Budget 2021 In-shorts

Finance Minister (FM) Nirmala Sitharaman has presented the Union Budget 2021 of India on
the 1st of February, 2021. Here are the key Highlights from Budget 2021:

 Our Hon’ble Union Finance Minister nsitharaman has started presenting the
Budget2021.
 Our FM starts the budget2021 announcement by mentioning the challenges during the
pandemic and the vision of the Pradhan Mantri Garib Kalyan Yojana.
 FM says that India has two #COVID19 vaccines made available and two more will be
made accessible soon.
 FM reiterated that the government is fully prepared to support the economy's reset.
 FM says the Budget2021 is based on 6 pillars.
Starting with healthcare & wellbeing:
1. Spending's been increased
2. New scheme with an outlay of Rs.64K crore to be spread over 6 yrs
3. The above is in addition to the National Health Mission
4. Support to rural & urban health centres
 FM announces the Jal Jeevan Mission with an outlay of 2.87 lakh crores aiming to
provide full-fledged water supply to all urban local bodies with household tap
connections.
 The FM proposed Rs1.41 lakh crores over a period of 5 Years for the Urban Swacch
Bharath 2.0.
 An amount of Rs.1.47 lakh crores, over a 5-year-period, from 2021 has been assigned
for initiatives such as wastewater treatment, reduction in plastic waster, reduction in
pollution and the like.
 The Scrapping Policy has been announced in the Budget2021. The voluntary vehicle
scrapping policy aims to remove inefficient vehicles so as to reduce vehicular
pollution and oil import bills.
 FM proposes an amount of Rs.35000 crore to manufacture and make accessible the
COVID19 vaccine.
 2nd Pillar of Budget2021:
1. Focus on physical, financial capital and infrastructure
2. FM proposes an amount of Rs. 1.97 lakh crores, over 5 years, starting this FY
to nurture global manufacturing champions and increase jobs for the youth
 FM has proposed a mega-investment textile park to be launched along with 7more
textile parks to be established over the next 3 years.
 The FM proposes to set up a Development Financial Institution with an amount of
Rs.5 lakh crores
 FM states that the Budget2021 will focus on the NHAI operational toll roads, airports
in tier-2 and 3 cities, and sports stadiums
 The capital expenditure for the year 2021-22 will be 5.54 lakh crore with a 34.5% Y-
o-Y growth rate.
 Our FM announced that more than Rs.2 lakh crores will be allocated for capital
expenditure in the states and other autonomous bodies.
 FM announced that till date, a measure of 3,800 km highway-stretch has already been
constructed and an additional km will be constructed under Bharat Mala project.
 The FM proposed the following National Highway budget for the below states:
1. Tamil Nadu: 3500km @Rs. 1.03 lakh crores
2. Kerala: 1100km @Rs.65,000 crores
3. West Bengal: 675km @Rs.25,000 crores
o Also, National highway project of around 19,000 crores is in progress in
Assam.Overall, the FM proposes a total of Rs.1,18,101 lakh crore for Ministry
of Road Transport and Highways.
o An Infra-National Rail plan to prepare a future rail system in India by 2030
has been proposed to bring down logistics cost.
o The next few phases of metro projects will be taken up in Metro cities. Also in
line are the 'Metro Lite' & 'Metro New' concepts for tier 1& 2 cities.
o The FM proposed to extend Ujjwala Scheme up to 1 crore beneficiaries from
the existing 8 crore beneficiaries.
o The FM proposes to focus on the various allied laws of the securities market to
be merged to the Securities Market Code.
o FM announced that the #SEBI will be notified to regulate the setting up and
arrangement of the commodity market system.
o FM grants Rs.1,000 crores to the Solar Energy Corporation of India for the
growth of the Solar Energy Sector.
o FM proposed to amend the Insurance Act to introduce additional FDI to
insurance companies from the existing 49% to 74%.
o FM announces that a new Asset Reconstruction Company is to be set up to
provide resolution to stressed assets in PSUs.
o The FM proposed to amend the DICGC Act, 1961 to streamline its provision
where the depositors of the bank can get easy access to deposits through
insurance in the case of a stressed bank.
