Finance Minister Nirmala Sitharaman presented the budget for the financial year 2021-22 on Monday, February 1. In the budget, the government's focus was on boosting the economy through health, infrastructure and banking reforms.
The Finance Minister has taken the initiative to give relief to the industry by not imposing any new tax. The government has announced to increase government spending regardless of fiscal deficit. Moreover, Sitharaman enumerated the names of six pillars in the budget -- Health and Welfare, Physical and Financial Capital, Infrastructure, Inclusive Growth for Aspiring India, Communicating Innovation in Human Capital, R&D and Minimum Government and Maximum Governance.
However, no significant relief has been announced to the income taxpayers in the budget. There is no change in the income tax slab. Meanwhile, senior citizens who are more than 75 years old and have income from pension and deposits, then announced an exemption from their income tax returns.
The Finance Minister has projected the fiscal deficit to be 6.8 per cent of GDP in FY 2022, which may be 9.5 per cent in 2021.
Key points to be remembered in Budget 2021-22:
- The cess on import of 'gold and silver' will be 2.5 per cent, alcoholic beverages (100 per cent), crude palm oil (17.5 per cent), apples (35 per cent), 'coal, lignite and peat' (1.5 per cent), fertilizers, including urea (5 per cent), and cotton (5 per cent). Moreover, 30 per cent on Kabuli gram, 10 per cent on peas, 50 per cent on Bengal gram, 20 per cent on lentils.
As per the Budget documents, AIDC of INR 2.5 per litre has been imposed on petrol and INR 4 per litre on diesel.
- 1 The deadline for reopening of income tax cases was reduced to three years. It is 10 years in serious fraud cases.
- The number of people filing tax returns increased to INR 6.48 crores in 2020 from INR 3.31 crores in 2014.
- The tax department will notify the rules to remove the problems caused by double taxation to overseas Indians (NRIs).
- Tax holiday for start-ups, capital gains tax exemption extended for one year.
- Tax exemption for notified cheap houses for aircraft leasing companies, migrant labourers.
- Rebate of 1.5 lakh rupees on interest payment for an affordable house for one year.
- For companies doing most of their work digitally, the tax audit exemption limit was doubled to INR 10 crores.
- The proposal to review the old 400 exemptions in customs, from October 2021, will be considered intensively.
- Customs were increased on some parts of vehicles, solar cars.
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