GLIMPSES OF UNION BUDGET 2021

union budget 2021

The budget 2021-22 was presented by Finance Minister of India, Mrs Nirmala Sitharaman, in the parliament on 1 Feb 2021. This is the first digital budget in the history of India. 

The highlights of the budget are divided into General followed by direct & indirect taxes. 

General:

  1. Seven mega textile investment parks will be launched in 3 years.
  2. Vehicles scraping policy, fitness test after 20 years in case of personal vehicles (15 in case of commercial vehicles). 
  3. 64,180 cr is expected to be allocated for new health schemes.
  4. 35,000 cr allocated for the covid vaccine. 
  5. 5,54,000 cr allocated for capital expenditure.
  6. 1,18,000 cr proposed for ministry roads. 
  7. 1,10,000 cr allocated to railways. 
  8. Proposal to amend the Insurance Act.
  9. Proposal to increase foreign direct investment (FDI) from 49% to 75%.
  10. Deposit insurance cover (DICGC Act 1961 to be amended). Easy and time-bound access of deposits to help depositors of stress banks. 
  11. Proposal to review the definition of Small companies under the Companies Act 2013 for capital less than 2cr and turnover less than 20 cr.
  12. IPO of LIC announced disinvestment of companies in the financial year 2021-22

Direct & Indirect Taxes:

  1. Pre-filing of returns (salary, tax payment, TDS). Details of capital gains from listed securities, dividend income etc will be prefilled.  
  2. Relaxation to NRIs- Proposed to notify rules for removing hardship for double taxation.
  3. Senior citizens- reduced compliance burden for 75 years and above. Proposal not to file ITR if only pension income and interest income. 
  4. Reduction in time for IT proceedings – Reopening of assessment period reduced from 6 to 3years except in case of senior case evasion. 
  5. Proposal to constitute ‘Dispute resolution committee – taxable income 50,00,000 and disputable income 10,00,000
  6. National Faceless Income Tax appellate Tribunal Centre.
  7. Tax Audit limit – proposal of tax audit increased from 5 cr to 10cr (Only for 95% digitized payments)
  8. Proposal to provide relief on advanced tax liability on dividend income.
  9. Proposal to include Tax holidays for aircraft leasing companies. 
  10. Late deposit of employees’ contribution by the employer will not be allowed as a deduction.
  11. An incentive to startups- tax holiday for one more year.
  12. Duties reduced on various textiles and other products.
  13. Agriculture- custom duty increase on silk, cotton and alcohol etc. 
  14. Gold and Silver- import duty reduced from 12.5% to 7.5% ahead of wedding season. 
  15. Budget allocation for education reduced by 6.5%.

Compiled by:

Dr Sunita Panicker, Principal, MVM College of Arts, Science and Management

Mr. Jeevan Joswin Pais, Faculty Member

Open chat