Key highlights from Modi govt. Budget 2020-21

TIL Desk Budget 2020/ Finance Minister Nirmala Sitharaman tables the Modi  govt’s Budget 2020-21.  Key Highlights from Budget 2020:

• With India facing the worst economic slowdown in more than a decade, Sitharaman is expected to pull out all stops to spur consumer demand and investment, government sources and economists said.  Committed to serve the people of India. People have given us their janaadesh. This is the budget to boost their income and enhance purchasing power: Sitharaman

• Our people should be gainfully employed, our businesses should be healthy, for all minorities, women and people from SCs and STs, this Budget aims to fulfill their aspirations.  As Finance Minister Nirmala Sitharaman begins her Budget speech, the benchmark Sensex, that gauge of market sentiment, has gone up by 110 points. GST has resulted in efficiency gains in transport and logistics sector, inspector raj has vanished, it has benefitted MSME.  Consumers have got an annual benefit of 1 lakh crore rupees by GST: Sitharaman

• I pay homage to visionary leader the late Arun Jaitley, the chief architect of Goods and Services Tax. GST has been the most historic of the structural reforms. GST has been gradually maturing into a tax that has integrated the country economically. 271 million people raised out of poverty between 2006 and 2016.  This Budget has 3 streams: 1. Aspirational India 2. Economic development for all 3. A caring society. Committed to doubling farmers income by 2022. Central government’s debt has come down to 48.7% in March 2019 from 52.2% in March 2014: Sitharaman

• Simplified return for GST is being introduced from April 2020. Sitharaman recites a verse in Kashmiri by Dinanath Kaul and translates it into Hindi, ‘Humara watan khilte hue Shalimar bagh jaise, humara watan Dal lake mein khilte hue kamal jaisa, naujawanon ke garam khoon jaisa, mera watan tera watan, humara watan, duniya ka sabse pyara watan’. Farm markets need to be liberalised, farming need to be made more competitive, handholding of farm-based activities need to be provided, sustainable cropping patterns and more tech needed: Sitharaman

• We have insured 6.11 crore farmers under Pradhan Mantri Fasal Bima Yojna. Our government is proposing comprehensive measures for 100 water-stressed districts in the country.  20 lakh farmers to be provided funds for setting up standalone solar pumps. Govt proposes 16-point action plan to boost agriculture and farmers welfare.Farmers who have fallow or barren land will be helped to set up solar power generation units and also sell surplus power to the solar grid and also make living out of even barren land: Sitharaman

• To build a seamless national cold supply chain for perishables, Indian Railways will set up Kisan Rail through PPP model so that perishable goods can be transported quickly. Krishi Udaan will be launched by MoCA on international and national routes. Balanced use of fertiliser will bring about change in prevailing regime of providing incentive for use of chemical fertiliser. Government proposes plans to help farmers use proper manure and little water, encourage balanced use of fertilizers. States asked to adopt 3 central model laws on agri land leasing. For sector comprising agriculture, allied activities, irrigation and rural development, an allocation of Rs 2.83 lakh crores has been made for 2020-21. Village storage schemes run by self help groups, will provide holding capacity for farmers, so women in villages can regain their status as ‘Dhaanya Lakshmi’: Sitharaman

• Comprehensive measures for 100 water-stressed districts being proposed in this budget; agricultural credit target has been set at Rs 15 lakh crore. Framework for the development, management and conservation of marine fishery resources to be put in place. Proceeds from taxes on medical devices would be used to  support setting up of hospitals. Anti-TB campaign to be launched to eliminate TB by 2025. Allocation of Rs 12,300 crores for Swachh Bharat Mission for year 2020-21. Centre to announce new education policy soon; government received over 2 lakh suggestions on it. Steps to be taken to attract external commercial borrowing, FDI in education sector: Sitharaman

