 "bud-17-budget, budget")
Advancing the Budget and notifying of the Finance Act, 2017, has enabled the Centre and state governments to start spending out of the centrally allocated funds from the first month of the financial year itself.
Earlier, mostly expenditure for meeting current liabilities, such as salaries and pensions, used to be incurred from April. The rest of the crucial outlays would have to wait till the enactment of the Finance Act, which used to take place in June. By that time, the monsoon would have arrived and the farmers would have already started sowing.
Early release of expenditure, particularly capex (capital expenditure), is all the more relevant in the current juncture when the economy is taking time to recover after the demonetisation of Rs 500 and Rs 1,000 currency notes. Economic growth slowed down to 7.1 per cent in 2016-17 compared to 7.9 per cent in the previous year. The economy is not likely to come back to the growth rate clocked in 2015-16 even in the next two years, according to various estimates.
As such, the government is learnt to be releasing almost 50 per cent of the Rs 48,000 crore allocated under the Mahatma Gandhi National Rural Employment Guarantee Scheme in 2017-18 itself.
The government will also be releasing Rs 20,000 crore to the Food Corporation of India this month to enable Punjab and Haryana to start procurement.
Also, a chunk of the Rs 1.45 lakh crore food subsidy would also be allocated this month itself, sources said.
Lok Sabha Speaker Sumitra Mahajan said that the allocated funds to each department have become available to them on April 1 and they have a full one year to spend the same on old and new schemes.
She added that for the past many decades, the Budget used to be presented in the last days of February, sometimes in March or April, and the subsequent delay in budgetary allocations by 4-5 months was part of the process.
Further, the Speaker said that this timely completion of all Budget related processes would also help the state governments in preparing their respective state Budgets.
Besides expenditure, other things which would be effective from the very beginning of the financial year are new income tax returns forms, including the one-page form for those having a salary of up to Rs 50 lakh and rent income from one property. Earlier, income tax returns used to get notified somewhere in May.
Also, the new norm to limit cash spending per transaction to Rs 2 lakh has also come into effect from April 1. Those receiving more than this amount would have to pay a penalty equivalent to the amount received. Deposits withdrawn from banks and post offices will not form part of these transactions.
However, mandatory quoting of Aadhaar number in the ITR forms will not come into effect from April one. This will be effective from July one. Until June, one can file returns without quoting their Aadhaar number. Those individuals who have stayed in the country for less than 182 days in a year prior to July one, 2017, will not be asked to apply for Aadhaar. Those who have stayed for at least 182 days in this period will have to get Aadhaar. Or else, they will have to file returns by June 30 this year. Those who have left India might have to come back to India if they are filing returns after June 30 as Aadhaar has biometric details.
Service tax, which used to be effective from June earlier, has also become effective from April one. However, this should not be a problem as there was hardly any change in the service tax regime in this year's Budget. The service tax regime, in its present form, will last until June 30 only, after which the goods and services tax regime is slated to take over.
