Interim
Budget 2019-20 was presented in Parliament today by the Union Minister
for Finance, Corporate Affairs, Railways & Coal, Shri Piyush Goyal.
Besides having a major Scheme for the farmers, it provides tax sops and
sets the Developmental Agenda for the years to come.
A
New Deal for 12 Crore Small and Marginal farmers with direct income
support, a path breaking Pension initiative for 10 Crore unorganized
sector workers, exempting income up to Rs 5 lakhs from Income Tax,
reforms in stamp duty, highest ever budgetary allocation of Rs 3 lakh
crore for Defence, record allocation of funds at Rs 58,166 crore for
North Eastern Areas, a new AIIMS for Haryana, single window clearance
for Indian film makers at par with foreigners and higher budgetary
allocations for Education, Health, Infrastructure and for the welfare of
weaker sections including Scheduled Castes and Scheduled Tribes, a
Separate Department of Fisheries for welfare of 1.5 crore fisherman are
some of the major highlights of the Interim Budget 2019-20.
Major Schemes
New Scheme- namely “Pradhan Mantri KIsan SAmman Nidhi (PM-KISAN)” to extend direct income support at the rate of Rs. 6,000 per year to farmer families, having cultivable land upto 2 hectares is announced.
While
presenting the Interim Budget 2019-20, the Union Minister for Finance,
Corporate Affairs, Railways & Coal, Shri Piyush Goyal said that “our Government is launching a historic programme PM-KISAN with an outlay of Rs.75,000 crore for the FY 2019-20 and Rs.20,000 crore in the Revised Estimates of FY 2018-19”.
Under this Government of India funded Scheme, Rs.2,000 each will be
transferred to the bank accounts of around 12 crore Small and Marginal
farmer families, in three equal installments. This programme would be
made effective from 1st December 2018 and the first installment for the
period upto31st March 2019 would be paid during this year itself, Shri
Piyush Goyal said.
To provide sustained and focused attention towards development of Fisheries, the Government has decided to create a separate Department of Fisheries.
Finance Minister said that through the measure, the Government wants to
promote further growth over 7% to promote livelihood of about 1.45
crore people dependent on the sector.
The
Finance Minister announced 2% interest subvention to the farmers
pursuing the activities of animal husbandry and fisheries, who avail
loan through Kisan Credit Card. Further, in case of timely repayment of
loan, they will also get an additional 3% interest subvention.
Allocation
of Rs.750 crore for Rashtriya Gokul Mission has been announced for the
current year itself. Setting up of "Rashtriya Kamdhenu Aayog" to upscale
sustainable genetic upgradation of cow resources and to enhance
production and productivity of cows has also been announced. The Aayog
will also look after effective implementation of laws and welfare
schemes for cow.
To provide pensionary benefits to at least 10 crore labourers and workers in the unorganised sector a new Scheme called 'Pradhan Mantri Shram-Yogi Maandhan' is announced. The Finance Minister said that within
next five years it would be one of the largest pension schemes of the
world. A sum of Rs.500 crore has been allocated for the Scheme.
Additional funds will be provided as needed, Shri Goyal added. The
scheme will also be implemented from the current year, he said.
Tax Benefits
Individual
taxpayers having taxable annual income up to Rs.5 lakhs will not be
required to pay any income tax. The Finance Minister said that persons
having gross income up to Rs. 6.50 lakhs are not required to pay any
income tax if they make investments in provident funds, specified
savings and insurance etc. Additional deductions such as interest on
home loan up to Rs. 2 lakh, interest on education loans, National
Pension Scheme contributions, medical insurance and medical expenditure
on senior citizens etc, are also provided for in the Interim Budget
2019-20. Thus tax benefit of Rs. 18,500 crore is proposed to be provided
to an estimated 3 crore middle class and small taxpayers comprising
self employed, small business, small traders, salary earners, pensioners
and senior citizens.
For
salaried persons, Standard Deduction is being raised from the current
Rs.40,000 to Rs.50,000. This will provide additional tax benefit of Rs.
4,700 crore to more than 3 crore salary earners and pensioners.
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
if one has more than one self-occupied house.
TDS threshold on interest earned on bank/post office deposits is being raised from Rs.
10,000 to Rs.40,000.
