Wednesday, August 10, 2022

No change in Income Tax slabs; PM Gati Shakti catches eye: Budget

Finance minister Nirmala Sitharaman presented her fourth Union budget on Tuesday and said India could grow at 9.27% in the coming year. 

She focussed on four pillars of inclusive development, productivity enhancement, energy transition and PM Gati Shakti and said it’s a blueprint of the economy from India at 75 to India at 100. 

“PM Gati Shakti is a transformative approach for economic growth and sustainable development. The approach is driven by seven engines namely roads, railways, airports, ports, mass transport, waterways and logistics infrastructure. All seven engines will pull forward the economy in unison. These engines are supported by the complementary roles of energy transmission, IT communication, bulk water and sewerage and social infra,” she said.

She added, “Projects in National infrastructure pipeline which pertain to seven engines will be aligned with PM Gati Shakti Framework. Touchstone of the master plan will be world-class modern infra, logistics synergy among different modes of movement and location of projects.”

“PM Gati Shakti Master Plan for Expressways to be formulated in 2022-23, to facilitate faster movement of people and goods. She said that the National Highway network to be expanded by 25,000 km in 2022-23. “Rs. 20,000 crore to be mobilized to complement public resources,” FM Sitharaman said.

The Finance Minister said that this Union Budget seeks to lay the foundation and give a blueprint of the economy over ‘Amrit Kal’ of next 25 years – from India at 75 to India at 100.

She said that India’s Azadi ka Amrit Utsav will focus on complementing micro and macro economy, promoting digital economy, and private and public investments.

After Sitharaman. Had concluded her budget speech, the Sense surged by 879 points while Nifty rose by 234 points. 

Key takeaways from the finance minister’s speech: 

* Govt to pay Rs 2.37 lakh crore towards procurement of wheat and paddy under MSP operations;

* Kisan Drones for crop assessment, land records, spraying of insecticides expected to drive a wave of technology in agri sector;

* Rs 6,000 crore program to rate MSMEs to be rolled out over 5 years;

* Startups will be promoted for Drone Shakti;

* 1-Class-1-TV Channel to be implemented to provide supplementary education to children to make up for the loss of formal education due to Covid;

* Digital university to be set up to provide education; to be built on the hub and spoke model;

* PM Gati Shakti for road transport masterplan to be finalized in 2022-23;

* 2022-23 has been announced as the International Year of Millets;

* Railways will develop new products for small farmers and MSMEs;

* Contracts for multi-modal parks at 4 locations to be awarded next fiscal;

* ECLGS scheme to be extended till March 2023 and guarantee cover expanded by Rs 50,000 to Rs 5 lakh cr;

* 400 new generation Vande Bharat trains with better Energy Efficiency and passenger riding experience to be manufactured in next three years;

* Emergency Credit Line Guarantee Scheme (ECLGS) will be extended up to March 2023;

* The guaranteed cover will be expanded by Rs 50,000 crores to a total cover of Rs 5 lakh crores;

* Issuance of E-passports will be rolled out in 2022-23 to enhance convenience for  citizens;

* PM development initiatives for North East will be implemented for the North Eastern Council. This scheme is not a substitute for the existing Centre or State schemes;

* 80 lakh affordable houses will be completed at Rs 44,000 cr under PM Awas Yojna in 2022-23;

* 75 digital banks in 75 districts will be set up by scheduled commercial banks to encourage digital payments

* All post offices to be linked with Core Banking Solution to push financial inclusion

* A high-level panel to be set up for urban planning;

* E-passport with embedded chip will be rolled out;

* Modern building by-laws will be introduced;

* 75,000 compliances have been eliminated and 1,486 union laws repealed to make it easier for businesses;

* Battery swapping policy to allow EV charging stations for automobiles will be framed;

* A completely paperless, e-bill system will be launched by ministries for procurement;

* 5 existing academic institutions for urban planning to be designated as Centre for Excellence with endowment fund of Rs 250 cr;

* Voluntary exit for corporates to be cut down to 6 months from 2 years;

* Spectrum auction will be conducted to roll out 5G mobile services within 2022-23 by private firms;

* 68 percent of capital for defense sector to be earmarked for local industry;

  • Contracts for laying of optical fibre net to all villages under BharatNet to be provided under PPP mode;
  • * Rs 19,500 cr additional allocation for PLI for manufacturing high efficiency solar modules has been made;

* 4 pilot projects for coal gasification are to be set up;

* Financial support will be provided to farmers to take up agro-forestry;

* Outlay for capital expenditure stepped up 35.4 pc to Rs 7.5 lakh crore in FY’;

* Effective capital expenditure will be Rs 10.68 lakh crore, or 4.1 pc of GDP, in 2022-23;

* Sovereign green bonds to be issued to mobilise resources as part of govt’s borrowing programme;

* PE/VC invested Rs 5.5 lakh crore in startup, expert committee will be set up to suggest measures to help attract investment;

* Proposed to introduce Digital Rupee by RBI using blockchain technology, starting 2022-23;

* Rs 1 lakh crore financial assistance to states to be provided in 2022-23 to catalyse investments;

* In 2022-23, states will be allowed fiscal deficit of up to 4 pc of GSDP;

* Fiscal deficit at 6.9 per cent of GDP in 2021-22, 6.4 per cent in 2022-23;

* Total expenditure in FY23 estimated at Rs 39.45 lakh cr; total resources mobilisation to be Rs 22.84 lakh cr other than borrowing:

* New provision to allow taxpayers to file an updated return within 2 years from the end of the relevant assessment year;

* Alternate minimum tax to be reduced to 15% for cooperative societies;

* Propose to increase tax deduction limit to 14% on employers contribution to NPS account of state govt employees;

* Tax incentives for startups to be incorporated until March 31, 2023;

* Reduce of surcharge of cooperative societies from 12% to 7% for those having income below 1 crore;

* Virtual digital assets to be taxed at 30% and 1 % TDS on transfer of virtual digital assets;

* GST revenues are buoyant despite the pandemic, gross GST collection for month of January are over Rs. 1.4 lakh crore. The highest since the inception of GST

* Customs duty on cut polished diamonds, gems to be reduced to 5%;

* No change in the Income Tax Bracket for tax-paying individuals;

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