on RO membrane element for household type filters increased from 7.5% TO 10%
Basic Custom Duty on Renewable Energy devices reduced to around 5 to 6%
Basic Custom Duty on All parts for use in the manufacture of LED lights or fixtures, including LED lamps, subject to actual user condition lowered and brought to 5 to 6%
Basic Custom Duty on Capital goods for use in the manufacture of CNC machine tools reduced to 2.5%

Service Tax

Rate of Service Tax has been kept intact at 14% though it was apprehended to be increased to 18%

Services provided by the Indian Institutes of Management, for Full Time Post Graduated Programmes in Management or Post Graduate Diploma in Management though it is not residential course will be exempt. Until now only Services towards residential courses were exempt.
Income Tax

Individual and HUF not covered under Tax audit shall also be required to deduct TDS @ 5% from the tenant if the monthly rent exceeds Rs. 50000/-, previously Individuals and HUFs which are required for Tax Audit were only liable to deduct tax for rent paid if rent paid exceeded Rs 1,80,000 annually to a single person.

Presently if one holds an Asset like property, plot etc and then sells it, Long Term Capital Gain is allowed to be paid, if the asset was held by that person for more than 3 years, now this period has been proposed to be reduced to 2 years. Benefit, holding the asset for only two years will allow the benefit of long term capital gain to the person. It will boost mainly housing industry.

The existing provision of section 54EC provides that capital gain to the extent of Rs. 50 lakhs arising from the transfer of a long-term capital asset shall be exempt if the amount is invested in Capital Gain Bonds of National Highway Authority of India or Rural Electrification Corporation of India. Now for saving of Capital Gains, this amount will be allowed to be invested in any long term bonds which are notified by Central Government.

For builders and developers, there is very positive budgetary change that on unsold buildings held as stock in business, no tax will be imposed on assumed Rental Income for a period of one year from the date of completion certificate of the building.

In order to provide cash less economy and transparency, it is proposed to amend section 80G so as to provide that no deduction shall be allowed under the section 80G in respect of donation of any sum exceeding two thousand rupees unless such sum is paid by any mode other than cash. The present limit is Rs. 10000/- it is reduced to Rs. 2000/-

Presently under Section 40A of the Act, any expenditure in respect of which payment or aggregate of payments made to a person in a day, otherwise than by an account payee cheque drawn on a bank or account payee bank draft, exceeds twenty thousand rupees, is not allowed as a deduction. Now cash expenditure shall be limited to Rs. 10000/-only and if payment of such expenditure in a single day is made for more than Rs 10000/- in cash then in such case the expenditure will not be allowed.

Presently for small businesses, up to the turnover of Rs. 2 Crores, presumptive taxation scheme is allowed whereby income tax can be paid assuming the income to be 8% of the turnover, and even Tax Audit and maintenance of books is also not required in these cases. Now it is proposed that in respect of non-cash sales/receipts, the presumptive profit shall be 6% and not 8%. It will promote digital mode of business transactions.