The key highlights of the Budget documents are as follows:

  • Taxation
    • Tax Slab
Income range per annumFinancial Year 2020-2021Financial Year 2019-2020
Taxable Income SlabTax RatesTax Rates
Below 2.5 lakhsNo TaxNo Tax
2.5-5 lakhs5%5%
5-7.5 lakhs10%20%
7.5-10 lakhs15%20%
10-12.5 lakhs20%30%
12.5-15 lakhs25%30%
Above 15 lakhs30%30%
Rebate under section 87(A)100% tax rebate subject to a maximum of Rs. 2,500 available to resident individuals whose total income does not exceed Rs. 3.5 lakhs100% tax rebate subject to a maximum of Rs. 2,500 available to resident individuals whose total income does not exceed Rs. 3.5 lakhs

Also, to simplify the tax system, 70 out of more than 100 tax exemptions and deductions have been removed.

  1. Companies are not required to pay DDT, now it will be taxed only at the hands of recipients.
  2. The cash reward system envisaged incentivizing customers to seek invoices.
  3. 15% concessional tax rate for new power generation companies.
  4. Tax on cooperative societies reduced to 22% without exemptions.
  5. 100% tax concession to sovereign wealth funds on investment in infrastructure projects.
  6. Tax on Cooperative societies to be reduced to 22 per cent plus surcharge and cess as against 30 percent at present.
  7. Tax holiday for affordable housing extended by 1 year. Additional deduction up to Rs. 1.5 lakhs for interest paid on loans taken for an affordable house extended till 31st March 2021.
  8. Govt plans to sell part of its holding in Life Insurance Corporation (LIC) by way of Initial Public Offering.
  9. FPI limit in corporate bonds raised to 15% from 9%.
  10. The government doubles the divestment target for the next fiscal at Rs 2.1 lakh crore.
  11. Customs duty raised on footwear to 35% from 25% and on furniture goods to 25% from 20%.
  12. Excise duty proposed to be raised on Cigarettes and other tobacco products, no change made in the duty rates of bidis.
  13. Basic customs duty on imports of newsprint and light-weight coated paper reduced from 10% to 5%.
  14. 5% health cess to be imposed on the imports of medical devices, except those exempts from BCD.
  15. Lower customs duty on certain inputs and raw materials like fuse, chemicals, and plastics.
  16. Higher customs duty on certain goods like auto-parts, chemicals, etc. which are also being made domestically.
  • Startups & MSME
    1. The tax burden on employees due to tax on ESOPs to be deferred by five years or till they leave the company or when they sell, whichever is earliest.
    2. New Simplified return for GST from April 2020
    3. Start-ups with turnover up to Rs. 100 crores to enjoy a 100% deduction for 3 consecutive assessment years out of 10 years.
    4. The turnover threshold for the audit of MSMEs to be increased from Rs 1 crore to Rs 5 crore, to those businesses which carry out less than 5% of their business.
  • Fiscal numbers & allocations
    1. FY20 fiscal deficit revised to 3.8% from 3.3% in the current fiscal. For FY21, the fiscal target seen at 3.5%.
    2. Net market borrowing for FY20 at Rs 4.99 lakh crore; For FY21 it’s pegged at Rs 5.36 lakh crore.
    3. The nominal GDP growth for 2020-21 estimated at 10%.
    4. Receipts for 2020-21 estimated at Rs 22.46 lakh crore. Expenditure at Rs 30.42 lakh crore.
    5. Defense gets Rs 3.37 lakh crore as the defense budget.
    6. Rs 2.83 lakh crore to be allocated for the 16 Action Points; Rs 1.6 lakh crore allocated to agriculture and irrigation; Rs 1.23 lakh crore for Rural Development and Panchayati Raj.
    7. Rs 4,400 crore for clean air; Rs 53,700 crore for ST schemes; Rs 85,000 crore for SC, OBCs schemes; Rs 28,600 for women specific schemes; Rs 9,500 crore for senior citizen schemes.
    8. Rs 30,757 crore rupees for Union Territory of J&K; Rs 5,958 crore rupees for Union Territory of Ladakh.
  • Banking
    1. To help bank depositors, the government increases depositor insurance to Rs 5 lakh from the current Rs 1 lakh.
    2. Banking Regulation Act to be amended to strengthen Cooperative banks.
  • Jobs
    1. National recruitment agency: New common entrance tests for non-gazetted government jobs and public sector banks.
    2. Special bridge courses to be designed by the Ministries of Health, and Skill Development: To fulfill the demand for teachers, nurses, para-medical staff and caregivers abroad.
    3. Urban local bodies to provide internships for young engineers for a period of up to one year.
  • Infrastructure
    1. 5 new smart cities to be set up via the PPP model.
