Tribune Web Desk
Chandigarh, February 1
Finance Minister Nirmala Sitharaman on Monday proposed more than doubling of healthcare spending while imposing a new agri cess on certain imported goods and raising customs duty on items ranging from cotton to electronics in a bid to pull the economy out of the trough.
In her Budget for the fiscal year beginning April 1, she restricted tax-free interest on retirement fund to Rs 2.5 lakh annually but gave tax exemption on Leave Travel Concession subject to incurring of specified expenditure.
A new Agriculture Infrastructure and Development Cess will be imposed from Tuesday on customs duty levied on bullion, alcoholic beverages, coal and agriculture products ranging from apple to lentil.
But to reduce the burden on consumer, customs or import duty on these items was cut.
A cess of Rs 2.5 per litre on petrol and Rs 4 per litre on diesel was also slapped but this was offset by a reduction of an equivalent amount in the excise duty – making it price neutral for consumers.
Also, a tax deducted at source (TDS) of 0.1 per cent will be levied on the purchase of goods exceeding Rs 50 lakh in a year. The responsibility of deduction shall lie only on the persons whose turnover exceeds Rs 10 crore.
In a relief to senior citizens, those above 75 years of age with only pension and interest income would no longer have to file income tax returns.
In order to incentivise the purchase of an affordable house, the finance minister proposed to extend the period for claiming an additional deduction for the interest of Rs 1.5 lakh paid for home loans by one year to March 31, 2022.
To remove hardship faced by NRIs in respect of their income accrued on foreign retirement benefits account due to mismatch in taxation, new rules for alignment will be notified.
Foreign direct investment (FDI) limit in insurance was proposed to be raised to 74 per cent from the current 49 per cent.
In order to provide relief to taxpayers, advance-tax liability on dividend income shall arise only after the declaration/payment of dividend.
The dividend paid to Real Estate Infrastructure Trusts or Infrastructure Investment Trusts (REIT/InvIT) shall be exempt from TDS.
Tax holiday for start-ups has also been extended by one year to March 31, 2022.
The time-limit for re-opening of income tax assessment has been reduced to 3 years from the current 6 years. Re-opening up to 10 years is proposed to be allowed only if there is evidence of undisclosed income of Rs 50 lakh or more for a year.
In her budget speech in the Lok Sabha, Sitharaman projected a fiscal deficit of 6.8 per cent of gross domestic product for the next 2021-22 fiscal. The current year was expected to end with a deficit of 9.5 per cent as against a target of 3.5 per cent.
With about 1 per cent spending of GDP on health, she proposed raising of the spending to Rs 2.2 lakh crore to help improve health systems as well as fund vaccination drive against coronavirus.
By the end of the current fiscal on March 31, the government would spend Rs 94,452 crore.
“The investment on health infrastructure in this budget has increased substantially,” she said.
Customs duty on cotton, silk, maize bran, certain gems and jewellery, specified auto parts, screws and nuts was hiked.
To promote value addition in the electronics sector, the same for printed circuit board assembly, wires and cables, solar inverters and solar lamps were also raised.
The import duty on naphtha, iron and steel melting scrap, aircraft components, gold and silver was reduced.
She also allocated Rs 20,000 crore to recapitalise state-run banks that are saddled with bad loans and have been a drag on growth.
The revenue target from the privatisation of PSUs was put at Rs 1.75 lakh crore with a planned initial public offering (IPO) of Life Insurance Corporation (LIC) among the state-run companies that will be sold in the next fiscal.—with PTI
Also read: Budget 2021-22: Key numbers to be watched
Budget 2021: Here are the major proposals across key sectors
New Agri Infra Development Cess to be applicable from February 2, 2021.
Agri infra cess of 17.5% on crude palm oil, 20% on crude soyabean, sunflower oil imposed.
Agri infra cess of 100 pc imposed on alcoholic beverages. PTI
Agri infra cess of 30% on kabuli chana, 10% on peas, 50% on bengal gram/chick peas, 20% on lentil (mosur); 5% on cotton imposed in Budget.
Budget for 2021-22 imposed a Rs 2.5 per litre agri infra cess on petrol, Rs 4 on diesel.
