The Union Budget for 2020-21, to boost income and enhance their purchasing power.
Indian Budget Highlights
- FY20 fiscal deficit revised to 3.8% from 3.3% in the current fiscal. For FY21, fiscal target seen at 3.5%..
- Net market borrowing for FY20 at Rs 4.99 lakh crore; For FY21 it’s pegged at Rs 5.36 lakh crore.
- Nominal GDP growth for 2020-21 estimated at 10%.
- Receipts for 2020-21 estimated at Rs 22.46 lakh crore. Expenditure at Rs 30.42 lakh crore.
A new tax regime has been announced. Those who want to be in the old regime with exemptions can continue to pay at the old rates.
|Between Rs.5 Lakh and Rs.7.5 Lakh||Reduced to 10% from the current 20%|
|Between Rs.7.5 Lakh and Rs.10 Lakh||Reduced to 15% from the current 20%|
|Between Rs.10 Lakh and Rs.12.5 Lakh||Reduced to 20% from the current 30%|
|Between Rs.12.5 Lakh and Rs.15 Lakh||Reduced to 25% from the current 30%|
|Above Rs.15 Lakh||Continue at 30%, but without exemptions|
- Over 70 deductions have been removed
- Companies will no longer be required to pay Dividend Distribution Tax (DDT).
- Concessional corporate tax rate of 15 per cent to new domestic companies in manufacturing and power sector.
Economy and Finance:
- Bank deposit insurance coverhad been increased from ₹1 lakh to ₹5 lakh per depositor.
- Government to sell part of its stake in LIC via public offering.
- Proposal to sell balance holding of government in IDBI Bank.
- Few PSBs to be encouraged to approach the capital market to raise additional capital.
- Tax on cooperative societies reduced to 22% without exemptions.
- FPI limit in corporate bonds raised to 15% from 9%.
Agriculture, Irrigation and Rural Development:
- Rs 2.83 lakh crore to be allocated for the 16 Action Points; Rs 1.6 lakh crore allocated to agriculture and irrigation; Rs 1.23 lakh crore for Rural development and Panchayti Raj.
- Milk Production Capacity to be expanded 108T from 53.5T.
- Fish production capacity to increase to 200 Lakh Tonnes by 2022-2023
- Doubling farmers’ incomes by 2020
- Agri-credit availability set at ₹15 lakh crore for 2020-21.
- Comprehensive measures for 100 water stressed districts.
- Provide 20 lakh farmers to set up standalone solar pumps. Help another 15 lakh farmers to solarise their power grid.
- Village storage scheme proposed to be run by women SHGs.
- Indian Railways to have refrigerated coaches capability in ‘kissan trains’ to carry perishables and milk.
- Krishi UDAN on international and national routes.
Health and Sanitation:
- An allocation of ₹69,000 crore for the health sector.
- ₹12,300 crore for Swachh Bharat this year.
- Proposal to set up hospitals in Tier-II and Tier-III cities with the private sector using PPP.
- Expand Jan Aushadhi scheme to provide for all hospitals under Ayushmann Bharat by 2025.
- Budget proposes to provide ₹1.7 lakh crore for transport infrastructure in 2021.
- National Logistics Policy to be released soon.
- Chennai-Bengaluru Expressway to be started.
- Aim to achieve electrification of 27000 km of lines.
- Plan to have a large solar power capacity for Indian Railways.
- The government also proposes a Bengaluru suburban rail project at a cost of ₹18,600 crore.
- Govt to monetise 12 lots of national highways by 2024.
- 100 more airports will be developed by 2024 to support UDAN.
- Allocation₹99,300 crore for education sector in 2021 and about ₹3,000 crore for skill development.
- Urban local bodies to provide internship to young engineers for a year.
- Degree-level full-fledged online education programmes by institutions ranked in top 100 in NIRF rankings, especially to benefit underprivileged students.
- A national police university and a national forensic science university is proposed to be setup.
- IND SAT exam for students of Asia and Africa to promote “study in India” programme.
Power and Energy:
- 22, 000 crore proposed for power and renewable energy sector in 2020-21.
- Expansion of national gas grid from the present 16200 km to 27000 km proposed.
- Further reforms to facilitate transparent price discovery and ease of transactions.
- Expansion of National Gas Grid from 16,200 km to 27,000 km along with reforms to deepen gas markets, enable ease of transactions and transparent price discovery.
- Tax holiday for affordable housing extended by 1 year. Additional deduction up to Rs. 1.5 lakhs for interest paid on loans taken for an affordable house extended till 31st March, 2021.
- Rs 6,000 crore for BharatNet programme; Fibre to Home connections under BharatNet will be provided to 1 lakh gram panchayats this year itself.
- New policy for private sector to build Data Centre Parks.
- Customs duty raised on footwear to 35% from 25% and on furniture goods to 25% from 20%.
- Excise duty proposed to be raised on Cigarettes and other tobacco products.
- Basic customs duty on imports of news print and light-weight coated paper reduced from 10% to 5%.
- Customs duty rates revised on electric vehicles and parts of mobiles.
- 5% health cess to be imposed on the imports of medical devices, except those exempt from BCD.
- Lower customs duty on certain inputs and raw materials like fuse, chemicals, and plastics.
- Higher customs duty on certain goods like auto-parts, chemicals, etc. which are also being made domestically.
Tax concession for foreign investments:
- 100% tax exemption to the interest, dividend and capital gains income on investment made in infrastructure and priority sectors before 31st March, 2024 with a minimum lock-in period of 3 years by the Sovereign Wealth Fund of foreign governments.
DISCLOSURE IN PURSUANCE OF SECTION 19 OF SEBI (RA) REGULATION 2014
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