Indian Union Budget 2023-24: Key highlights

India's Union Finance Minister Nirmala Sitharaman presented the Union Budget 2023-24 on Wednesday. She kicked off her speech by saying that the "world has recognised India as a bright star" and added that the country is recording healthy economic growth despite global uncertainties. Sitharaman was presenting her fifth full Budget after she took over as Finance Minister in July 2019.

Economic growth

Sitharaman, the Union Minister of Finance and Corporate Affairs,said that the Indian economy is on the "right track and heading towards a bright future". India's growth at 7 per cent in the current fiscal is the highest among major economies, she said in her Budget speech. Indian economy has increased in size from being the 10th to 5th largest in last nine years, she said, stating that the per capita income has increased to Rs 1.97 lakh.

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“Our focus on reforms and sound policies resulting in ‘Jan Bhagidari’ helped us in trying times, our rising global profile is due to several accomplishments,” she said.

Sitharaman also fixed the fiscal deficit for 2023-24 at 5.9 per cent. She reiterated that the fiscal deficit would be brought down to below 4.5 per cent by 2025-26 as declared earlier.

Also Read |Sitharaman's 5 announcements on personal income tax

Income Tax

There was good news for taxpayers as Sitharaman announced thatthe tax rebate limit is beingincreasedfrom Rs 5 lakh to Rs 7 lakh. A change in the number of Income Tax slabs was also announced. Government also proposed to reduce highest surcharge rate from 37 per cent to 25 per cent in the new tax regime.

"I introduced in 2020, the new personal income tax regime with six income slabs, starting from Rs 2.5 lakh. I propose to change the tax structure in this regime by reducing the number of slabs to 5 and increasing the tax exemption limit to Rs 3 lakh," she said.

An individual with income of Rs 15 lakh will have to pay Rs 1.5 lakh as tax, down from Rs 1.87 lakh. The new tax regime will now be the default tax regime, she further said.

Revised tax slabs under new tax regime:

— Income of Rs 0-3 lakh is nil.

— Income above Rs 3 lakh and up to Rs 5 lakh to be taxed at 5%

— Income of above Rs 6 lakh and up to Rs 9 lakh to be taxed at 10%

— Income above Rs 12 lakh and up to Rs 15 lakh to be taxed at 20%

— Income above Rs 15 lakh to be taxed at Rs 30%

Watch:Indian Finance Minister Nirmala Sitharaman presents Union Budget

Other proposals in the Budget

The Centre launched a Rs 15,000 crore development fund for the tribal and marginalised sections, the finance minister announced in her speech. "Pradhan Mantri PVTG (Particularly Vulnerable Tribal Groups) Development Mission is being launched to improve the socio-economic condition of the vulnerable groups. A total of Rs 15,000 crore will be made available to implement the scheme in the next three years," the FM said.

To promote exports and enhance domestic manufacturing, Sitharaman announced a reduction in customs duty rates on various commodities and products. A reduction in the number of customs duty rates on goods except for textiles, from 21 to 13, was also proposed. The government will also continue concessional duties on lithium ions cells for batteries for one more year.

Regarding India's carbon emissions, Sitharaman announced that the country is swiftly moving towards reaching its Net-Zero targetby 2070. The National Green Hydrogen Mission, which has an allocation of Rs 19,700 crore, will facilitate the transition of the economy into a low-carbon intensity and green economy.

The government will revive up to50 additional airports, heliports, water aerodromes and advance landing grounds to improve regional air connectivity in the country.

Sitharaman proposed to use PAN card as a common identifier for all digital systems at government agencies. The move is expected to simplify the KYC process and make it easier for the Income Tax Department and other government agencies to manage documents.

On foodgrains for poor, Sitharaman said that the entire expenditure of about Rs 2 lakh crore under the PM Garib Kalyan Anna Yojana is being borne by the Central government. Under it, free foodgrains are being supplied to all Antyodaya and priority households for a year.

In a bid to support and encourage agri-startups by young entrepreneurs, the FM announced the setting up of the Agriculture Accelerator Fund. The government proposes to increase the agricultural credit target to Rs 20 lakh crore with a focus on animal husbandry, dairy and fisheries, she told the Parliament.

A national cooperative database is being created to map cooperative societies. The move would help in better implementation of the proposed national policy on cooperatives. As per the data published by the NCUI, there are about 8.6 lakh cooperatives in the country, out of which active primary agricultural cooperatives (PACs) are about 63,000.

She also announced a 66 per cent hike in the Pradhan Mantri Aawas Yojana (PMAY) outlay to Rs 79,000 crore. She said states and cities will be encouraged to take up urban planning.

The Centre would provide Rs 5,300 crore assistance for Upper Bhadra project in poll-bound Karnataka. In her budget speech, Sitharaman said, "In the drought prone central regions of Karnataka, a central assistance of Rs 5,300 crore will be given for the Upper Bhadra Project."

(With inputs from agencies)

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