Finance Minister Nirmala Sitaraman presented the Union Budget 2023 today, which broadly included the vision for Amrit Kaal, the saptarishi, i.e. the 7 priorities of the budget and the tax proposals. The present article discusses the key highlights from the Union Budget 2023.
Vision for Amrit Kaal
The vision for Amrit Kaal includes an economy which is technology-driven and knowledge-based, along with strong public finances, a robust financial sector and
The Jan Bhagidari through Sabka Saath Sabka Prayas is considered essential for achieving the same
The economic agenda for achieving this vision is focused on three things: i.e. facilitating ample opportunities for citizens with special emphasis on the nation’s youth for fulfilling their aspirations, growth and job creation; strengthening macro-economic stability.
There are four opportunities that are considered to be transformative during the Amrit Kaal Economic Empowerment of Women, PM Vishwakarma KAushal Samman tourism and green growth
Priorities of the Budget
The budget adopted 7 priorities for the budget, termed Saptarishi’ which is believed to provide guidance through the Amrit Kaal. The priorities are elaborated below –
The first priority of the union budget is Inclusive Development or Sabka Saath Sabka Vikas, which consists of the following.
Agriculture and Cooperatives
This focuses on the below-mentioned areas –
Building a Digital Public Infrastructure which acts as an accessible, inclusive and informative solution for the Indian farmers.
Setting up an Agriculture Accelerator Fund for the encouragement of innovative startups in the rural areas.
Launching ANB Horticulture Clean Plant Program for boosting the production of high-value horticulture crops.
Targeted funding of Rs 20 lakh crore agricultural credit to be targeted at Animal Husbandry, Fisheries and Dairy sector.
Making India a Global Hub for Millets i.e. Sree Anna, for which the support shall be provided to IIMR Hyderabad for the purpose of promoting research.
Setting up a storage capacity which is widely available with the objective of enhancing the remuneration of the farmers by enabling sale at appropriate times.
Food Security: The commitment of food security shall be continued with aa scheme to supply free food grain to all Antyodaya and priority households for a period of one year starting January this year under PM Garib Kalyan Ann Yojana.
Significant progress have been made in the direction of Swachh Bharat, PM Suraksha Bima Yojana, Direct benefit transfer, and Jan Dhan accounts. The focus would still remain on job creation and youth empowerment.
The following steps shall be taken in this regard –
Establishment of 157 new nursing colleges
Launch of Sickle Cell Anaemia elimination mission
Launch of a new programme for promoting research in the pharmaceuticals
Encouragement of joint public and private medical research via ICMR labs
Education and Skilling
The education and skilling shall be done through the following –
Revamping the Teacher’s Training i.e. the District Institute of Education and Training.
Setting up national Digital Libraries for children and adolescents.
Encouraging the states towards setting up physical libraries at
Panchayat and ward levels
Reaching the Last Mile
This is the second priority of the budget and shall include the following –
Launching of Pradhan Mantri PVTG Development Mission
Providing financial assistance to Karnataka for the purpose of micro irrigation in drought-prone regions
Recruiting more teachers for the 740 Eklavya Model Residential Schools
Setting up the Bharat Shared Repository of Inscriptions
Infrastructure and Investment
The third priority of the Union Budget 2023 is the Infrastructure and Investment, and the below-mentioned steps shall be taken in respect of the same –
Increase in the capital investment outlay by 33.4 per cent to 10 lakh cr.
Continue with the 50 yr interest-free loan to state governments for the purpose of incentivizing the infrastructure investments.
Highest ever capital outlay of Rs 2.4 lakh crore for the railways
100 transport infrastructure projects have been identified for end-to-end connectivity for ports, steel, coal, and fertilizer sectors
Create urban infrastructure in tier 2 and 3 cities by establishing Urban Infrastructure Development Fund.
Unleashing the Potential Trust-Based Governance
The Union Budget 2023 also adopted Unleashing the Potential Trust-Based Governance as one of its priorities and attempted to take the following measures in this regard –
Make AI in India and set up three specialized AI centres in educational institutions to enable AI-based solutions in health agriculture and sustainable cities.
Introduce the National Data Governance Policy to enable access to anonymized data for research by academia and start-ups.
