Earlier, Union Budget was presented every year on the last working day of February by the Finance Minister of India in Parliament. Since 2017, then Finance Minister Arun Jaitley started to present the Union budget on 1 February in the Parliament.
First of all, let us know what Union Budget is and why it is presented every year.
What is Union Budget?
If we want to define Union Budget, according to Article 112 of the Indian Constitution, the Union Budget of a year is a statement of the estimated receipts and expenditure of the government for that particular year. The Union Budget is also termed as the Annual Financial Statement.
Due to the bad health of Finance Minister Shri Arun Jaitley, the Railway minister Shri Piyush Goyal is appointed as interim Finance minister. Piyush Goyal (Interim finance minister) presented the interim budget on 1st February 2019.
After the new Government formed, the first Union Budget 2019-20 of Modi Government for its second tenure was presented by Finance Minister Nirmala Sitharaman on 5th July 2019.
Sitharaman is the second woman finance minister of India after Indira Gandhi. According to the finance minister, the 2019 union budget is focused on “Gaon, Gareeb and Kisan”.
In this blog, we are going to discuss the highlights of the Union Budget 2019-20 and the major announcement made for different sectors.
Have a look!!
Key Highlights of the Union Budget 2019-20
The Role of women through women led initiatives will be encouraged by facilitated.
PAN and Aadhaar card will be allowed to use interchangeably to file the Income tax returns.
NRIs having Indian passport will get Aadhaar card without mandatory waiting period.
All families will be facilitated power, cooking facility by 2022 and water to rural homes by 2024.
Surcharged enhanced by 3% for the individuals having income 2-5 crore while 7% for the income 5 crores and more.
The fuel to be costlier as special additional duty and road and infrastructure cess on diesel and petrol to be increased by Rs 2/liter.
Lower GST Rates on Electrical Vehicles and additional income tax deduction of 1.5 Lakh on interest on loans to purchase Electrical Vehicles.
Waived off the charges on an online transaction to promote the digital payments.
Effect of Union Budget 2019-20 on Taxes
2% TDS will be applied on withdrawal of Rs 1 Crore in a year.
Hiked the Excise duty on fuel by Rs 1.
3% and 7% surcharge on the income of Rs 2 Crores and Rs 5 Crores respectively.
No Income tax for the income less than 5 Lakh.
Corporates Tax of 25% for companies having an annual turnover of Rs 400 Crore.
Aadhaar card can be used interchangeably to file the ITR for those not having the pan card.
GST on Electric Vehicles is proposed to reduce to 5% from 12%.
Union Budget Effect on Housing
Reformed the Rental laws. Modern tenancy laws will be shared with states to promote house renting.
Deduction of 1.5 Lakh in taxes on home loans for buying affordable housing of up to 45 Lakhs before 31st March 2020 and tax benefit of 7 lakh over the period of interest deduction.
1.95 crore houses will be provided to eligible beneficiaries.
Union Budget 2019 for Employments/ MSME
New TV programme for start-ups under Doordarshan, designed and run by start-ups themselves.
Proposed easing Angel tax for Startups.
E-verification to identify the investor identity and source of funds for startups.
New payment platform to be created for MSMEs.
Effect of Union Budget 2019 on Women Empowerment
Women Self-help Groups (SHGs) Interest Subvention to be expanded to encourage the women entrepreneurship in all districts of India.
One woman in every self-help group is eligible for loan of Rs. 1 lakh under Mudra scheme.
An overdraft of Rs 5,000 will be allowed for every woman SHG member having a Jan Dhan account.
Union Budget Effect on Social Welfare and Pension
3 Crore retail traders to be benefited with the pension.
Pension for shopkeepers, retailers with a turnover less than Rs. 1.5 crore under Pradhan Mantri Karam Yogi Man Dhan Scheme.
Multiple labour laws to be consolidated and streamlined into only four codes.
Effect of Union Budget on Education
National Research Foundation to be established to fund, coordinate and promote research in the country.
