The Budget focused on raising the purchasing power by cutting income tax rates and boosting rural income.
The Statistics
Between 2006-2016, 271 million are out of poverty and we should be proud of it
Country has moved on from over 4 per cent growth in 1950s to 7.4 per cent to 2014-19 period
Total of 60 lakh new taxpayers and 105 crore e-way bills generated under GST. Average household now saves 4 percent of monthly spend due to reduced GST rates
Central government debt reduced to 48.7 per cent of GDP in 2019 from 52.2 per cent.
Over 6 crore farmers under Pradhan Mantri Fasal Bima Yojna have been insured.
Key Announcements:
India is now 5th largest economy in world – put out a 16-point guide to make India an aspirational economy
Government to incentivise farmers to go solar.Pradhan Mantri Kisan Urja Suraksha and Utthan Mahabhiyan (PM KUSUM) to be expanded, providing 20 lakh farmers in setting up standalone solar pumps.
Railways will set up Kisan Rail through PPP model so that perishable goods can be transported quickly. Krishi Udaan scheme to transport agri products to national as well international destinations to be launched.
Agri-credit target for the year 2020-21 has been set at Rs 15 lakh crore.
Rs 69,000 crores for allocated for the healthcare sector
Education and training: Rs 99,300 crore allocated for education in FY21. Govt will start start Ind-Sat Exam to promote study in India and a degree-level online education programme for the deprived. A total of Rs 3,000 crore will be given for skill development.
Allocation for Swachh Bharat Mission for 2020-21 stands at Rs 12,300 crore. In further push to PM Modi’s ‘Nal se jaal’ scheme, govt proposes Rs 3.6 lakh crore towards piped water supply to households.
National Textile Mission to be launched with a proposed Rs 1,480 crore allocation
To boost infrastructure, 9,000 km of economic corridor will be set up. Chennai-Bengaluru expressway will also be started. Delhi-Mumbai expressway to be completed by 2023
550 WiFi facilities have been commissioned at railway stations. 1 lakh gram panchayats to get optical fibre link. An allocation of Rs 6,000 crore will be provided for BharatNet scheme.
Allocation of Rs 27,300 crore for development of industry and commerce.
Rs 20,000 crore announced for renewable energy sector in a bid to tackle pollution and climate change. A new scheme of smart meters will be launched.
100 more airports to be developed by 2025. 1,150 trains will run under the public private partnership (PPP) mode, also four stations will be redeveloped with the help of the private sector. Besides, the Tejas type trains to connect tourist destinations.
An allocation of Rs 8,000 crore will be made for National Mission on Quantum Computing and Technology.
Rs 35,600 crore allocated for nutritional related programme in FY21 while Rs 85,000 crore has been budgeted for the welfare of Scheduled Castes and other backward classes. Tourism promotion gets Rs 2500 crore.
Women schemes, senior citizens in Budget: Enrolment ration for girls under ‘Beti Bachao Beti Padhao‘ is higher than boys. Gross enrollment of girls is 94.32 per cent in elementary levels, 81.32 per cent in secondary level and 59.7 per cent in higher secondary level. Further, Rs 28,600 crore will be allocated in FY21 for women-linked programmes. Allocation for senior citizens and ‘Divyang’ enhanced to Rs 9500 crore.
Proposed 4,400 crore to tackle Delhi’s air pollution problem. Last year, the Supreme Court had termed the situation as “worse than Emergency” as air quality dipped to hazardous levels.
Insurance cover for bank depositors raised from Rs 1 lakh to Rs 5 lakh. Currently, in the (unlikely) event of a bank going bust in India, a depositor has claim to a maximum of Rs 1 lakh per account as insurance cover — even if the deposit in their account far exceeds Rs 1 lakh. Depositors holding more than Rs 1 lakh in their account have no legal remedy in case of the collapse of the bank.
Foreign direct investment (FDI) into the country has increased to $284 billion during 2014-19 from $190 billion in previous five years.
Nirvik (Niryat Rin Vikas Yojana) scheme to provide enhanced insurance cover and reduce premium for small exporters.
Focus on MSMEs: More than 5 lakh MSMEs benefited from RBI’s restructuring of loans. Government has asked RBI to consider extending window of debt structuring by one year to March 2021 for this purpose
Fiscal deficit target pegged at 3.8% of GDP for FY 2019-20. FY21 fiscal deficit target pegged at 3.5% of GDP. Fiscal deficit is considered the most important marker of a government’s financial health.
Government to sell part holding in LIC. Besides, govt to also sell stake in IDBI Bank to private investors. The government’s move is a part of efforts to push through an aggressive disinvestment and asset monetisation programme.
Nominal growth of GDP for 2020-21 has been estimated at 10 per cent
Proposed a new simplified tax regime soon
10% tax for income between 5 lakh-7.5 lakh
15% tax for income between 7.5 lakh to 10 lakh
20% tax for income between 10 lakh to 12.5 lakh
25% tax for income between 12.5 lakh to 15 lakh
30% tax for income above 15 lakh
No income tax for those with taxable income below Rs 5 lakh
Dividend Distribution Tax to be removed. Dividend shall be taxed at the hands of the recipients
To boost investments and shore up the lagging economy, corporate tax for existing companies slashed to 22 per cent. Govt proposes 100 per cent tax concession to sovereign wealth funds on investment in infra projects. Moreover, concessional tax rate of 15 per cent extended to power generation companies.
Extends additional Rs 1.5 lakh tax benefit on interest paid on affordable housing loans to March 2021. In another boost, a proposed tax holiday to affordable housing developers.
‘Vivad se Vishwas’ scheme announced by Sitharaman for direct tax payers whose appeals are pending at various forum. 4.83 lakh direct cases pending in various appellate forums. Under the scheme, taxpayer to pay only amount of disputed tax. They will get complete waiver on interest and penalty if scheme is availed by March 31, 2020.
15th Finance Commission has cut state share of central taxes by one percentage point to 41 per cent.