Govt proposes to relax norms to attract more foreign investment in infrastructure sector: FM.
FM proposes tax exemption for aircraft leasing cos; tax exemption for notified affordable housing for migrant workers.
Govt proposes to review over 400 old exemptions in indirect taxes; to begin extensive consultation from October 2021: FM.
Customs duty on iron and steel to be unified at 7.5 percent
- Duty exempted on steel scrap
- Copper scrap duty down from 5 % to 2.5 %: FM
- Rationalising customs duties on gold and silver, says FM in Budget for 2021-22.
- Customs duty on certain auto parts, solar equipment raised: FM.
- Customs duty on cotton, raw silk raised: FM.
Govt proposes to relax norms to attract more foreign investment in infrastructure sector: FM
NRI who return to India face difficulty. I propose to amend rules to remove double taxation: FM
Union Budget Housing Loan legibility extended till March 2022. It means additional deduction of 1.5 lakh on payment of interest will be provided to individual taking loan till March 31, 2022: FM
We have made record collections of GST in the last few months: FM
Tax holiday for start-ups extended for one year
- Govt cuts timeline for reopening of tax cases to 3 yrs from 6 yrs: FM.
- Income tax return filers increased to 6.48 cr in 2020 from 3.31 cr in 2014.
- Govt proposes setting up of conciliatory mechanism for quick resolution of contractual disputes.
Relief for senior tax payers
- Senior citizens above the age of 75, who have only pension and interest from FDR, will not need to file returns.
- The bank will deduct the tax: FM
FM allocates Rs 3,726 cr for forthcoming Census which will be the first digital census. PTI
Govt proposes national language translation initiative.
FM says modalities worked out for national research foundation; earmarks Rs 50,000 cr over five years.
Rs 1,500 cr earmarked for scheme to incentivise digital payments: FM
Covid led to weak revenue inflow but a high outflow to manage the pandemic: FM
- Budget 2021-2022 is Rs 34.83 lakh crore
- The fiscal deficit is 9.5 per cent of the GDP
- We will reach the ideal 4.5 fiscal deficit by 2025-26: FM
- 17 states to get revenue deficit grant
100 new Sainik Schools to be set up in partnership with NGOs; 15,000 schools to be strengthened as per National Education Policy: FM.
Govt proposes to amend apprenticeship law to enhance opportunities for youth: FM
One nation, one ration card plan under implementation in 32 states, 1 UT : FM.
Central University in Leh to be set up
Women allowed to work in night shift in all sectors with adequate safeguards
Govt committed to welfare of farmers, says FM
- Wheat amount paid to farmers in 2013-14 was Rs 33,874 crore, it was Rs 62,802 crore in 2019-20: FM
- 43.36 lakh wheat growing farmers benefited from govt procurement under MSP as against 35.57 lakh previously: FM.
- Agri procurement has increased steadily, benefiting farmers, says FM amid opposition slogan shouting against three farm laws.
- Farmers paid Rs 75,100 cr on wheat MSP in FY21: FM.
- FY22 Agriculture credit target at Rs 16.5 lakh crore: FM
- APMC will be given funds to augment their infrastructure
LIC to go for IPO: FM
Disinvestment of two public sector banks and one general insurance company: FM
All public sector companies, other than those in the strategic sector, will be privatized. A special purpose vehicle will be formed for using surplus land.
Working towards strategic disinvestment: FM
FDI limit in insurance to be upped from 49 per cent to 74 per cent with safeguards on foreign investments
Deposit insurance is of Rs 5 lakh. We will streamline provisions that depositors can get easy and time-bound access to their kitty in stressed banks
Framework will be put in place to allow electricity consumers to choose from more than one distribution company: FM.
City gas distribution network of providing CNG to automobiles and piped cooking gas to households in 100 more districts
Fuel supplies were kept running without interruption during Covid-19 lockdown: FM
Highway boost in poll-bound states
8,500 kms of road, highway projects to be awarded by March 2022 to further augment road infrastructure: FM
Two new technologies in Metro railways
New technologies called ‘light metro’ and ‘metro neo’ which are less costlier will be used for tier 2 cities and peripheral areas of tier 1 cities.
