Major Tax Changes Likely In Interim Budget? Here's A Recap

Piyush Goyal has been given the additional charge of finance ministry

New Delhi:  Union Minister Piyush Goyal will on Friday present the interim budget in Parliament. This budget will be the last by the NDA government before Lok Sabha elections due by May. From a cash package for the farmer to tax reliefs for the common man, expectations are high from the annual financial statement of the current administration. But can an interim budget contain income tax sops, or propose to significantly inflate expenditure?

Here are key things to know about some of the earlier interim budgets:

  1. P Chidambaram was the first finance minister to make significant tax changes in an interim budget.
  2. In his February 17, 2014 speech, Mr Chidambaram stated that the economic situation at the time demanded interventions that could not wait for a regular budget.
  3. In the 2014-15 interim budget, he announced a number of changes to indirect tax laws. These included excise duty cuts on items such as automobiles, mobile phones and industrial oils.
  4. Mr Chidambaram also proposed to exempt loading, unloading, packing and storage of rice from service tax.
  5. Among other changes, Mr Chidambaram accepted the principle of one rank one pension for the defence forces, to be implemented from the next financial year.
  6. However, Mr Chidambaram was not the only finance minister to have announced major changes with financial implications.
  7. In the interim budget for 2009-10, the then finance minister Pranab Mukherjee announced a six-month extension to a 2 per cent interest subvention on shipment credit for employment-oriented sectors. That involved an additional financial outgo of Rs 500 crore.
  8. He also proposed refinancing of up to 60 per cent of commercial bank loans for PPP projects in critical sectors by IIFCL. That involved a total investment of Rs 100,000 crore in infrastructure.

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