UNION

BUDGET

(2019-20) Presented by

Neha Sand
Krishna Italia
Rukmani Gupta
 UNION • According to Article 112 of the Indian Constitution, the
Union Budget of a year, also referred to as the annual

BUDGET financial statement, is a statement of the estimated

receipts and expenditure of the government for that
particular year.

• The Union Budget contains details about the projected

receivables and payables of the government for a
particular fiscal year. This budget statement is divided
into two major parts—

1. capital budget and

2. Revenue budget.
• Capital budget
Capital budget accounts for government-related capital payment and receipts. Capital
receipts include loans from the public or that from the Reserve Bank of India (RBI),
while capital payment includes expenses incurred towards health facilities, development
and maintenance of equipment, as well as educational facilities.

• Revenue budget
As the name suggests, a revenue budget accounts for all the revenue expenditure and
receipts. If the revenue expense is in excess of the receipts, the government suffers a
revenue deficit.
 Tax • Income Tax slab will remain the same for FY 2019-20.

proposals • No tax on notional rent of second Self-occupied House

2019-2020 under “Income from House Property” i.e. up to two self-

occupied house properties to be considered for
at a glance exemption.

for • Individual taxpayers having taxable annual income up to

Individuals Rs 5 lakh will get full tax rebate, therefore, will not be
required to pay any income tax.

• People with gross taxable income up to Rs 6.5 lakh will

have to pay no tax if they utilize the maximum benefit of
Rs 1.5 lakh available under section 80C.
• Tax Rebate Limit under 87A increased from Rs. 3.5 lakhs to Rs. 5 lakhs for
taxpayers. The maximum limit of the tax rebate increased to Rs.12,500 from the
present limit of Rs. 2,500.

• TDS limit under Section 194A hiked from Rs 10,000 to Rs 40,000 on Post Office
Savings and Bank Deposits.

• Standard Deduction for the salaried class increased from Rs 40,000 to Rs 50,000.

• Section 54 exemption now available on the second house property, provided the
capital gains is less than or equal to Rs. 2 crores – to be availed only once in a
lifetime.
 Tax • Benefits under Section 80-IBA to be extended
for one more year – to the housing projects
proposals approved till 31 March 2020.
2019-2020 at
a glance for • Period of exemption from levy of tax on
notional rent, on unsold inventories is extended
Businesses, from one year to two years, starting from the
MSME & end of the year in which the project is
completed.
Real estate
• SMEs with earnings below Rs 5 Crores will
soon file GST returns only once in 3 months.
• MSMEs and Traders to note that GST Registered SME units will get 2% interest
rebate on an incremental loan of Rs. 1 Crore.

• The requirement of sourcing from SMEs by Government enterprises has been

increased to 25% with 3% reserved for women-owned SMEs.

• A scheme of ‘Business loans up to Rs. 1 crore in 59 minutes’ will be

implemented.

• Limit to deduct TDS on Rent under Section 194I has been increased from Rs
1,80,000 to Rs. 2,40,000.
Income tax slabs comparison FY 19-20 Vs FY 18-19
Income range
Tax Rate FY 2019-20, AY 2020-21 Tax Rate FY 2018-19, AY 2019-20
per annum
Up to Rs. 2.5
No Tax No Tax
lakhs
Above Rs. 2.5
lakhs to Rs. 5 5% + 4% cess 5% + 4% cess
lakhs
Above Rs. 5
lakhs to Rs. 10 20% + 4% cess 20% + 4% cess
lakhs
Above Rs. 10
lakhs to Rs. 50 30% + 4% cess 30% + 4% cess
lakhs
Above Rs. 50
lakhs to Rs. 1 30% + 10% surcharge + 4% cess 30% + 10% surcharge + 4% cess
crore

Above Rs. 1 crore 30% +15% surcharge + 4% cess 30% +15% surcharge + 4% cess

100% tax rebate subject to maximum of Rs. 100% tax rebate subject to maximum of Rs.
Rebate under 12,500 available to resident individual 2,500 available to resident individual whose
section 87(A) whose net taxable income does not exceed net taxable income does not exceed Rs. 3.5
Personal Proportionate exemption on long-term capital
gains arising from proceeds of sale of residential
tax house extended to purchase of two residential
houses from one house, subject to:

• Amount of capital gain not exceeding INR 2

crore [no monetary threshold continues for
investment in one residential house]

• One-time opportunity to claim such exemption

Indirect • The Government has estimated the CGST
collection for FY 2019-20 at INR 6.10 lakh crore.

Taxes This assumes a growth of around 20% over the

revised estimate FY 2018-19 at INR 5.04 lakh
crore.

• Given that overall growth in GST collection in the

current year over last year is only 8% (INR 97,100
crore vs INR 89,700 crore on a month-on-month
basis).It will need substantial expansion in the tax
base and stringent control over revenue leakages.
Stamp Duty • The proposed amendments in stamp duty provisions
are largely aimed at rationalizing the various stamp
duty provisions as well as streamlining the stamp
duty collection mechanism.

• It is intended to designate stock exchanges and

depositories to collect stamp duty on sale or transfer of
securities.

• Such collection will be transferred to the respective

state government within the prescribed time.

• The amendments also propose changes to the rates of

duties.

• It also appears that exemption of stamp duty on

transfer of dematerialized shares is proposed to be
done away with.
Source: • https://www.pwc.in/assets/pdfs/budget/2019/interim-
budget-2019-highlights.pdf

• https://cleartax.in/s/interim-budget-2019