Finance minister Nirmala Sitharaman presented her fifth and the last full year Budget of the Modi 2.0 Government on February 1, 2023. She has termed the Union Budget 2023 as the first Budget of ‘Amrit Kaal’ and said that Indian economy is on the right track, and heading towards a bright future
Income tax rebate limit increased from Rs 5 lakh to Rs 7 lakh
Finance Minister Nirmala Sitharaman said the income tax rebate has been extended on income up to Rs 7 lakh, under the new income tax regime.
“Introduced in 2020, the new personal income tax regime with 6 income slabs, starting from Rs 2.5 Lakhs. I propose changing the tax structure in this regime by reducing the number of slabs to 5 and increasing the tax exemption limit to Rs 3 Lakhs,” she said.
She also proposed to make tax slabs more flexible under the new tax regime. “The new tax rates are 0 to Rs 3 lakhs – nil, Rs 3 to 6 lakhs – 5%, Rs 6 to 9 Lakhs – 10%, Rs 9 to 12 Lakhs – 15%, Rs 12 to 15 Lakhs – 20% and above 15 Lakhs – 30%, ” said Finance Minister Nirmala Sitharaman.
Boost to agriculture
The finance minister Nirmala Sithraman hasmade several announcements to boost the agricultural sector, including affordable solutions for challenges faced by farmers. She announced an agriculture accelerator fund to transform the agricultural sector.
The agricultural credit target will be increased to Rs 20 lakh crore, with focus on animal husbandry, dairy and fisheries. “We will launch a new sub-scheme with targeted investment of Rs 6,000 crore to aid activities of fishermen, fish vendors and MSMSEs,” said Finance Minister Nirmala Sitharaman.
Railway outlay at Rs 2.40 lakh crore; highest ever
The finance minister announced that the total outlay for the Indian Railway budget will be Rs 2.40 lakh crore, nine times more than the total outlay in 2013-14.
Health, Education and Skilling
Finance Minister Nirmala Sithraman said that 157 new nursing colleges will be established in co-location with the existing 157 medical colleges established since 2014. ICMR labs will be made for research by public and private medical college faculty and private sector R&D teams, to encourage collaborative research and innovation. She also announced a new programme to promote research and innovation in pharmaceuticals.
A National Digital Library for children and adolescents will be set up to facilitate the availability of quality books across geographies, languages, genres and levels and device-agnostic accessibility, said the Finance Minister.
Outlay for PM Awas Yojana increased
The outlay for the PM Awas Yojana, an initiative by the Modi Government in which affordable housing will be provided for the urban poor, is being enhanced by 66 per cent to over Rs 79,000 crore.
Big boost to capital investment
Investment and job creation continues to be the government’s top priority, as outlined by the finance minister in her budget speech. During her budget speech, Nirmala Sitharaman said that capital investment outlay is being increased by 33 per cent to Rs 10 lakh crore, which would be 3.3 per cent of GDP.
She also announced that the provision for 50-year interest-free loans to state governments has been extended by another year. This will be done to spur investment in infrastructure and to incentivise them for complimentary policy actions, with enhanced outlay of Rs. 1.3 lakh crore.
PAN Card to be Single Common Identifier
For business establishments required to have a Permanent Account Number, the PAN will be used as a common identifier for all Digital Systems of specified government agencies, said the finance minister.
Fiscal Deficit Target for Fiscal Year-24
The fiscal deficit target for FY24 has been reduced to 5.9 per cent of the GDP, compared to 6.4 per cent for FY23. The finance minister said, “I reiterate my intention to bring the fiscal deficit below 4.5 per cent of GDP by 2025-26.”
PM Vishwa Karma Kaushal Samman
A package of assistance for traditional artisans and craftspeople — has been conceptualized that will enable them to improve quality, scale and reach of their products, integrating with MSME value chain. Scheme includes financial support, upskilling, digital payments and social security.
Custom duty on cigarettes increased
Nirmala Sithraman said that a number of basic customs duty rates on goods other than textiles and agriculture should be reduced from 21 per cent to 13 per cent. As a result, there will be minor changes in the basic customs duties, cesses and surcharges on some items including toys, bicycles and automobiles. The customs duty on cigarettes has gone up once again.
“I propose to provide relief on Customs Duty on import of certain parts & inputs like camera lens & continue the concessional duty on lithium-ion cells for batteries for another year,” she said.
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