Union Budget 2020: Key Highlights
As the Finance Minister Nirmala Sitharaman presented her first Union Budget of the decade full of sops and tax breaks, with major focus on employment and youth-centred programs, here are the key takeaways from her Budget speech:
* The estimated nominal growth of GDP for the year 2020-21 has been set at 10 per cent. The level of expenditure has been kept at Rs 30.4 lakh crore.
* The date of housing loan sanction, for availing of the Rs 1.5 lakh additional deduction on interest paid, has been extended by one more year. Earlier, the deduction was allowed for home loans sanctioned before March 31, 2020.
* The FM has announced the extension of the tax holiday on the profits earned by the affordable housing project developers by one year, till March 31, 2021. This is expected to boost the supply of affordable houses in the country. The FM has allotted Rs 27,500 crore for the Pradhan Mantri Awas Yojana (PMAY) scheme, marginally more than the previous year.
* The FM has increased the limit from the existing 5 per cent to 10 per cent, as the difference acceptable between the consideration value and circle rate, beyond which the difference will be counted as income, both, in the hands of the purchaser as well as the seller.
* The Finance Minister has also announced a new tax structure which will be optional and applicable to only those who forgo certain deductions and exemptions. The new structure looks like this-
Taxable income slab | Existing rate | New rate |
Rs 0-2.5 lakh | Exempt | Exempt |
Rs 2.50-5 lakh | 5% | 5% |
Rs 5-7.5 lakh | 20% | 10% |
Rs 7.5-10 lakh | 20% | 15% |
Rs 10-12.5 lakh | 30% | 20% |
Rs 12.5-15 lakh | 30% | 25% |
Rs 15 lakh and above | 30% | 30% |
* The FM has also removed 70 out of 100 exemptions and deductions of different nature in the Income Tax Act. The remaining exemptions and deductions will be rationalised in the next few years, said Nirmala Sitharaman.
* Nirmala Sitharam has announced plans to accelerate the development of road connectivity, which includes the construction of 2500 kms of access-controlled highways, 9000 kms of economic corridors and 2000 kms of coastal and land port roads, along with 2000 kms of strategic highways.
* The FM laid emphasis on the development of Delhi Mumbai Expressway which will be completed by 2023 and the Chennai Bengaluru Expressway.
* The Bengaluru Suburban Transport Project will be actively pursued, for which the Centre will contribute 20 per cent of the project cost as equity and would facilitate external borrowing for the remaining part.
* More Tejas-type trains will be introduced which will connect iconic destinations. Moreover, private participation will be invited for operating train services and redevelopment of stations.
* For pushing air connectivity, the FM has announced development of 100 new airports in the country by 2024 to support the UDAN scheme. The air fleet is also expected to go up from 600 to 1,200, the FM said.
* The FM has allocated Rs 4,400 crore for encouraging states and Union Territories to formulate and implement plans for addressing air pollution in cities with a population of above one million.
* The FM has proposed an outlay of Rs 1.7 lakh crore for transport infrastructure, out of which Rs 17,482 crore has been allotted to metro projects for the next financial year.
* The FM has allocated Rs 12,300 crore for the Swachh Bharat Mission under which focus will be on liquid and greywater management, solid waste collection, source segregation and processing.
* Additional budget of Rs 3.6 lakh crore has been allocated for the Jal Jeevan Mission which aims to provide piped water supply to all households. Also, the government will propose comprehensive measures for 100 water-stressed districts.
* Urban local bodies across the country would provide internship opportunities to engineers for a period of up to one year.
* The government has proposed to develop five new smart cities which will be chosen on the basis of three parameters - upcoming economic corridors, revitalisation of manufacturing activities and demands of aspirational classes.
* The government will create warehousing, in line with Warehouse Development and Regulatory Authority (WDRA) norms and will provide Viability Gap Funding for setting up such efficient warehouses at the block level.
* In order to provide quality education to students of deprived section of the society, as well as those who do not have access to higher education, the government has proposed to start degree-level full-fledged online education program to be offered only by top rated institutions.