New National Educational Policy proposed to transform the Indian educational system; major changes in higher as well as the school system to be introduced. Focus on bringing in foreign students.
The Stand-Up India Scheme which focuses on skill development has been extended up to the year 2025.
Union Budget Effect on Rural India and Agriculture
Rs. 80250 located to upgrade roads under PM Gram Sadak Yojana.
New Jal Shakti ministry formed which will work with states to ensure the “Har Ghar Jal” for all rural houses by 2024.
Electricity to all rural family by 2022.
Government to promote 10000 new farm produce organization and Zero budget farming.
Effect of Union Budget 2019 on Economics and Investment
Fiscal deficit in FY 19 is projected at 3.3% of the GDP.
To become a $3 trillion economy (from $2 trillion) in fiscal 2020.
To invest raising FDI in media, animation and aviation sector. 100% FDI for Insurance Intermediaries.
Proposed Rs. 80,000 Crores to upgrade 1.25 KM roads nationwide.
Rs. 50 lakh crores proposed for Railway Infrastructure.
Inter-operable One Nation One transport card for universal travel on various modes of transport (metro, road, railways etc.).
PPP to be used to unleash faster development and the delivery of passenger freight services.
Suggest using rivers for cargo transport to decongest roads and railways.
Modernization of railway stations to be launched in soon. The PPP model will be used to speed up the Indian Railway projects.
17 iconic world-class tourist sites will be developed to boost the tourism in India.
Annual Global Investors' Meet to attract global companies to come and invest in India.
New Space India Limited (NSIL) has been incorporated to tap benefits of ISRO.
BharatMala, Sagarmala and UDAN schemes are proposed to bridge rural urban divide and improving our transport infrastructure.
Similar to Wikipedia, 'Gandhipedia' will be introduced to spread positive Gandhian values among the youth.
Top Reaction of Prominent People on the Union Budget 2019-20
“Ye desh ko samridh aur jan jan ko samarth banane wala budget hai. Is budget se gareeb ko bal milega. yuva ko behtar kal milega”.
The budget was citizen-friendly and development-friendly. “There is ease of living for people. Country is full of hope,”
PM Narendra Modi
“Inspired by the mantra of ‘Sabka Saath, Sabka Vikas and Sabka Vishwas’ the Union Budget 2019-20 has not only outlined the vision for ‘New India’ but it is also focused on bringing a qualitative change in people’s lives”.
“At best, it was an incremental Budget. No bold steps. No visionary things. Maybe, I should call it a supplementary Budget”
Eminent Economist Swaminathan Aiyar
"It is vision-less and provision-less".
Kapil Sibal, Congress MP
“An utterly lacklustre, nondescript, uninspiring & directionless Budget 2019. Zero on Economic Revival. Zero on Rural Growth. Zero on Job Creation. Zero on Urban Rejuvenation. Can a mundane jugglery of ‘acronyms’ pass off for vision for a ‘New India’?”
Randeep Singh Surjewala, Congress spokesperson
“Union Budget will take the country towards greater transparency through greater use of technology + accountability. She makes rich pay more while others remain undisturbed. All earlier development schemes and more are strengthened. It’s a bottom-up, inclusive budget.”
Kiran Bedi, Puducherry Governor
Interim Union Budget 2019 - Know the Major announcements
The major announcement made by Finance Minister Shri Piyush Goyal, while presenting the Interim Union Budget 2019-20 on 1 February are as follows: -
We will understand the major challenges and roadmaps which have been set this year in various sectors by the Finance Minister Mr. Piyush Goyal, with the help of the following points:
Highlights of the Union Budget 2019
Basic Income Tax rebate up to INR 5 lakh.
INR 6000 Direct income support to 12 crore marginal farmers.
Pension scheme for unorganized sector workers with monthly income up to INR 15000. Assured INR 3000 monthly pension after 60 years of the age. Highest ever allocation for defense i.e. 3 lakh crore.
2% interest subvention to affected farmers and additional 3% relief on timely loan payment.
Impacts on Agriculture Sector
All farmers affected by severe natural disasters to get 2% interest subvention and an additional 3% subvention on timely loan repayment.