Vivad Se Vishwas 1
with less stringent contract execution by MSME to provide relief to the MSME affected during the covid time
Vivad Se Vishwas 2 which focuses on an easier and standardized settlement scheme for the purpose
of faster resolution of contractual disputes of the government and government undertakings
Launch Phase 3 of E Courts to ensure effective management of justice
Setting up the Entity Digi Locker for the use of charitable trusts and business enterprises in order to facilitate storing and sharing of documents securely with the business documents
Setting up 100 labs for 5G services-based application development for tapping the employment and business opportunities
R&D Grant for Lab Grown Diamonds LDG sector with the objective of encouraging domestic production and reducing the dependency on exports
The fifth priority of the Union Budget 2023 is
Green Growth focuses on the following
Green Credit Programme, which shall be notified under FPA for incentivising sustainable actions
Launching PM – PRANAM for incentivizing the states and UTs in order to promote the use of alternative fertilizers
Taking up MISHTI for mangrove plantation along the coastline
Implementing Amrit Dhanbar for optimal use of wetlands
Establishing 500 new Waste to Wealth Plants under the GOBARdhan scheme for promoting a circular economy
Setting up 10,000 bio input resource centres for facilitating farmers towards the adoption of natural farming
Promoting Battery Energy storage systems
Allocation of funds for the replacement of old polluting vehicles
Youth power, or Amrit Peedi is the 6th priority of the Union Budget 2023, which focuses on the following.
Launching PMKVY4.0 for the purpose of covering new courses like robotics, coding, AI, #D painting etc
Taking measures for the promotion of the tourism sector in the country by selecting at least 50 destinations via the challenge mode, which shall be developed as a complete package for the domestic and foreign tourists
Encouraging the setup of unity malls for promoting One district One product handicraft and GI products
This is the final priority of the Saptarishi of the Union Budget 2023, which deals with the below-mentioned aspects.
Setting up National Financial Information Registry for enabling efficient lending, promoting financial inclusion and enhance financial stability
Establishing Central data Processing Centre for handling the administrative work under the Companies Act faster
Expansion of the credit guarantee scheme for the MSME under a revamped scheme for enabling additional collateral-free guaranteed credit of 2 lakh crore
A one-time new small saving scheme by the name of Mahina Samman Bachat Patra with a 2 yr period and a deposit facility of upto 2lakh for women.
Certain benefits for senior citizens through enhanced maximum deposit limit for senior citizens saving scheme from 15 to 30 lakh.
Creating more trained professionals in the securities market through awarding educational certificates.
Apart from the financial sector, fiscal management is also considered essential, and the following shall be done in respect of the same –
50yr Interest Loans to States will be spent on Capital Expenditure within 2023-24, and a part of this loan is conditional on states increasing capital expenditure, and parts of outlay shall be linked to states undertaking various reforms.
A fiscal deficit of 3.5%of GSDP is allowed for states with 0.5% tied to Powers sector reforms.
Target fiscal deficit to be below 4.5% by 2025-26.
New tax regime is the default tax regime. However, citizens can opt for the old tax regime. The tax slabs as per the new regime are provided below.
Income tax slabs under new tax regime
Income tax rates under new tax regime
O to Rs 3 lakh
Rs 3 lakh to Rs 6 lakh
Rs 6 lakh to Rs 9 lakh
Rs 9 lakh to Rs 12 lakh
Rs 12 lakh to Rs 15 lakh
Income above Rs 15 lakh
An individual having an annual income of Rs 9 lakh shall now be paying only Rs 45,000 in taxes:
Income of Rs 15 lakh will fetch Rs 1.5 lakh tax, down from Rs 1.87 lakh
Extending benefits of the standard tax deduction for salaried and pensioned
Payment received from Agniveer Corpus Fund by Agniveers shall be exempted
Tax exemption removed in insurance policies with premiums over Rs 5 lakh
Goverment proposes to provide for TDS and taxability on the new regime.
Tax exemption on leave encashment on the retirement of non-government salaried employees hiked to Rs 25 lakh which was 3 lakh earlier.
A higher limit of for TDS on cash withdrawal ie Rs 3 crore
is to be provided to cooperative societies.
Next-generation Common ITR Form to be rolled out for taxpayer convenience
Grievance redressal mechanism to be strengthened
TDS rate to be reduced from 30 % to 20 % on the taxable portion of EPF withdrawal in non-PAN cases.
The rebate limit has been increased from 5lakh to 7 lakh
The highest surcharge rate on income above 5 crs. is reduced from 37% to 25%
The benefit of carry forward losses upon change of shareholding of start-ups from 7 to 10 years of incorporation
Extension of period for tax benefits to funds that relocating to IFSC Gift City till 31st March 2025
Extending the incorporation date by 1 year for income tax start-ups
Deduction on payment made to MSME is only accepted when the payment is actually made
Decriminalization under section 276A of the Income Tax Act.
Allowing carry forward of losses on strategic disinvestment including that of IDBI Bank,
A 16% increase in the duty on cigarettes have been proposed.
The budget also discusses the funds allocated to various ministries and the amendment of various regulations. The union budget 2023 can provide much-needed relief to the middle-class taxpayer and encouragement to the startups. The 7 priorities adopted by the government can foster the nation’s growth.
Shubhangi has completed her B. A.LLB (H) with specialization in Business Laws from Amity University. She is particularly interested in legal research and writing and wishes to utilize her knowledge to create informative legal content. She has prior experience in corporate and criminal litigation and has great drafting skills. She has also published various research papers in reputed journals.