1) 60 per cent of provident fund withdrawals will be taxed from April 1, 2016, according to Budget 2016. Currently, withdrawals from Employee Provident Fund are completely exempt from income tax. (Negative for middle class)
2) Total allocation for agriculture sector has been hiked to Rs. 35,984 crore. (Positive for agrarian sector)
3) Thumbs up for MGNERGA: Government will spend a record Rs. 38,500 crore on rural jobs programme (MGNREGA). Rural road development schemes will get Rs. 19,000 crore, while another Rs. 20,000 crore will be used to fund irrigation schemes. (Positive to address rural stress as well as to create purchasing power in rural economy)
4) The finance minister allocated Rs. 2.21 lakh crore for building road and rail infrastructure. (Positive for everyone)
5) A new amnesty scheme for those holding unaccounted money and assets has been announced. Those declaring undisclosed income under this scheme will have to pay 45 per cent tax. (Negative for honest taxpayers. Also non-starter as nobody is going to pay 45% tax on black money)
6) some good changes in dispute redressal mechanism in income tax. (positive for taxpayers but negative for CA/Lawyer)
This budget is good combination of NDA and UPA policies. NDA has adopted AADHAR and MGNREGA with full covictions in this budgets. Trust this will give pro people (marginal population) direction to policies of the government.