o The FM announced that de-criminalization under the Companies Act, 2013 is
complete and now the decriminalization of LLP Act, 2008 will be in force.
o Our FM modified the definition of small companies: companies with a paid-up
capital not exceeding 2cr & a turnover not exceeding 20cr are to be considered
small companies. Over 2 lakh+ companies benefit from this provision.
o For Startups and Innovators, the FM announced that the OPC can be
incorporated without a limit for turnover or paid-up capital. This also allows
NRIs to incorporate OPC in India.
o Our FM proposes a special framework for MSME.
o The FM announced that MCA 21 V3.0 to be introduced with additional
modules for e-scrutiny and e-adjudication.
o FM stated that the IPO of the LIC will be carried out in FY 2021-22. Also, for
the disinvestment strategy, two PSUs and 1 insurance company will be
considered.
o The FM informed that the 15th Finance Commission's recommendation is to
rationalize and reduce centrally sponsored schemes.
o Pillar 3 of the Budget2021:Inclusive development for aspirational India
o In the Agriculture sector, the MSP regime has undergone a change to provide
1.5 times the product cost across all commodities.
o The total amount paid to wheat farmers was doubled in 2019-20 when
compared to 203-14.
o The FM announced that agricultural credit will be increased to 16.5 lac crore.
o The FM proposed to enhance the scope of the 'Operation Green Scheme' to
include 22 perishable crops, and 1.68 crore farmers have registered. Also,
1,000 mundis to be integrated under the said scheme.
o The FM stated that the government will take up the development of fishing
harbors and fish landing centers along the banks of rivers and waterways.
o The FM announced that the '1 nation-1 ration card' plan has been implemented
by 32 States and UTs. Migrant workers benefit from this scheme as they can
claim ration from anywhere in the country.
o The total fiscal deficit is pegged at 9.5 % of GDP and it is funded through govt
borrowing. An additional 80,000 crore is needed to ensure our economy is
given the needed push.
o The borrowings from the market for next year will be at 12 lakh crores.
o FM announced that the senior citizens who get only pension and interest on
income are not required to file ITR.
o Reopening of assessment:
1. In normal cases: the time limit has been reduced to 3 years from 6 years.
2. In serious tax evasion cases: can be reopened till 10 years, only when
concealment of income is more than 50 lakh.
o FM announced that the 'Faceless dispute resolution committee and mechanism'
is set up to reduce litigations for small taxpayers. Any taxpayer with taxable
income up to 50 lakh and disputed income up to 10 lakh can approach the
committee.
o FM proposed a faceless Income Tax Appellate Tribunal (ITAT) for providing
online resolution.
o In a major move, the limit for tax audits under section 44AB has been
increased from Rs 5 crore to Rs 10 crore
o The FM announced that the 'advance tax liability' on dividend income shall
rise only after the declaration or payment of dividend.
o The FM announced that the deduction under section 80EEA is to be extended
to loans taken up to 31st March 2022.
o FM announced that the affordable housing projects can avail tax holiday until
31 March 2022.
o FM announces tax incentives for the IFSC and tax holiday for aircraft leasing
and rental companies.
o FM announces the pre-filled #ITR in Budget2021: Salary, Tax Payments, TDS
are already pre-filled. Capital Gains, dividend incomes, and interest income
will now be pre-filled.
o FM states that in case the PF amount was deducted but not deposited by the
employer, it will not be allowed as a deduction for the employer.
o FM announces that the deduction under section 80IAC will be extended upto
31st March 2021.
o Under Indirect Taxation, the FM proposes to review 400 old exemptions this
year through extensive consultations. After which a revised customs duty
structure will be introduced.
o The FM has rationalized customs duty on copper, textile, gold and silver.
o The FM raised customs duty on solar inverters from 5% to 20% and solar
lanterns from 5% to 15%.
o The FM proposed to withdraw exemption on import of leather as they are
domestically produced.
o The FM proposes ‘Turant Customs’ initiative for faceless, paperless, and
contactless customs measures.
o The FM concluded the Budget2021 and the house has been adjourned after
getting the consent for the Finance Bill, 2021.