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The budget 2023 is more of a continuation of the previous two years budgets. This year it focused on opportunities for citizens especially the youth, job creation, growth, and strong and stable macro-economic environment. It is divided based on 7 priorities:
- Inclusive development
- Reaching the last mile
- Infrastructure & investment
- Unleashing the potential
- Green growth
- Youth Power
- Financial sector
We feel that the budget has maintained a good balance between fiscal prudence and capex expenditure. The capex spending is expected to boost local manufacturing and drive the growth. It also has given equal importance to infrastructure spending, consumption and also managed to leave some money in hands of the citizens by tweaking the tax regime. The infrastructure spend is expected to improve the end-to-end connectivity for businesses by improving the supply chain. The last mile reach reflects the Government’s commitment towards improving the livelihood of the rural as well as the tribal community. The budget also stresses on skilling the youth in the fields of coding, AI, 3D printing, Robotics etc. and will roll out an apprenticeship programme with stipend transferred via direct benefit transfer (DBT). This will create more skilled work force in the coming year.
Overall, even though the elections are due, the government has decided not to give a populous budget and maintain a good balance keeping growth at the centre.
Some key highlights of the budget:
- FY23 Fiscal Deficit Target retained at 6.40%
- FY24 Fiscal Deficit estimated at 5.90%. FM wows Fiscal Deficit to be at 4.50% by 2025
- For this fiscal year, the revised estimate of the total receipts other than borrowings is Rs 24.3 lakh crore, of which the net tax receipts are Rs 20.9 lakh crore.
- The revised estimate of the total expenditure is Rs 41.9 lakh crore, of which the capital expenditure is about Rs 7.3 lakh crore.
- For the next fiscal year, the total receipts other than borrowings are estimated at ₹ 27.2 Lakh Crore. The Net Tax Receipts are estimated to be at ₹ 23.3 Lakh Crore. The total expenditure is expected at ₹ 45 Lakh Crore.
- For financing the fiscal deficit in 2023-24, the net market borrowings from dated securities are estimated at Rs 11.8 lakh crore. The gross market borrowings are estimated at Rs 15.4 lakh crore
- FY24 net borrowing is estimated at ₹12.31 Lakh Crore
- Garib Kalyan Yojana (food for poor) for 2023 calendar year is budgeted at 2 lakh crores and to be fully funded by centre
- ₹ 13.7 Lakh crore effective Capex (4.50% of GDP)
Agriculture and Co-operatives:
- ₹ 10 Lakhs crore agricultural credit (Animal Husbandry, Fisheries & Diary Sector)
- Agriculture Accelerator Fund for innovative start-ups in rural areas
- Making India Global Hub for Millets
- Decentralised Storage facilities for farmers
- Boost production of high value horticulture crops
Health, Education & Skilling:
- 157 new nursing colleges
- New programme for promoting Pharmaceutical Research
- National Digital Library for children and adolescents
- Panchayat and ward level physical libraries
- Revamped Teachers’ Training
Last Mile Reach:
- Vulnerable Tribal Group Development Mission to be launched
- Recruitment of 38,000 teachers for 740 Modern Ekalavya Schools for Tribals
- Financial Assistance to draught prone areas of Karnataka for Drip Irrigation
Infrastructure & Investment:
- ₹ 2.40 Lakh crore capital outlay for Railways (Highest ever)
- 100 transport infrastructure projects for end-to-end connectivity for ports, coal, stell & fertilizer sectors
- Creating Urban infrastructure in Tier 2 & 3 Cities
- Incentives to promote usage of alternative fertilizers
- 500 new ‘waste to wealth’ plants
- Green Credit Program for incentivising sustainable actions
- Setting up 10,000 bio resource centres for natural farming
Youth Power & Tourism:
- Skilling the youth in the fields of 3D Printing, AI, Coding, Robotics etc.
- Govt to provide stipend support to 47 lakh youths under DBT
- 50 destinations selected to boost domestic and international tourism
- Unity Malls in each state for promotion and sale of one district and one product & local handicraft products.
Finance & Taxation:
- One-time new small savings scheme for up to ₹ 2 lakhs for women
- Maximum limit for Senior Citizen Savings Scheme enhanced to ₹ 30 Lakhs
- Maximum deposit limit for Monthly Income Account Scheme will be enhanced from Rs 4.5 lakh to Rs 9 lakh for a single account and from Rs 9 lakh to Rs 15 lakh for a joint account
- Micro enterprises with turnover up to ₹2 crore and certain professionals with turnover of up to ₹50 lakh who avail the benefit of presumptive taxation is proposed to be enhanced to ₹3 crore and ₹75 lakh respectively, for taxpayers whose cash receipts are no more than 5%.
- Benefit of transfer of shareholding for Start-ups increased from 7 years to 10 years
- Income from traditional insurance policies where the premium is over Rs 5 lakh will no more be exempt from taxes
- Tax deduction on capital gain through reinvestment in residential house property capped at ₹ 10 Crore
- The capital gains on market linked debentures (MLDs) will be taxed as short-term capital gains
- TDS on taxable withdrawal of EPF reduced to 20% from 30%
- New tax regime will be the default tax regime (people can still choose to continue in the old regime)
- Basic tax-free income limit increased to ₹7L from ₹5L under New Income Tax Regime
- Standard Deduction extended to New Income Tax Regime
- Reduce the highest surcharge effecting the highest tax rates to drop from 42.7% to 39%
- Leave Encashment on retirement limit enhancement to ₹ 25 Lakhs
- Revised Tax Rates for the New Income Tax Regime
|Income Slab||New Tax Rates|
|Up to ₹ 3 Lakhs||Nil|
|> ₹ 3 Lakhs up to ₹ 6 Lakhs||5%|
|> ₹ 6 Lakhs up to ₹ 9 Lakhs||10%|
|> ₹ 9 Lakhs up to ₹ 12 Lakhs||15%|
|> ₹12 Lakhs up to ₹ 15 Lakhs||20%|
|Above ₹ 15 Lakhs||30%|
Note: This is an extract from the information available on various media regarded as reliable. You should refer the fine print of the budget for details.