Union Budget 2019
Budget Highlights: What is changing for FY 19-20?
On 5th July 2019 for the first time in India, a woman Finance Minister Ms. Nirmala Sitharaman presented the Budget. This budget will be implemented for the Financial Year 2019-20 and Assessment Year 2020-21.
Vision – India to become $5trillion economy in next 5 years. Already at almost $ 3 trillion by end of this year. Of these almost $1 trillion added in last 5 years.
FM puts thrust on Infrastructure – Need to invest heavily in Infra.
Rental Laws: Modern Tenancy Law will be finalized.
Loans up to Rs 1 cr to MSME will be sanctioned under 1 hr. With interest subvention to GST registered and other MSME.
Pension benefit extended to retail traders and shopkeepers with a turnover of less than Rs1.5cr under Pradhan Mantri Karma yogi Yojana. The only requirement will be Aadhar and Bank account.
The government will allow FPI in Debt securities.
Opening of FDI inflows will be further examined in Aviation and Media sector.
India has emerged a Space Power and will garner this commercially by marketing / selling the launching pads etc and other types of equipment/ research & development carried out by ISRO.
Public holding in listed firms will increase to 35% from 25%.
Rural India –
Electricity will be provided in all houses except those who are unwilling by 2022, Clean cooking facility will be provided and housing will be provided under PM Aavas Yojana.
Roads will be upgraded under PM gram sadak Yojana – Phase 3.
New Mantralay -Jan shakti Mantralaya will be formed for hygienic drinking water and sanitation and will look after water supply across cities. FM announced “Har ghar Jal” by 2024.
Swatcha Bharat Vision to undertake Solid Waste Management in every village.
Internet service sin every Panchayat.
1.95 cr houses will be constructed by 2022.
National Research Foundation to be formed for strengthening Research and making Indian education as best in class across globe.
Study In India – to bring in foreign students to India for studies.
Khelo India Scheme – to promote sports
New Age skills will be promoted like AI, Virtual Reality, Big Data etc.
Streamlining of Labour laws, filing returns etc.
Promote the use of Solar power etc.
Railway station modernisation will be launched.
FM announced Gandhipedia – to spread teachings of Gandhi.
Women Power – Nari to Narayan. Role of women is important in rural economy. A committee formed to suggest further information. Interest subvention scheme for women and funding including overdraft.
Aadhar cards will be issued to NRIs with Indian passports if they return without waiting for 180 days.
Banking and Financial sectors:
NPAs down by Rs 1 lakh crore over last 1 year and Rs 70,000 cr allocated for PSU bank capitalisations.
Better Reforms are promised.
NBFCs 1 time 6 mth partial guarantee will be provided to buy pooled assets of financially sound NBFCs by public sector banks.
Regulation of HFCs will be moved to RBI. This is especially in view of NBFC scare.
Divestment – Rs 1.05 lakh divestment target for FY 20.
Direct Tax revenue significantly increased by 78% to 11.37lakh crores from Rs 6.8 lakh crores in 2014.
Corporate Tax rate of 25% applicable to all companies with turnover upto Rs 400 crores.
Additional IT deduction of RS 1.5lacs for the interest paid on loans for taking Electric vehicals.
Additional IT deduction of RS 1.5lacs for the interest paid on affordable housing loan taken upto 31 March 2020..
STT simplified by levy only on the difference between the strike price and settlement in case of options.
Series of measures announced regarding Tax department / filings and Assessments:
Interchangeability of PAN and Aadhar announced for Ease. So an individual who doesn’t have PAN can use Aadhar to file return etc
Pre-filled tax returns will be available.
E-assessment – No harassment for assessees and no human interface for verifications etc. Scrutiny notices will be allocated randomly.
To discourage cash transactions TDS of 2% levied on cash withdrawals from a bank account more than Rs 1 cr in a year.
Enhance in surcharge for assessees with income Rs 2 cr to Rs 5 cr and more than Rs 5 cr.
GST returns to be filed only quarterly by assessees with turnover less than Rs. 5 cr.
Buyback tax of 20% extended to listed companies. This will remove the arbitrage between Dividend and buyback.