    2. Rs 1.7 lakh crore allocated to transportation.
    3. 100 more airports to be set up by 2024 to support the UDAN scheme.
    4. Accelerated development of highways will be undertaken; Delhi-Mumbai expressway and two other projects to be completed by 2023. Chennai-Bengaluru Expressway to be started.
    5. NHAI to monetize 12 lots of highway bundles of over 6,000 km before 2024.
    6. About Rs 22,000 crore already provided for supporting National Infrastructure Pipeline.
    7. Investment Clearance Cell to set up through a portal will provide end-to-end facilitation, support, and information on land banks
    8. National Logistics Policy will soon be released, creating a single window e-logistics market
  • Tourism
    1. 5 archaeology sites to be developed for world-class museums
      • Rakhigarhi (Haryana)
      • 2. Hastinapur (Uttar Pradesh)
      • 3. Shivsagar (Assam)
      • 4. Dholavira (Gujarat)
      • 5. Adichanallur (Tamil Nadu)
    2. Rs 2,500 crore for tourism promotion
    3. An Indian Institute of Heritage and Conservation under Ministry of Culture proposed; with the status of a deemed University.
    4. 4 more museums from across the country to be taken up for renovation and re-curation.
    5. Rs.3150 crore proposed for the Ministry of Culture for 2020-21.
    6. Maritime Museum to be set up at Lothal- the Harrapan age maritime site near Ahmedabad, by the Ministry of Shipping.
  •  Telecom
    1. Rs 6,000 crore for BharatNet program; Fibre to Home connections under BharatNet will be provided to 1 lakh gram panchayats this year itself
    2. New policy for the private sector to build Data Centre Parks.
  • Energy
    1. Expansion of National Gas Grid from 16,200 km to 27,000 km along with reforms to deepen gas markets, enable ease of transactions and transparent price discovery
    2. Rs 22,000 crore allocated to power and renewable energy.
    3.  Advise to shut thermal plants if they don’t meet emission norms.
  • 5 measures for Railways:
    1. Large solar power capacity to be set up alongside rail tracks, on land owned by Railways
    2. More Tejas-like trains for tourists.
    3. 150 new trains to be introduced on a PPP basis; Four stations will also be redevelopment with the help of PPP.
    4. Rs 18,600 crore worth Bengaluru suburban transport project launched; 20% equity will be provided by the Centre.
  • Education
    1. Rs 99,300 crore allocated for the education sector, Rs 3,000 crore rupees for skill development
    2. External commercial borrowings and FDI to be leveraged to improve the education system.
    3. A medical college to be attached to a district hospital in PPP mode, viability gap funding to be set up for setting up such medical colleges.
    4. New Education Policy to be announced soon.
    5. 150 higher educational institutions to start apprenticeship embedded degree/diploma courses by March 2021.
    6. To launch 2 new National science schemes
    7. National Police University and National Forensic Science University proposed for policing science, forensic science, and cyber-forensics.
  • Agriculture
    1. Agriculture market needs to be liberalized; govt proposes to handhold farmers
    2. Comprehensive measures for 100 water-stressed districts being proposed
    3. PM KUSUM scheme will be expanded to 20 lakh farmers.
    4. Another 15 lakh farmers to be helped to solarise their grid-connected pump sets.
    5. Scheme to enable farmers to set up solar power generation capacity on their fallow/barren lands and to sell it to the grid.
    6. Change in incentive scheme for chemical fertilizers.
    7. Krishi UDAN scheme for agricultural exports on international and national routes.
    8. Railways will set up Kisan Rail through PPP arrangement, for transportation of perishable goods.
    9. For better marketing and export, supporting states will focus on one product for one district, so that high focus is given at district level for horticulture to gain momentum
    10. Zero Budget farming focus of the government.
    11. MGNREGS to be used to develop a fodder farm.
    12. Jaivik Kheti Portal – online national organic products market to be strengthened.
  • Healthcare
    1. Rs 69,000 crore allocated to the healthcare sector.
    2. Rs. 6400 crore (out of Rs. 69,000 crores) for PM Jan Arogya Yojana (PMJAY
    3. A new scheme to provide higher insurance cover, the reduced premium for small exporters and simplified procedure for claims

Source: https://economictimes.indiatimes.com/

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