Union Budget FY 21
Union Budget was Presented by our Finance Minister on 01st February, 2020 which was based on three themes and two approaches.
Aspirational India :
- Agriculture, Irrigation and Rural Development
- Wellness, Water and Sanitation
- Education and Skills
Economic Development:
- Industry, Commerce and Investment
- Infrastructure
- New Economy
Caring Society:
- Women & Child, Social Welfare
- Culture and Tourism
- Environment and Climate Change
Funds Allotment for FY 21
Agriculture: 16 points Action plan to double Farmers income by 2022.
- Encourage states that pass agriculture model laws.
- Comprehensive measures for 100 water-stressed districts.
- A village storage scheme is being proposed, to be run by self-help groups.
- Balanced use of fertilizers
- Farmers' dependence on diesel removed by PM Kisan Scheme
- NABARD to geotag cold storage and warehousing.
- Kisan Rail for transporting perishable goods
- Krishi Udaan scheme for national and international routes
- ‘One district one produce’ – Move towards promoting horticulture
- Portal on Jaivik Khetia will be strengthened
- Agri credit for the fiscal set at Rs 15 lakh crore
- Financing of e-warehousing
- Focus on eliminating diseases affecting livestock
- Fish production to be raised to 2 lakh tonnes
- Doubling of milk capacity to 108 mt tonnes
- Sagar Mitra Scheme to encourage fisheries.
- Rs 1 lakh Crore push for education
- Rs 99,300 crore outlay for education sector in 2020-21 and Rs 3,000 crore for skill development
- Govt propose National Police University and National Forensic University
- With the largest working population, steps to ensure education for all
- An allocation of Rs 8,000 crore for National Mission on Quantum
Water And Sanitation:
- Action plan to ease India's water problems starts with helping 100 districts
- Govt proposes Rs 3.6 lakh crore towards piped water supply to households
- Allocation for Swachh Bharat for 2020-21 stands at Rs 12,300 crore
Health Care:
- Govt to expand Mission Indra Dhanush, add hospitals to Ayushman Bharat
- Allocated Rs 69,000 crore to Healthcare, inclusive of Rs 6,400 crore for Jan Arogya Yojana
- Hospitals will open in tier 2 and tier 3 cities covered under Aspirational districts scheme which still do not have Ayushman - empanelled hospital
- Proceeds from taxes on medical devices will be used for this vital health infrastructure
- The government has aimed at spending target of 2.5 per cent of GDP till 2025
- FM makes entrepreneurs' lives easier with new investment clearance cell
- National Logistics Policy will be revealed soon to make MSMEs more competitive
- Govt plans to boost manufacturing of mobile phones, electronic equipment
- Single investment clearance window to be set up for promoting entrepreneurship
- Govt to set up national recruitment agency for recruitment of non-gazetted posts
- Amendments to be made to enable NBFCs to extend invoice financing to MSMEs
Infrastructure:
- Five new smart cities to be developed
- Rs 20,000 crore for the renewable energy sector
- Data as the new oil: Policy soon to enable private sector to build data centre parks
- Rs 6000 crore boost for internet connectivity
- Govt proposes Discoms replace conventional meters with smart pre-paid meters
- 5 archaeological sites to be developed with on-site museums
- Rs 1.7 lakh crore has been provided for transport infrastructure
- New infra road map to lend a cutting edge to flagship NIP scheme
- Outline a plan to invest Rs 1.05 lakh crore ($1.48 trillion) in infrastructure over the next five years
- A national logistics policy to be released soon
- A single window e-logistics market with focus on MSMEs
- Development of 2,500 km access-controlled highways and 2,000 km of strategic highways
- 12 lots of highway bundles spread over 6,000 km will be monetised before 2024
- Delhi-Mumbai Expressway to be ready in 3 years
- 6,500 new projects under NIP across sectors
- 1,150 trains will run under the public private partnership (PPP) mode
- Four stations will be redeveloped with the help of the private sector
- Indian Railways to set up a ‘Kisan Rail’ through Public-Private Partnership for farmers
- On the fast track: More Tejas-like trains between key stations
Tourism: Rs 2,500 Crore to boost tourism
Textile and Exports:
- Rs 1,480 Crore for National Textile Mission
- Nirvik (Niryat Rin Vikas Yojana) scheme to provide enhanced insurance cover and reduce premium.
- Enhance allocation of Rs 9000 Crore for senior citizens and 'Divyang’
- Rs. 4,400 Crore allocated for cities to ensure clean air
- Rs 53,700 Crore for welfare of schedule tribes
- Rs 85,000 Crore for welfare of SC and other backward classes
- Insurance cover increased to Rs 5 lakh per depositor
- Rs 100 crore allotted to prepare for hosting G20 presidency in 2022
- Allocation of Rs 30,757 crores for 2020-21 for Jammu and Kashmir and Rs 5,958 crores for Ladakh
- FY21 fiscal deficit target pegged at 3.5% of GDP
- Government will bring LIC IPO
- Government to sell part holding in LIC and IDBI Bank.
- Govt to sell govt stake in IDBI Bank to private investors
- FY21 divestment target pegged at Rs 2.1 lakh crore
- Certain specified categories of government securities will be open fully for NRIs
- Nominal GDP
growth for FY21 revised
to 10%
Highlights of Income Tax:
 |
| Income Tax Slab for Individual |
- New income tax rates will be optional
- FM proposed to remove the deeply unpopular dividend distribution tax(DDT)
- Concessional corporation tax rate for electricity generation cos in place
- Govt proposes 100 percent tax concession to sovereign wealth funds on investment in infra projects
- Housing becomes more affordable, gives tax holiday to affordable housing developers
- New power generation companies will have to pay just 15percent tax under the new corporate tax regime
- Govt proposes deferment of tax payment by employees on ESOPs from start ups by 5years
- Taxon Co-op societies to be reduced to22% plus surcharge, as against current 30%
- Govt extends additional Rs1.5 lakh tax benefit on interest paid on affordable housing loans to March2021
- FM proposes a scheme to bring down litigation indirect taxation scheme; 4.83 lakh direct cases pending in various appellate forums
- 'Vivad seVishwas' scheme for direct taxpayers whose appeals are pending at various forum
- Govt to launch system for instant allotment of PAN on basis of Aadhaar
- Health Cess on import of medical equipment imposed in Budget
- Long-term capital gains (LTCG) tax stays
Verdict: In my view, budget not very poor or good, its is an average budget. Government can do much better. Introduction of new tax regime is not healthy, I think confusion will be increased due to new tax regime.
Scrap age policy and other pending issues not addressed properly.
Sources:
Various publications
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