Stating that India has enjoyed the best phase of macroeconomic stability and has been recognized as a bright spot in last 5 years, Union Minister Piyush Goyal presented the Interim Budget 2019, which is the last Budget of the NDA government led by Prime Minister Narendra Modi before the Lok Sabha elections due by May. The Minister assured that “We are poised to become a 5 trillion dollar economy in the next 5 years and we aspire to become a 10 trillion dollar economy in the next 8 years.”
Here are the key highlights for the Budget 2019-
Income and Taxation
Citing an 80% growth in tax base and tax collection increasing to Rs 12 lakh crore this year, the Union Minister promised IT refunds and returns in 24 hours. He added that within nearly two years, almost all assessment and verification of IT returns will be done electronically by an anonymized tax system without any intervention by officials. However, no change in income tax rates was announced. But in order to reduce the tax burden on taxpayers, the government announced that individual taxpayers with taxable annual income up to Rs 5 lakh will get a full tax rebate.
Moreover, all interest income above Rs 40,000 from bank deposits will now get taxed and not Rs 10,000. The FM also raised standard deduction raised from Rs 40,000 to Rs 50,000. Further, no tax on notional rent on the second self-occupied house and no TDS on house rent up to Rs 2.4 lakh. The benefit of rollover on capital gains upto Rs. 2 Cr will be increased to investment on two residential houses. This benefit can be availed only once in a lifetime.
Also, the gratuity limit has also been increased from 10 lakh to 30 lakh rupees.
Reiterating the commitment to double farmers’ income by 2022, the government announced the PM Kissan Samman Nidhi Yojana for small and marginal farmers. Farmers having up to 2 hectares of lands will get Rs 6,000 per year, in three installments, to be transferred directly to farmers' bank accounts. The first installment of Rs 2,000 will be given to farmers soon. This farmer package will cost the government Rs 75,000 Cr and is expected to benefit 12 Cr farmers.
The government also announced a mega pension scheme for the unorganized sector. The scheme will be called PM Shramyogi Maan Dhan Yojana. The pension plan is worth Rs 500 Cr and is for those earning below Rs. 15,000. Beneficiaries will get an assured monthly pension of Rs 3,000 after retirement. Workers will contribute Rs 100 per month on joining. This scheme is expected to benefit 10 Cr workers.
Meanwhile, the ESI cover limit has been increased to Rs. 21,000. The minimum pension was also increased to Rs. 1000.
The government announced that businesses with less than Rs. 5 Cr annual turnover, comprising over 90% of GST payers, will be allowed to return quarterly returns. The government also proposed 2% interest subvention on loan of 1 crore for GST registered MSME units. However, no changes were announced in the corporate tax.
The FM reiterated that it is confident of reaching Rs 80,000 Cr divestment target.
Stepping up the pedal on digitization, the government announced a plan to set up one lakh digital villages in the next five years.
The Railways gets Rs. 64580 crore in this Budget. The operating ratio is expected to be 98 percent.
The government will start a national programme on Artificial Intelligence to harness the benefit from new age technologies in identified areas. A national programme on artificial intelligence has been envisaged by the government, which will be catalysed by the establishment of the National Centre of AI as a hub along with centres of excellence. Nine priority areas have been identified for the same. The Union Minister added that a national AI portal will be developed soon.
Through the budget the government is laying out a long term vision for the next 10 years to make India a $10 trillion economy and enhance ease of living including the development of roads, railways, seaports, health, among other things, on the outset, the Budget 2019 is an election budget aimed at boosting consumption. Will it garner results, needs to be seen.
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