Under Pradhan Mantri Kisan Samman Nidhi scheme, INR 6,000 per year will be given directly into the bank account to each farmer having up to 2-hectare land.
Under the National Gokul mission, INR 750 crore allocated to set up Rashtriya Kamdhenu Aayog for cow welfare.
2% interest subvention to farmers for animal husbandry.
Create a separate department for fisheries.
Announced a hike in minimum support price by 1.5 times for all 22 crops.
Impacts on Social Sector
To give 8 crores free LPG connections to rural households under Pradhan Mantri Ujjwala Yojana to ensure cleaner fuel and health assurance. As of now, total 6 crore connections have been given already under the scheme.
A single window clearance for filmmaking to be made available to filmmakers.
Introduced anti-camcording provision to Cinematography Act to fight piracy.
The Finance Minister announces higher allocation for MNREGA for rural job creation.
Impacts on Taxation
The taxation process will be simplified and done electronically within two years.
The income tax exemption limit increased to INR 5 lakh from the current INR 2.5 lakh. Individual taxpayers with annual income up to INR 5 lakh to get a full tax rebate.
Individuals with gross income up to INR 6.5 lakh will not need to pay any income tax if they make investments in provident funds and prescribed equities.
Exemption on levy of income tax on notional rent on a second self-occupied house is also now proposed. Currently, income tax on notional rent is payable only if one has more than one self-occupied house.
Recommendations to GST council for reducing GST rates for home buyers.
Impacts on Banking Sector
Fiscal deficit has been come to 3.4%, CAD (Current Account Deficit) likely to be 2.5% of GDP this year.
The government has hiked TDS limit to INR 40,000 from INR 10,000 on the post office, bank savings.
No TDS on rental income up to INR 2,40,000 per year.
Standard Deduction raised to INR 50000 a year from previous INR 40000 per year.
Gratuity limit increased from INR 10 lakh to 30 lakh rupees.
Impacts on Investments and infrastructure Sector
Construction of Rural Roads has been tripled. Pradhan Mantri Gram Sadak Yojana INR 19,000 crore in FY 2019-20.
National Artificial Intelligence portal to be developed soon.
Jan Dhan Aadhar Mobile scheme announced to make 1 lakh digital villages in 5 years.
Impact on Transport Sector
The government has increased Capital Expenditure for the Railways to INR 1.59 lakh crore.
Vande Bharat Express, an indigenously developed semi high-speed train, to be launched.
Allocations for Various Schemes:
Pradhan Mantri Gram Sadak Yojana (PMGSY) is being allocated INR 19,000 crore in 2019-20 as against INR 15,500 crore in 2018-19.
All households will be provided with electricity connection by March 2019. Till now, 143 crores LED bulbs have been provided in a mission mode which has resulted in saving of INR 50,000 crore for the poor and middle class.
To provide medical treatment to nearly 50 crore people in the country under Ayushman Bharat healthcare programme. Around 10 lakh patients have already been benefited through free medical treatment.
North-east states to get 21% higher budget allocation at ?58,166 crore in financial year 2020.
INR 76,800 crore allocated for welfare of SCs/STs.
All households will be provided with electricity connection by March 2019.
Finally, in a short conclusion of the Union Budget 2019, the Finance Minister Arun Jaitley tried to please the farmers and rural population.
List of Important 10 Dimensions of Government's Vision 2030 for India
Presenting the Interim Budget 2019, Mr. Piyush Goyal has also unveiled the 10 important dimensions of the government’s vision for India in 2030. Here we are presenting the list of 10 dimensions of the vision 2030 of India as following:
1) Physical & Social Infra
2) Digital India
3) Clean and Green India
4) Rural Industrialization
5) Clean Rivers
6) Oceans and Coastline
8) Self-sufficiency in Food Production
10) Minimum government and max governance
Eduncle provides all the details and major highlights of the Union Budget 2019-20. You can share your thoughts with us on the Union Budget 2019-20. Share your views or comments in the comment box provided below.