Introduction
Finance Minister Piyush Goyal presented the interim Budget on Friday, 1 February, 2019. This interim Budget is the sixth and final budget presented by the Narendra Modi-led government. The announcements in the budget ranged from full tax rebate to individual taxpayers earning annual income up to Rs. 5 lakh, and direct income support to vulnerable farmers.
Highlights
Union Budget 2019 - Top Highlights:
- Individual taxpayers having annual income up to Rs 5 Lakh will get full tax rebate.
- Gratuity payment limit has been increased from Rs 10 lakh to Rs 20 lakh.
- Defence budget has been enhanced beyond Rs 3 lakh crore.
- Direct income of Rs 6, 000/year will be provided to farmers with up to two hectares of land.
- Assured monthly pension of Rs 3000/month for workers in unorganized sector after 60 years of age.
- Farmers severely affected by natural calamities will get 2% interest subvention and additional 3% subvention upon timely repayment.
- TDS limit raised from 10. 000 to 40, 000 on bank savings and post office savings in budget 2019.
- Budget allocation to North East region increased by 21 percent to Rs 58, 166 crore for 2019-20.
- All income tax returns and refunds to be completed within 24 hours.
- Single window clearance for filmmaking will be made available to filmmakers.
Income Tax
Income Tax Exemptions:
- In a move aimed at the middle class, Finance Minister Piyush Goyal announced a full tax rebate for individual taxpayers earning an annual income of Rs. 5 lakh.
- Individuals with a gross income up to six-and-a-half lakhs with specified investments and savings will also be exempt from paying tax.
- Piyush Goyal also announced that income tax returns will be processed within 24 hours and returns will be paid immediately. Also, all assessment and verification of IT returns will be done electronically, without any intervention by officials.
Farmers
Direct Income Support for Farmers:
- The Pradhan Mantri Kisan Yojana was also announced in the Budget. The scheme will help vulnerable farmers get direct income support of Rs 6,000 per year. The scheme is for farmers with less than two hectares of landholding.
- Rs 6,000 per year will be given in three instalments and will be transferred directly to the farmers' bank accounts.
- The initiative will benefit 12 crore small and marginal farmers, at an estimated cost of Rs 75,000 crore, said Goyal. He also announced that farmers severely affected by natural calamities will get 2 percent interest subvention and additional 3 percent interest subvention upon timely repayment.
Defence
Defence Budget Increased Above Rs 3 Lakh Crore:
- The defence Budget has also been enhanced beyond Rs 3 lakh crore.
- Piyush Goyal (Finance Minister) also said that 'One Rank One Pension', which was pending for the last 40 years, has been implemented by the Modi government and that Rs 35,000 crore have been disbursed for the soldiers under the scheme.
Railways
Railway’s FY 19 Vs FY 20:
- Railway’s operating ratio seen 96.2% in FY 19 Vs 95% FY 20.
- Railway’s capex for FY20 set at record Rs 1.6 lakh crore.
- Today there is not a single unmanned railway crossing on the broad gauge in India.
Pensions
Pension for the Unorganised Sector:
- The Pradhan Mantri Shram Yogi Maan Dhan Yojana was announced with unorganised sector workers getting Rs 3,000 pension monthly after the age of 60.
- The gratuity payment limit has been increased from Rs 10 lakh to Rs 20 lakh.
GST
A Possible Reduction in GST for House Buyers:
- GST collections has crossed Rs. 1 lakh crore in January 2019.
- Finance Minister Piyush Goyal also said that the group of ministers (GoM) should suggest ways to reduce GST for house buyers.
- Direct tax collections increased from Rs 6.38 lakh crore in 2013-14 to almost Rs 12 lakh crore; The tax base is up from Rs 3.79 crore to 6.85 crore.
- Indian Customs to fully digitized exim transactions and leveraging RFID for logistic. Govt abolishes duties on 36 capital goods.
- Businesses with less than Rs 5 crore annual turnover, comprising over 90% of GST payers, will be allowed to return quarterly returns.
- GST has been continuously reduced, resulting in relief of 80, 000 crore rupees to consumers; most items of daily use for poor and middle class are now in the 0% - 5% tax bracket.
- Finance Minister Piyush Goyal announced that GST-registered MSME units to get 2 percent interest subvention on loan of 1 crore.
Schemes
Social schemes:
- For the welfare of farmers and for doubling their income, historic decision was taken to increase MSP by 1.5 times the production cost for all 22 crops.
- Committee under NITI Aayog to be set up to for denotifed nomadic & semi nomadic communities.
- Govt to build 1 lakh digital villages.
- A single window clearance for filmmakers to be made available ro filmmakers, anticamcording provision to also to be introduced to Cinematography Act to fight piracy.
- To ensure cleaner fuel and health assurance, we embarked upon Pradhan Mantri Ujjwala Yojana, a programme to give 8 crore free LPG connections to rural households, 6 crore connections have been given already.
Economy
State of Economy:
- India is poised to become a $5 trillion economy in next 5 years, $10-trillion economy in the next eight years.
- Fiscal deficit seen at 3.4 percent in FY 19 and Current account deficit at 2.5% of the GDP.
- Black money: Committed to eliminating the scourge of black money; anti-black money measures taken have brought an undisclosed income of about 1.30 lakh crore rupees to the fore; 3.38 lakh shell companies were deregistered.
- Indian GDP: Growth in the last 5 years has been higher than that by any other govt. Spent Rs. 2.6 lakh crore in recap of PSU Banks.
- Domestic air traffic was doubled in the last 5 years.
- Loans worth Rs. 7.23 lakh crore have been given under Mudra Yojana.
- Monthly mobile data consumtion has increased 50x in last 5 years; cost of data & voice calls in India is possible the lowest in the world.
- Lower costs of Stents & Knee implants have benefitted people. Government has announced 14 new AIIMS since 2014.
- Ayushman Bharat the world's largest healthcare programme was launched to provide medial care to almost 50 crore people, resulting in 3, 000 crore savings by poor families.
- Piyush Goyal said that everybody will get electricity connection in the near future. Government have provided 143 crore electricity bulb to the poor.
- Over 90 percent of the country has been covered under sanitation coverage. More than 5.45 lakh villages have been declared Open Defecation Free.
- The Budget 2019 states there will be no TDS on house rent up to Rs 2.4 lakh per year and no TDS on bank, post office interest up to Rs 40,000, up from Rs 10,000.
- The Finance Minister announced that the standard deduction was raised from Rs 40,000 per year to Rs 50,000 per year.
- Piyush Goyal said that direct tax collections have been increased from Rs 6.38 lakh crore in 2013-14 to almost Rs 12 lakh crore. The tax base is up from Rs 3.79 crore to 6.85 crore, he added.