Budget 2019-20: Highlights and Tax Slab

The Modi government today submitted the Union Budget 2019-20 after a pre-election populist budget in February 2019 to increase infrastructure and foreign investment at a moment when the economy is showing signs of a slowdown.

Taking a pragmatic strategy, Finance Minister Nirmala Sitharaman today announced no adjustments to personal income tax rates, but a surcharge was levied on the super wealthy. She also attempted to boost development by reducing corporate tax and sops to the housing, start-ups and electric vehicles sectors.

Sitharaman said that digital payments will become cheaper, govt will launch an ATM-like One Nation One Card for pan-India travel, and fresh model rental legislation will be introduced to increase affordable housing.

Here are all the major points from the speech of the Finance Minister

Taxes:

No change in rates of personal income tax.
Additional Rs 1.5 lakh tax relief on home loan to buy a house up to Rs 45 lakh.
Custom fuel hike by 1 rupee, gold and valuable products ; petrol & diesel to get more expensive.
3% surcharge on Rs 2 crore revenue; 7% on Rs 5 crore and above.
Corporate tax with revenue of up to Rs 400 reduced from the present 30% to 25%.
PAN and ITR Aadhaar interchangeability for those without PAN cards.
The GST Council recommends reducing the tax rate on EVs from 12% to 5%.
On tiles, cashew kernels, vinyl flooring, auto parts, some synthetic rubber, digital and video recorder and CCTV camera, duties have been increased.

Affordable housing:

Democratic rental laws. To promote house renting, modern tenancy policy will be shared with countries.

To promote digital payments:

2% TDS on the annual withdrawal of Rs 1 crore from your company payment bank account.

No electronic payment fee: MDR fees for cashless payment refunded.

Living convenience:

NRIs Aadhaar card upon arrival in India.

Rs 3,000 monthly pensions for informal sector employees

Transportation

Interoperable One Nation One transportation card: ATM-like universal transportation card on different modes of transportation (metro, highway, rail, etc.).
Govt plans to establish the manufacturing, repair and operating industries of MRO.
PPP to be used to develop and deliver passenger freight services more quickly.
A comprehensive restructuring of the National Highways Grid Development Program.
Government plans to use rivers to decontaminate highways and railways

Economy:

Fiscal deficit of 3.3% of GDP in FY 19.
Govt will begin to raise some foreign currency borrowing.
Govt’s external GDP debt is one of the world’s lowest.

Women empowerment:

Nari tu Narayani: Women SHG Interest Subsidy Program to expand to all Indian districts.
Rs 1 lakh loan to be granted to employees of SHG females.
Rs 5,000 rupees overdraft facility can be used by every verified female SHG member with a Jan Dhan account.

Banking reform:

Govt will provide one-time 6-month loan guarantee when purchasing high-rate pooled NBFC assets amounting to Rs 1 lakh crore in this FY.
Proposal to provide PSU banks with Rs 70,000 crore capital.
HFC (Housing Finance Cos) regulation to transfer from the National Housing Bank to RBI.

Divestment:

Aim to revise this policy of maintaining 51% interest in PSUs.
Continue to strategically divest selected CPSEs.
Rs 1.05 lakh crore target for FY 20.

Railways:

A fresh model of PPP will introduce Indian railways to fresh dawn.
Railways should be urged to invest more through SPVs in the suburban rail network.
Railways will need Rs 50 lakh crore investment between 2018 and 2030.
Massive railway station upgrade program to be introduced in 2019.

MSME:

Proposal for startups to limit angel tax.
Angel tax: The I-T department will not require scrutiny for start-up.
2% interest subsidy on new or incremental loans for GST-registered MSMEs.
The scheme’ Stand Up India’ to proceed until 2025.
New start-up television channel.
Pension advantage expanded to retail traders with less than Rs 1.5 crore annual turnover.
Creation of a new payment platform for MSMEs.