TDS
threshold for deduction of tax on rent is proposed to be increased from
Rs. 1,80,000 to Rs.2,40,000 for providing relief to small taxpayers.
The
Finance Minister says that the Government wants the GST burden on home
buyers to be reduced and accordingly the GST Council was moved to
appoint a Group of Ministers to examine and make recommendations in this
regard at the earliest.
Shri Goyal said that soon, businesses comprising over 90% of GST payers will be allowed to file quarterly return.
Inflation
The Finance Minister said that the Government has been successful in
bringing down average inflation to 4.6% over last five years, which is
lower than the inflation during the tenure of any other Government. In
fact Inflation in December 2018 was down to 2.19% only. Shri Goyal said
if we had not controlled inflation, our families would have been
spending around 35-40% more today on basic necessities such as food,
travel, consumer durables, housing etc. The average rate of inflation
during previous five years 2009-2014 was a backbreaking 10.1%, he
pointed out.
Fiscal Deficit
The fiscal deficit has been brought down to 3.4% in 2018-19 RE from the
high of almost 6% seven years ago, the Finance Minister mentioned. He
said, the Current Account Deficit (CAD), against a high of 5.6% six
years ago, is likely to be only 2.5% of GDP this year. “We contained the
fiscal deficit notwithstanding the Finance Commission's recommendations
increasing the share of the States from 32% to 42% in central taxes,
which we accepted in the true spirit of cooperative federalism, thereby
transferring significantly higher amounts to the States”, Shri Goyal
said.
Growth and FDI
The
Finance Minister Shri Piyush Goyal stated that a stage for high growth
in decades to come, has now been set, after a wave of next generation
path breaking structural reforms over the last five years, including
introduction of Goods and Services Tax (GST) and other taxation reforms.
The
country witnessed its best phase of macro-economic stability during the
last five years. “We are the fastest growing major economy in the world
with an annual average GDP growth during last five years higher than
the growth achieved by any Government since economic reforms began in
1991. From being the 11th largest economy in the world in 2013-14, we
are today the 6th largest in the world”, the Finance Minister asserted in his Opening Remarks of his Budget speech.
Shri
Goyal said that due to such a stable and predictable regulatory regime,
growing economy and strong fundamentals, India could attract massive
amount of as much as $239 billion of Foreign Direct Investment (FDI)
during the last 5 years, when most of the FDI was allowed to come in
through the automatic route.
Enhanced allocations for major Schemes
Announcing an allocation of Rs.60,000 crores for MGNREGA for Budget
Estimates 2019-20, the Finance Minister said that additional
allocations will be made, if required.
Pradhan
Mantri Gram Sadak Yojana (PMGSY) is being allocated Rs.19,000 crore in
BE 2019-20 as against Rs.15,500 crore in RE 2018-19. During the period 2014-18, a total number of 1.53 crore houses have been built under the Pradhan Mantri Awas Yojana, he announced.
By
March, 2019, all households will be provided with electricity
connection. Till now, 143 crore LED bulbs have been provided in a
mission mode which has resulted in saving of Rs.50,000 crore for the
poor and middle class.
He
said through the world’s largest healthcare programme, Ayushman Bharat,
to provide medical treatment to nearly 50 crore people in the country,
around 10 lakh patients have already benefited through free treatment
for medical treatment which would have otherwise cost them Rs. 3,000
crore. Lakhs of poor and middle class people are also benefiting from
reduction in the prices of essential medicines, cardiac stents and knee
implants, and availability of medicines at affordable prices through
Pradhan Mantri Jan Aushadhi Kendras, the Finance Minister added.
Shri
Goyal also said that 14 of the 21 AIIMS operating or being established
in the country presently have been announced since 2014. He also
announced setting up of a new - the 22nd AIIMS in Haryana.
Allocation
for Integrated Child Development Scheme (ICDS) is being increased from
Rs.23,357 crore in RE 2018-19 to Rs.27,584 crore in BE 2019-20.
A
substantial increase is proposed in the allocation for welfare of the
Scheduled Castes and Scheduled Tribes. The allocation of Rs.56,619
crore made in BE of 2018-19 for Scheduled Caste, further increased to
Rs.62,474 crore in RE is proposed to be enhanced to Rs.76,801 crore in
BE for 2019-20, an increase of 35.6% over BE of 2018-19. For the
Scheduled Tribes also, proposed allocation in 2019-20 BE is Rs.50,086
crore as against Rs.39,135 crore in BE 2018-19, an increase of 28%.
