Politics

2017 Finance bill to undergo major reforms

22 Mar 2017 | By Anish Chakraborty
Finance Bill will have more than 40 changes

Arun Jaitley suggested a major overhaul in finance bill to bring about electoral reforms.

As many as 40 changes have been suggested in existing legislations related to government's revenue.

The NDA government is also revamping some major laws including the RBI Act and Income Tax Act to facilitate fund raising via electoral bonds to political parties.

Here are some of the major changes.

In context: Finance Bill will have more than 40 changes

22 Mar 20172017 Finance bill to undergo major reforms

Cash CeilingBringing down the cash ceiling

In an attempt to keep a check on black money, it has been suggested that the cash transaction limit should be brought down to Rs. 2 lakh from the erstwhile Rs. 3 lakh cap limit.

Failure to comply would lead to a fine that is going to be equivalent to the amount transacted above the limit.

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Aadhaar card becomes mandatory for Income Tax filling

AadhaarAadhaar card becomes mandatory for Income Tax filling

One of the major changes proposed is that the Aadhaar card should become mandatory for filing IT returns.

Permanent account number (PAN) will only be issued upon producing the Aadhaar card of the individual.

Aadhaar is already mandatory for availing benefits under the Pradhan Mantri Kaushal Vikas Yojana and the centre is looking at 31 more schemes where it has to be provided.

DonationsMore transparency in political donations

The government also looks to bring major changes in the Company Act, making disclosure mandatory of the amount the firm pays for election related donations.

These donations will now have to be carried with the usage of cheque, bank draft or via online transactions and not by cash so that a proper money trail is at place.

22 Mar 2017Keeping a paper trail of electoral funding

To keep a track on money acquired by funding, electoral bonds are going to be issued, these will be available on issuance of a cheque and money will go directly to the political party in a pre-declared account.

There will also be income tax incentive for money paid by cheque, or small donation, or mass collection by digital medium and electoral bond issued.

AmendmentsActs up for amendment in the Finance Bill 2017

These changes are going to reflect in the Companies Act, the Employees Provident Fund and Miscellaneous Provisions Act, the Industrial Disputes Act, the Copyright Act, the Trade Marks Act, the Railway Claims Tribunal Act and the Railways Act.

Jaitley defended the changes by calling them "incidental provisions" and no tax reform can be opposed without reference of a court or a tribunal.

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Sitaram Yechury,CPM leader

"This is a subversion of the Constitution to bypass the Rajya Sabha as the Finance Bill is a money bill. This exposes the government's anti-democratic methods."

30 Mar 2017Opposition forces 5 amendments to Finance Bill in RS

The opposition forced 5 amendments to the Finance Bill to be adopted by the Rajya Sabha, in what is seen as a setback to the Centre.

Congress MP Digvijaya Singh moved 3 amendments, while CPI(M)'s Sitaram Yechury moved 2. Meanwhile, Finance Minister Arun Jaitley defended the move to make Aadhaar mandatory.

The bill will have to be reconsidered by the Lok Sabha now.

30 Mar 2017Lok Sabha passes Finance Bill, rejects RS amendments

The Lok Sabha passed the Finance Bill, without accepting any of the 5 amendments suggested by the Rajya Sabha.

Finance Minister Arun Jaitley said "I can't accept five amendments suggested by Rajya Sabha to the Finance bill."

Deepender Hooda of the Congress said by bypassing the amendments, the Finance Minister made the Rajya Sabha "incidental". He said the government created room for "political extortion."