Education:

Govt to launch the program ‘ Study in India’ to attract higher education learners from abroad.
Allocate Rs 400 crore to higher education organizations of world class in the 20th financial year.
Unveiling a fresh policy on education.
National Research Foundation to finance, coordinate and encourage country-wide research.
New Commission for Higher Education focusing on greater autonomy.
New domestic education policy for the school and higher education modifications.

Tourism:

17 to be created iconic world-class tourist sites. FDI:
Local supply standards for the single-brand retail industry will be relaxed.

Investment:

Rationalization and simplification of existing KYC standards for FPIs to make it more investor-friendly.
Market long-term bonds.
Enabling FIIs & FPIs to invest in NBFC debt securities.
Credit Guarantee Enhancement Corporation to establish long-term bonds focusing specifically on the infra-sector.
Propose SEBI Social Stock Exchange to list social enterprises and voluntary organizations.
Open FDI in the fields of aviation, insurance, AVGC animation and media.
A fusion of portfolio path NRI with route FPI.
In some businesses, the statutory limit for foreign investment should be increased.
Setting up a corporation to enhance loan guarantee.
Govt will take action to interoperate RBI & SEBI depositories.
SEBI to mull from 25% to 35%, increasing the minimum government shareholding.
User friendliness of corporate bond trading platforms, including problems resulting from International Capping, will be assessed and Number of identification of securities.
Deepening the three-party corporate repo market for corporate debt securities. Plan to allow inventory exchanges to provide collateral for AA-rated bonds.
Annual Global Investor Meeting to attract worldwide players to come to India to invest.
To enable FPIs to subscribe to REITs ‘ listed debt documents.

Automotive industry:

The FAME II scheme aims at promoting quicker electric vehicle adoption through the correct incentives and charging infrastructure.

For Rural India:

our government’s focus is on Gaon, Garib and Kisan.
The ministry of New Jal Shakti will work with nations to secure Har Ghar Jal for all rural buildings by 2024.
Phase 3 of Pradhan Mantri Gram Sadak Yojana is planned to increase the length of 1,25,000 km over the next 5 years.
Govt is setting up 100 fresh clusters in FY 20 for 50,000 craftsmen.
Invest Rs 80,250 cr under PM Gram Sadak Yojana to upgrade highways.
All rural families, except those reluctant to have electricity by 2022.

Agriculture:

Promoting innovative zero Budget agriculture.
10,000 fresh organizations producing farms.
80 Livelihood business incubators and 20 technology business incubators to be set up under ASPIRE in 2019-20 to create 75,000 qualified agro-rural entrepreneurs.

Space:

India arose as a significant force in space. It’s time to commercially exploit our capacity.
New Space India Limited (NSIL) was integrated into ISRO’s tap advantages.

Sports:

The National Sports Education Board is set up under ‘ Khelo India ‘ to popularize sports at all levels.

Economic state:

Railways will involve Rs 50 lakh crore investment from 2018-30 onwards.
Schemes like Bharat Mata, Sagarmala and UDAN bridge the urban divide of rural areas and improve our transport infrastructure.
Gandhipedia’ is being created to appreciate the beneficial Gandhian values of young people.
In the latest election, the people’s unambiguous mandate set the ball rolling for New India.
In the last four years, NPAs recover Rs 4 lakh crore, NPAs down Rs 1 lakh crore in the last one year.
The inauguration of Rashtriya Swachhta Kendra in Rajghat on 2 October.
The Indian people have confirmed their two objectives for the future of our country: national security and economic growth.
Yakeen ho to koi raasta niklata hai, hawa ki awt(protection) bhi le kar chiragh jalta hai’.
It took us more than 55 years to achieve a $1 trillion economy, but in just 5 years we added $1 trillion.
In the next few years, we could very well achieve $5 trillion.
Last mile delivery stood out, people felt the distinction in every corner of the nation; our goal was and continues to be Mazbooth Desh Ke Liye Mazbooth Nagarik.
The government sets out a 10-point New India vision.
This year, India will become an economy of $3 trillion. To attain a financial objective of $5 trillion, we need to continue taking many structural reforms.
Connectivity is the economy’s lifeline.

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