Note ban, GST delay to influence Budget calculations

Mumbai: Finance Minister Arun Jaitley is all set to present Union Budget 2017 in Parliament on February 1. This year, Jaitley faces many challenges to have to tackle with in order to bring out a 'world class' budget.

One of the many tough tasks ahead for him was the outcome of delay in implementation of Goods and Services Tax regime and concerns as to how to deal with its aftermath?

Government had highly anticipated that it would manage to roll out the One Nation One Tax regime from April 1, 2017, a deadline that has now been pushed back to July 1. It would have facilitated calculation of indirect taxe rates.

Demonetisation has taken its toll on the Budget calculations too as Jaitley would find it hard to arrive at a simplified indirect taxes structure. Budget had hoped for new indirect tax rates under the GST regime. That has not happened though.

The economic disruption caused by the notes ban makes it a tough job to forecast next year's revenue,” said NDTV in an article. Budget's key task is to allot funds to government so that it continues to work. Besides, it also calculates total revenues and total expenditure based on total tax revenues.

“It is an unprecedented budget,” the channel quoted a Reuters’ news report that sourced the information form a government official in the know of ongoing budgetary exercise.

Finance Minister Jaitley is expected to bring in a cut of perhaps one percentage point in the 30 per cent corporate tax rate, NDTV quoted Sandeep Chaufla, a partner at tax consultancy PricewaterhouseCoopers.