The budget 2017 is being hailed in the words of the Prime Minister of India as an Uttam Budget with the vision of empowering all honest citizens of the country. The budget for several reasons has drawn applause from various sectors with markets giving it a clear thumbs up. The budget in the view of the Finance Minister, Arun Jaitley and Narendar Modi is historic and excellent with some thing to cheer up all sections of the society and soften the harsh effect of the demonetisation blow.

Apart from its key focus on day 1 of the budget on the rural and infrastructure sector of the economy, the budget brought further cheer to the middle class income groups with beneficial tax sops.

In the words of the Finance Minister, Indians by nature have become so corrupt that tax noncompliance is a way of life for most rich people in the country who look out for ways to hide money from the IT departments.  He pointed out that direct tax collection is not commensurate with the income and the expenditure pattern of citizens. Out of the 76 lakh people accessed with incomes above Rs 5 lakh, 56 lakh are in the salaried class.

“Over the last few decades’ tax evasion has become a way of life and we are a largely tax non compliant society where the burden falls on the honest tax payers”, the FM stated while presenting the budget.

He compared the situations where according to official data there are only 1.76 lakh people in the entire country who earn more than Rs 50 lakh per annum but in contrast to this, in the last 5 years more than 1.25 crore cars have been sold while the number of foreign trips undertaken by Indians for various reasons has been up to 2 crores till 2015. The contradiction clearly presenting the conclusion that India’s tax contribution to the GDP ratio is rather abysmal and from the point of view of social justice, the ration of direct and indirect taxes is not good enough to harbour good gains in the future.

Arun Jaitley also brought to shore the fact that though there were officially close to 4.2 crore people engaged in organised sector’s employment, only 1.81 crore people were filing in their taxes. The issue of corruption in the organised sector is also relevant from the facts that despite almost 14 lakh companies registered in India uptil 2014, only 5.97 lakh have filed returns for the year 2016-17. The rest of the 2 lakh companies have shown losses or zero income at the end of the assessment year.

The effects of demonetisation were first witnesses when the unprecedented deposits were reported from across the country hinting at all the money that was being kept away as black money. Talking about this effect, Jaitley stated that, “ deposits of more than Rs 80 lakhs were made in over 1.5 lakh accounts with an average deposit size of Rs 3. 31 crore. This will help us expanding the tax net as well as increasing the revenues which was one of the most important aspects of demonetisation.”