• Entrepreneurship is the strength of India. I propose to set up an investment clearance cell that will provide end to end facilitation and support, including pre-investment advisory, info on land banks and facilitate clearance at state level.Rs 99,300 crore allocated for education sector, Rs 3,000  crore for skill development in FY21.Degree level full-fledged online education programme by  institutions ranked in top 100. Scheme focussed on encouraging manufacture of mobile phones, electronic equipment and semiconductor packaging to be introduced.A proposal is under consideration for setting up large solar panel capacity alongside the railway tracks on land owned by railways.  More Tejas type trains will connect iconic destinations. I propose to provide Rs 22000 crores to power and renewable energy sector in 2020-21. I propose to provide Rs 1.7 lakh crores for transport infrastructure in 2020-21, Rs 27,300 crore rupees for development of industry and commerce: Sitharaman

• To soon bring out a policy to enable private sector to build Data Centre Parks in the country. Will achieve seamless delivery of services through digital governance. National Logistics Policy will soon be released, creating single window. ‘Beti Bachao, Beti Padhao’ has yielded tremendous results, gross enrollment ratio of girls across all levels of education now higher than boys.  Rs 8,000 crore over five years to be provided for quantum technologies and applications. Fibre to home connections under BharatNet will be provided to 1 lakh gram panchayats this year itself, and Rs 6000 crore has been provided for BharatNet. Enhance allocation of Rs 9500 crores for senior citizens and ‘Divyang’.   I propose to provide Rs 35,600 crores for nutrition related programmes for 2020-21.I propose to provide Rs 2500 crores for promotion of tourism in the year 2020-21. Five archaeological sites to be developed as iconic sites with on-site museums — Rakhigarhi, Hastinapur, Shivsagar, Dholavira and Adichanallur: Sitharaman

• Govt allocates Rs 3,150 cr for ministry of culture, Rs 2,500 cr for ministry of tourism.  Rs  85,000 crore rupees allotted for Scheduled Castes and Other Backward Classes in 2020-21, and Rs 53,700 crore rupees for Scheduled Tribes. We wish to enshrine in the statutes a taxpayer charter through this Budget.  Our govt remains committed to taking measures to ensure that our taxpayers are free from tax harassment of any kind. In the wake of banks going under, Finance Minister Nirmala Sitharaman announced that the bank depositors insurance, which currently stands at Rs 1 lakh, has been enhanced to Rs 5 lakh. Balance govt holding in IDBI Bank to be sold to private retail investors. Government proposes amendments to facilitate the separation of government pension trust from PFRDA.Government proposes to sell a part of its holding in LIC by initial public offer. Certain govt securities will be open for foreign investors. Govt proposes to increase investment limit of FPIs in corporate bonds. Fiscal deficit pegged at 3.8 pc in current fiscal and 3.5 pc in next: Sitharaman

• Dividend Distribution Tax shifted to individuals instead of companies.Around 70 of more than 100 income tax deductions and exemptions have been removed, in order to simplify tax system and lower tax rates.Concessional withholding rate of 5 pc on interest payment to non-residents extended up to June 30, 2022.Government proposes 100 pc tax concession to sovereign wealth funds on investment in infra projects. Finance Minister Nirmala Sitharaman has unveiled new rates, increasing the slabs and offering less tax burden to the assessees, but with a catch.

• Budget proposes deferment of tax payment by employees on ESOPs from startups by five years.In order to promote affordable housing projects, I propose to extend date of approval of affordable housing projects for availing tax holiday by one more year. Option to be provided to cooperative societies to be taxed at 22% plus 10% surcharge and 4% cess, with no exemptions or deductions. Cooperative socieities to be exempted also from Minimum Alternative Tax.Income of charitable institutions fully exempt from taxation; Donation to such institutions allowed as deduction in computing taxable income of donor. Start-ups are engine of growth. Propose to increase turnover limit for startups from Rs 25 crores to 100 crores.Turnover threshold for 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 in cash: Sitharaman

• Vivad se Vishwas’ scheme for direct tax payers whose appeals are pending at various forums.Income Tax Act to be amended to allow faceless appeals against tax orders on lines of faceless assessment.Customs duty on footwear, furniture raised. Finance Minister Nirmala Sitharaman winds up her Budget speech after 2 hours 40 minutes, the longest ever by a finance minister, with 2 more pages still to go.Finance Minister Nirmala Sitharaman on Saturday announced increasing customs duty on imported footwear and furniture. She also raised excise duty by way of national calamity contingent duty on cigarettes, tobacco products.