FM Niramala Sitharaman proposed a new optional personal income tax system and announced multi-billion dollar farm, infra, and a healthcare package to revive growth in the country, on Saturday.
Emphasising on capacity building and empowerment of marginalised sections of the society while protecting the wealth creators, Sitharaman said this Budget will boost income and purchasing power of the people. Finance minister also raised the bank depositors insurance coverage to Rs 5 lakh from Rs 1 lakh.
Table of Contents
Budget 2020 Taxation
|Taxable income slabs||Tax rates|
|Up to Rs 5 lakh||Nil|
|Rs 5 Lakh to Rs 7.5 Lakh||10%|
|Rs 7.5 lakh to Rs 10 lakh||15%|
|Rs 10 lakh to Rs 12.5 lakh||20%|
|Rs 12.5 lakh to Rs 15 lakh||25%|
|Rs 15 lakh and above||30%|
* To simplify the tax system and lower tax rates, around 70 of more than 100 income tax deductions and exemptions have been removed.
* Dividend Distribution Tax (DDT) abolished; Companies will not be required to pay DDT; dividend to be taxed only at the hands of recipients, at applicable rates.
* Cash reward system envisaged to incentivise customers to seek invoice.
* 15% concessional tax rate for new power generation companies.
* Tax on cooperative societies reduced to 22% without exemptions.
* 100% tax concession to sovereign wealth funds on investme ..
* Tax on Cooperative societies to be reduced to 22 per cent plus surcharge and cess ,as against 30 per cent at present.
Financial Bill Budget 2020
As the house curtailed its sittings in the wake of Coronavirus Outbreak, Lok Sabha passed the Financial Bill 2020 on 23 March 2020, without any discussion. Rajya Sabha Chairman M. Venkaiah Naidu and Lok Sabha Speaker Om Birla met political leaders to strike a deal to clear the important bill before Parliament was adjourned.
Minister of State for Parliamentary Affairs Arjun Ram Meghwal said it was an “extraordinary situation” and that a decision to pass the Bill without any discussion was taken at the all-party meeting.
The key changes introduced in the Bill are:
- NRIs – Non-Resident Indians will be taxed on India-controlled income above ₹1.5 million (US$21,000).
- Equalisation levy of 2% on non-resident e-commerce unless they have a PE in India.
- Exemption in tax to Sovereign Wealth Fund enlarged to Pension Funds for infra investment.
- Tax on cash withdrawal of over ₹2 million (US$28,000) at the rate of 2% if tax return not filed for three years with effect from 1 July 2020.
- TDS rate on payment of dividend to non-resident, foreign company at 20 percent with effect from 1 October 2020.
- DDT exemption will be given to REITs and InvITs if not under the new corporate tax regime.
- No 2 percent tax on withdrawal of over ₹10 million (US$140,000) cash from banks, co-operative banks, PO.
- Tax on cash withdrawal of over ₹10 million (US$140,000) at 5 percent if tax return not filed for three years with effect from 1 July 2020.
2021-2022 Union budget of India
In the current consolidated deduction of Rs 1.5 lakh is allowed on all long term and short term serving instruments, including provident fund, pension funds, and equity linked savings scheme etc.
The salaried class expects that FM could increase the bracket with upto Rs 2 lakh, an increase of Rs 50,000. Exemption limits of allowances such as children education allowance, transport allowance, medical allowance etc are very low. So expectations are that the allowances exempted from tax are increased along with rise in exemption limits under Sections 80C.
Que. Where to watch Union Budget 2021?
Ans:- The Budget 2021 will be telecast LIVE on Lok Sabha TV.
Que:- What was the theme of the Union Budget 2021?
Ans:- The theme of this year’s budget will largely circle around Covid-19, economic recovery and growth. As part of the central theme, the government is expected to focus on demand and job creation through targeted schemes and incentives.
Que:- What will be the budget 2020?
Ans:- Budget 2020 will be presented by the Finance Minister Nirmala Sitharaman in the Parliament. What is making Budget 2020 challenging? … Since the economic growth has stalled to just 5% in the current FY, all eyes will be on Nirmala Sitharaman on the day of the Union Budget 2020.
Que:- From when is the new budget applicable?
Ans:- The union budget for FY 2020 is scheduled for presentation on 1 February 2020.
Que:- What are the 3 types of budgets?
Ans:- Depending on the feasibility of these estimates, Budgets are of three types — balanced budget, surplus budget and deficit budget.
Que:- When will the Economic Survey be presented?
Ans:- The Economic Survey 2020-21 will be tabled in the Parliament on Friday, January 29, 2021, by Finance Minister Nirmala Sitharaman, two days before the Union Budget gets presented. Generally, the Economic Survey is presented on the opening day of the Budget Session and provides a summary of annual economic development across the country during the financial year.
₹99,300 crore for education sector in 2021 and about ₹3,000 crore for skill development.
Urban local bodies to provide internship to young engineers for a year.
Degree-level full fledged online education programmes by institutions ranked in top 100 in NIRF rankings, especially to benefit underprivileged students.
A national police university and a national forensic science university is proposed to be setup.
IND SAT exam for students of Asia and Africa to promote “study in India” programme.
Budget proposes to provide ₹1.7 lakh crore for transport infrastructure in 2021
National Logistics Policy to be released soon.
Chennai-Bengaluru Expressway to be started.
Aim to achieve electrification of 27,000 km of lines.
Plan to have a large solar power capacity for Indian Railways.
The government also proposes a Bengaluru suburban rail project at a cost of ₹18,600 crore.
Govt to monetise 12 lots of national highways by 2024.
100 more airports will be developed by 2024 to support UDAN.