New Delhi: The maiden budget presented by India’s first full-time woman Finance Minister Nirmala Sitharaman on Friday, June 5 is surely a pragmatic one, for it aims at boosting the infrastructure and foreign investment at a juncture of time when the Indian economy is manifesting signs of a slowdown.
Her key announcement are no changes in personal income tax rates, but an additional surcharge on the super-rich, digital payments will get cheaper, sops for the housing sector, start-ups etc.
The highlights are:
Taxes:
* No change in personal income tax rates
* Additional Rs 1.5 lakh tax relief on home loan for purchase of a house up to Rs 45 lakh.
* Custom duty hike on fuel by 1 rupee, gold and precious items; Petrol & diesel to get costlier.
* 3% surcharge on an income of Rs 2 crore; 7% on Rs 5 crore and above.
* Corporate tax with turnover of up to Rs 400 crore slashed to 25 per cent from a current rate of 30 per cent.
* Interchangeability of PAN and Aadhaar for ITR for thosewho don’t have PAN cards.
* Advises GST Council to reduce tax rate on EVs from 12 per cent to 5 per cent.
* Duty has been raised on: tiles, cashew kernels, vinyl flooring, auto parts, some synthetic rubber, digital and video recorder and CCTV camera.
Affordable housing:
* Rental laws to be reformed. Modern tenancy laws will be shared with states to promote house renting.
To promote digital payments:
* 2% TDS on withdrawals of Rs 1 crore in a year from your bank account for business payments.
* No charge on digital payments: MDR charges waived on cashless payment.
Ease of living:
* Aadhaar card for NRIs on arrival in India.
* Rs 3,000 pension per month for workers from the informal sector.
Transportation
* Inter-operable One Nation One transport card: ATM-like Transport card for universal travel on various modes of transport (metro, road, railways etc).
* Govt plans to create MRO (Manufacturing, Repair and Operate) industry.
* PPP to be used to unleash faster development and the delivery of passenger freight services.
* Comprehensive restructuring of National Highways Programme for creation of National Highways Grid.
* Government envisions using rivers for cargo transport to decongest roads and railways.
Economy:
* Fiscal deficit in FY 19 at 3.3% of the GDP.
* Govt will start raising part of borrowing in foreign currency.
* Govt external debt to GDP is among the lowest in the world.
Women empowerment:
* Nari tu Narayani: Women SHG Interest Subvention Programme to be expanded to all districts in India.
* Rs 1 lakh loan to be provided for SHG women members.
* Every verified woman SHG member having a Jan Dhan account can avail Rs 5,000 rupees overdraft facility.
Banking reform:
* On purchase of high-rate pooled assets of NBFC amounting of Rs 1 lakh core in this FY, govt will provide one-time 6 month credit guarantee.
* Propose to provide Rs 70,000 crore capital for PSU Banks.
* Regulation of HFCs (Housing Finance Cos) to move to RBI from National Housing Bank.
Divestment:
* Govt to modify present policy of retaining 51% stake in PSUs.
* Govt to continue with strategic divestment of select CPSEs.
* Divestment target of Rs 1.05 lakh crore for FY 20.
Railways:
* A new PPP model will usher in the a new dawn of Indian railways.
* Railways to be encouraged to invest more in suburban rail network via SPVs.
* Railway infrastructure will need an investment of Rs 50 lakh crore between 2018 and 2030.
MSME:
* Propose easing angel tax for startups.
* Angel tax: Wont require scrutiny from I-T department for startup.
* 2% interest subvention for GST-registered MSME on fresh or incremental loans.
* ‘Stand Up India’ Scheme to continue till 2025.
* New television channel for start-ups.
* Pension benefit extended to retail traders with annual turnover less than Rs 1.5 crore.
* New payment platform for MSMEs to be created.
Education:
* Govt to launch ‘Study in India’ programme to attract foreign students in higher education.
* Allocate Rs 400 crore for world-class higher education institutions in FY 20 .
* To unveil a new education policy.
* National research foundation to fund, coordinate and to promote research in the country.
* New Higher Education Commission with focus on higher autonomy.
* New national education policy to propose changes in school, higher education.
Tourism:
* 17 iconic world-class tourist sites to be developed.
* govt will launch an ATM-like One Nation One Card for pan-India travel
FDI:
* Local sourcing norms will be relaxed for the single-brand retail sector.
* Govt to open FDI in aviation, insurance, animation AVGC and media.
Investment:
* Existing KYC norms for FPIs to be rationalized and simplified to make it more investor-friendly.
* Long-term bonds for market.
* To allow FIIs & FPIs investment in debt securities issued by NBFCs.
* Credit Guarantee Enhancement Corporation to be set up long-term bonds with specific focus on infra sector
* Propose Social Stock Exchange under SEBI for listing social enterprises & voluntary organisations.
* To merge NRI portfolio route with FPI route.
* To hike statutory limit for foreign investment in some companies.
* To set up a credit guarantee enhancement corporation.
* Govt will take up measures to make RBI & SEBI depositories inter-operable.
* SEBI to mull increasing minimum public shareholding to 35% from 25%.
* User friendliness of trading platforms for corporate bonds will be reviewed, including issues arising out of capping of International Securities Identification Number.
* To deepen corporate tri-party repo market in corporate debt securities. Plan to enable stock exchanges to allow AA rated bonds as collateral.
* Annual Global Investors’ Meet for attracting global players to come and invest in India.
*To allow FPIs to subscribe to listed debt papers of REITs.
Auto sector:
* FAME II scheme aims to encourage faster adoption of electric vehicles through the right incentives and charging infrastructure.
For Rural India:
* Gaon, Garib and Kisan are the focus of our government.
* New Jal Shakti ministry will work with states to ensure Har Ghar Jal for all rural houses by 2024.
* Pradhan Mantri Gram Sadak Yojana phase 3 is envisaged to upgrade 1,25,000 km of road length over the next 5 years.
* Govt will set up 100 new clusters for 50,000 artisans in FY 20.
* To invest Rs 80,250 cr for upgradation of roads under PM Gram Sadak Yojana.
*Every single rural family, except those unwilling, to have electricity by 2022.
Agriculture:
* Govt to promote innovative zero Budget farming.
* 10,000 new farm produce organisations.
* 80 Livelihood business incubators and 20 technology business incubators to be set up in 2019-20 under ASPIRE to develop 75,000 skilled entrepreneurs in agro-rural industries.
Space:
* India has emerged as a major space power. It is time to harness our ability commercially.
* A public sector enterprise, New Space India Limited (NSIL) has been incorporated to tap benefits of ISRO.
Sports:
* To popularise sports at all levels, National Sports Education Board for development of sportspersons to be set up under ‘Khelo India.’
(With inputs from Economic Times)
