By Gunjan Prabhakaran
Union Budget 2021: After becoming battered by the Covid-19 induced lockdowns and shutdowns, Union Budget 2021 was largely anticipated to reaffirm the Government’s commitment to the economy and signal an era of recovery and steadfast improvement in the nation.
With all eyes on the price range, not just domestically but internationally as properly, the Hon’ble Union Finance Minister, Ms. Nirmala Sitharaman, presented the substantially-anticipated price range for the Fiscal year 2021-22. From the really starting, she reiterated the Government’s commitment to attaining the USD 5 trillion milestones and conveyed that the price range proposals rest on 6 critical pillars viz.
1. Health & Wellbeing
2. Physical and Financial Capital and Infrastructure
3. Inclusive improvement for Aspirational India
4. Reinvigorating human capital
5. Innovation and R&D
6. Minimum Government – Maximum Governance
Under every of these broad concentrate places (pillars), the FM proceeded to clarify her proposals and the funding allocated for every measure, guaranteeing that just about every crucial aspect of the economy is addressed.
With an emphasis on the implementation of Pradhan Mantri Atmanirbhar Swasth Bharat Yojna in addition to the National Health Mission, the Government has signalled to strengthen the country’s healthcare infrastructure and have a tendency to the general care and well-being of the citizens which includes measures to assist overcome the pandemic.
With a extended-term vision of creating India a worldwide investment location, the Government allocated a Capex spending of INR 5.54 lakh crores in the Fiscal Year (34% improve more than the earlier year) to create infrastructure. Out of this INR 1.97 lakh crores more than 5 years shall be earmarked for Productivity Linked Incentive Schemes (PLIs).
The Government has also announced a slew of measures which includes setting up of 7 Mega-Investment Textile parks with globe-class infrastructure to market the textile business and setting up of a Development Financial Institution, monetisation of assets of NHAI, PGCIL, GAIL, IOCL and HPCL, launch of Hydrogen Energy Mission and management of Ports beneath the PPP Model and so forth, which are all aimed at the improvement of physical and economic infrastructure in the nation.
Measures to market agriculture and allied sectors and to assist migrant labourers by way of upskilling and education have also been proposed, and allocations to the tune of INR 40,000 crores to the Rural Infrastructure Development Fund and INR 5,000 crore to the Micro-Irrigation fund have been produced in this regard.
With regard to tax measures, the Government supplied relief from revenue tax to senior citizens aged more than 75 years with only pension revenue. Even even though some revenue tax relief was sought by salaried taxpayers, they ended up acquiring the brief finish of the stick in this price range as properly.
On an administrative front, provisions relating to assessments and proceedings have been relaxed to provide relief to little taxpayers who have been undergoing serious hardships due to prolonged hearings and investigations.
On an indirect tax front, the price range proposed rationalisation of Customs Duties in a bid to market domestic manufacturing by lowering duties on inputs and escalating duties on completed goods. Various sectors ranging from metals and mining, textiles, automobiles, and renewable power have been covered beneath these measures.
In addition to the above, the Government has also proposed the levy of an Agricultural Infrastructure Development Cess on particular restricted goods to assist modernise the agricultural sector and provide the substantially-necessary infrastructure to enhance production and distribution.
On ease of compliance, amendments have been proposed to take away the requirement for GST Audit in favour of self-certification and higher powers have been conferred on the tax authorities for successful and effective tax administration.
Overall, the price range is all-encompassing and progressive, paving the way for a resilient economy.
(Gunjan Prabhakaran is Partner & Leader – Indirect Tax, BDO India. Views expressed are the author’s personal.)