FM announces Rs 18,000 cr scheme to augment public transport in urban areas.
FM says national monetisation pipeline for potential brownfield infrastructure assets will be launched.
FM announces voluntary vehicle scrapping policy to phase out old vehicles; fitness tests after 20 yrs for personal vehicles.
Railway to monetise dedicated freight corridors, says FM Sitharaman in her Budget speech on monetisation of assets.
Pipelines of GAIL (India) Ltd, Indian Oil Corp (IOC) and HPCL will be monetised, says FM in Budget for 2021-22.
Capital expenditure budget to increase to Rs 5.54 lakh cr in FY’22 from Rs 4.39 lakh cr in RE for FY’21.
100 per cent broad gauge electrification to be completed by 2023.
High-density routes will provide the anti-collision system. 1.55 lakh crore for railways
Govt to provide Rs 35,000 cr for Covid-19 vaccination in 2021-22; committed to providing more funds, says FM
Swachh Bharat 2.0 will be implemented with outlay of Rs 1,41,678 cr over 5 years: FM
Govt to introduce bill to set up development financial institution with an outlay of Rs 20,000 cr: FM
Our manufacturing companies have to become part of global supply chains: FM
We have committed 1.79 lakh crores over five years.
Seven textile parks to be established over three years: FM
Scheme of mega investment textiles park in addition to PLI scheme will be launched: FM
We have an ambition to lend 5 lakh crore within three years for new projects: FM
Govt fully prepared to support economy for sustainable growth: FM.
4 new national institutes of virology to be set up
New Scheme for drinking water and sanitation
4,378 urban local bodies will see a massive investment of Rs 2,87,000 crore over five years. 2.68 crore households will benefit from the scheme.
42 urban centres, with a million or more population, will get money to take measures to curb pollution.
Aatmanirbhar packages after Covid-19 cost Rs 27.1 lakh crore. It is 13 per cent of our GDP. The packages were like 5 mini budgets: FM
Aatmanirbhar package accelerated pace of structural reforms.
Atmanirbhar Health Yojana with outlay of 64,180 Crore
We have two Covid-19 vaccines, and two or more vaccines are expected soon.
Only 3 times Budget followed contraction in economy: FM
Unprecedented contraction in the global economy as well, says FM
FM Sitharaman begins budget speech amid slogans from opposition parties
Union Cabinet approves Budget 2021-2022
-Support MSMEs, farmers and workers to generate employment.
-Increase Healthcare expenditure to save lives.
-Increase Defence expenditure to safeguard borders.
— Rahul Gandhi (@RahulGandhi) February 1, 2021
Sensex surges 400 points
Sensex surges 443 pts to 46,728.83 in opening trade ahead of Budget presentation; Nifty up 114.85 pts at 13,749.45.
Union Cabinet meet at 10.15 am to clear the Budget.
Also before the actual presentation, the Cabinet headed by Prime Minister Narendra Modi approved the Budget for the fiscal year 2021-22.–PTI
Finance Minister Nirmala Sitharaman has now arrived at Parliament.
Sitharaman meets President Ram Nath Kovind before presenting the budget
Finance Minister Nirmala Sitharaman on Monday called on President Ram Nath Kovind before presenting the Union Budget 2021-22.
As per established tradition, the Finance Minister met the President at the Rashtrapati Bhawan before heading to Parliament.–PTI
Finance Minister @nsitharaman, MoS Finance & Corporate Affairs @ianuragthakur, and senior officials of the Ministry of Finance, called on President Kovind at Rashtrapati Bhavan before presenting the Union Budget 2021-22. pic.twitter.com/FUNptDXnHB
— President of India (@rashtrapatibhvn) February 1, 2021
With the Union Budget 2021 set to be delivered in paperless form for the first time as Finance Minister Nirmala Sitharaman switched to a tablet.
The Finance Minister was seen carrying a tablet kept inside a red coloured cover with a golden coloured national emblem embossed on it.–ANI
Finance Minister Nirmala Sitharaman left the Finance Ministry for Parliament to announce the 2021-22 Union Budget.