5 major likely changes in Arun Jaitley's 2017 Budget

The Narendra Modi government is busy preparing its third Budget. However, the budget-making process has also been affected by demonetisation. Some officials involved in the budget-making process claimed that it started late due to the note ban decision.

According to the Centre, the budget (General and Railway) would be laid on February 1. It is obvious that the forthcoming budget would be most crucial for the Modi government ever since it came to power in May 2014. The government would aim at minimising any adverse impact of the budget. Simultaneously, it would strive to give sops to the common man in view of the Assembly elections after the budget presentation.

In any case, these are the five provisions which could find prominence in the next year's budget:

1. Major relief in Income tax

The government could give a major relief in Income Tax for the financial year 2017-18 to woo the tax-paying class. Finance Minister Arun Jaitley has indicated that the government may provide relief to the common man.

2. Cheap housing

The Modi government could reduce the interest rate on home loan between 5 and 6 per cent. In its first budget in 2015, the government had made provisions for cheap housing. Since the announcement was made in the midst of financial slump, the builders did not show much interest in it.

3. Cheaper two wheelers and small cars

The auto industry has been the worst affected due to demonetisation. In November, the month in which the note ban was announced, the sale of two wheelers, small cars and commercial vehicles fell by 10 per cent. The government could announce cutting the cost of these vehicles to offset the impact of demonetisation.

4. Strengthening of MNERGA

People below poverty line are facing the hardest times after the fresh initiative. Their job opportunities have shrunk. The poor are forced to leave cities and go back to their villages. Financial experts are of the opinion that unemployment could rise for some period. The government could significantly enhance the budgetary allocation of MNERGA to counter the impact. A big announcement could also be made for the direct benefit transfer scheme to connect this section of the population to cashless economy.

5. Major step against benami properties

After the demonetisation move, Prime Minister Narendra Modi had indicated in Goa that the government could take a path-breaking step against benami properties. The agricultural land could be linked with AADHAAR. Further, the immoveable properties could be linked to PAN card. These two steps could prove decisive in the government's war against corruption.

Also read: With note ban, PM creating new normal by stopping 70-year norm: Arun Jaitley

Also read: Demonetisation to have positive impact on economy: Finance Minister Arun Jaitley