The
Finance Minister said that a Welfare Development Board to frame special
strategies for the benefit of the hard-to-reach De-notified, Nomadic
and Semi-Nomadic communities will be set up under the Ministry of Social
Justice and Empowerment. He said that a Committee under NITI Aayog will
also be set up to complete the task of identifying De-notified, Nomadic
and Semi-Nomadic communities not yet formally classified.
Shri
Goyal said under the Ujjwala Yojana aiming delivery of 8 crore free
LPG connections, more than 6 crore connections have already been given
and the remaining will get free gas connections by next year.
The
Finance Minister announced that a National Artificial Intelligence
Portal will also be developed soon as a part of the National Programme
on 'Artificial Intelligence'.
The
Department of Industrial Policy and Promotion will now be renamed as
the Department for Promotion of Industries and Internal Trade.
The
Finance Minister stated that the Government e-Marketplace (GeM),
created by the present Government two years ago, resulted in average
savings of 25-28% and the platform will now be extended to all CPSEs.
Transactions of over Rs. 17,500 crore have taken place so far.
The Finance Minister announced that for the first time, the country’s Defence Budget will be of over Rs.3 lakh crore.
The
Finance Minister, Shri Piyush Goyal pointed-out that domestic air
traffic passengers have doubled during the last five years, leading to
large number of jobs also being created. The number of operational
airports has crossed 100 with the commissioning of the Pakyong airport
in Sikkim. Arunachal Pradesh came on the air map recently and
Meghalaya, Tripura and Mizoram have come on India’s rail map for the
first time.
Capital
support from the budget for Indian Railways is proposed at Rs.64,587
crore in 2019-20 (BE). The Railways’ overall capital expenditure
programme is of Rs. 1,58,658 crore. The Finance Minister, who is also
holding the portfolio of Railway Ministry, announced that the Operating
Ratio is expected to improve from 98.4% in 2017-18 to 96.2% in 2018-19
(RE) and further to 95% in 2019-20 (BE).
India’s
installed solar generation capacity has grown over ten times in last
five years. Stating this, Shri Goyal said that “our commitment to
promote renewable energy is reflected in setting up the International
Solar Alliance, the first treaty based international inter-governmental
organisation headquartered in India. This sector is now creating lakhs
of new age jobs, he added.
The
Finance Minister announced that in Entertainment industry, which is a
major employment generator, regulatory provisions will now rely more on
self-declarations. To promote entertainment industry, the Single window
clearance for ease of shooting films, now available only to foreigners,
will also be made available to Indian filmmakers. “We will also
introduce anti-camcording provisions in the Cinematograph Act to control
the menace of piracy”, he said.
Saying
that “We are poised to become a Five Trillion Dollar Economy in the
next five years and aspire to become a Ten Trillion Dollar Economy in
the next 8 years thereafter”, Shri Piyush Goyal said that there has been
a Growth of 18% in Direct Tax Collections in 2017-18 and increase in
tax base by as many as 1.06 crore people filing income tax returns for
the first time in FY 2017-18, mainly on account of demonetization.
Shri
Goyal said that he is proposing, through the Finance Bill, necessary
amendments to levy Stamp duties on one instrument relating to one
transaction and get collected at one place through the Stock Exchanges.
The duty so collected will be shared with the State Governments
seamlessly on the basis of domicile of buying client, he said.
In
all the total expenditure is to increase from Rs.24,57,235 crore in
2018-19 RE to Rs.27,84,200 crore in 2019-20 BE. A rise of Rs.3,26,965
crore or approximately 13.30%. This reflects a high increase considering
low inflation. The fiscal deficit of year 2019-20 is estimated to be
3.4% of GDP.
The
Finance Minister pointed out that after completion of the fiscal
deficit consolidation programme, the Government would now focus on Debt
consolidation. He said “We have maintained the glide path towards our
target of 3% of fiscal deficit to be achieved by 2020-21. India’s Debt
to GDP ratio was 46.5% in year 2017-18. The FRBM Act prescribes that the
Debt to GDP ratio of the Government of India should be brought down to
40% by 2024-25. “Along with completion of the fiscal deficit
consolidation programme, we will now focus on Debt consolidation”, he
added.
