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FM Sitharaman Goes For Digital Push In Budget, No Change In Tax Slabs, Skips Populism
NEW DELHI: Finance Minister Nirmala Sitharaman on Tuesday sought to create 60 lakh jobs, intended to issue digital rupee using blockchain technology, rolling-out of 5G services, announced 400 new Vande Bharat trains, while also making a big push for digital education and universal access to health facilities in the Union Budget for 2022.
Though there is no change in the income tax slabs for the individuals, taxpayers can now file an updated return within 2 years from the relevant assessment year to correct an error. Also, now both Centre and States govt employees’ tax deduction limit is increased from 10% to 14% to help the social security benefits of state government employees and bring them at par with the Central govt employees.
The FM began her speech by proclaiming that the GDP growth is expected to be at around 9.27% in the current financial year. She also stated that the government is focused on citizen-centric reforms and this budget aims to reform the economy over the next 25 years.
To boost self-reliance and reduce reliance on imports of defence equipment, 68% of capital procurement budget for defence has been earmarked for domestic industry. The Defence Research and Development was opened up for industry and startups.
FM Sitharaman said there has been a tremendous spike in the collection of the Goods and Services Tax (GST), but there are still a few challenges which remain. “The gross GST collections for the month of January 2022 are Rs 1,40,986 crore —the highest since the inception of the tax; this has been possible due to rapid economic recovery,” she said.
Expounding on the jobs, she said the next target of the government is to create 60 lakh jobs in 5 years. The productivity linked incentive in 14 sectors for achieving the vision of ‘AtmaNirbhar Bharat’ has received excellent response, with potential to create 60 lakh new jobs, and additional production of 30 lakh crore during the next 5 years.
The FM announced that digital rupee is to be issued using blockchain and other technologies and will be issued by the Reserve Bank of India (RBI) starting 2022-23. “This will give a big boost to the economy,” she added.
Giving more clarity on taxation of cryptocurrencies and other virtual assets, FM Sitharaman proposed a 30% tax on income from transactions in such assets. She also proposed a 1% TDS (tax deducted at source) on transactions in such asset classes above a certain threshold. Gifts in crypto and digital assets will also be taxed, she said.
Another major announcement made by the FM in her speech is pertaining to the 5G roll out. “The spectrum auction will be conducted to roll out 5G mobile services within the financial year 2022-23 by private firms. The voluntary exit for corporates will be cut down to 6 months from 2 years,” she added.
FM Sitharaman stated that to ensure better access to quality healthcare services, a ‘National Tele Mental Health Programme’ will be launched. Apart from this, an open platform for the National Digital Health Ecosystem will be rolled out, which will consist of digital registries of health providers, health facilities, unique health identity and universal access to health facilities.
Talking about the PM Awas Yojana, she said 80 lakh houses will be completed with an outlay of Rs 48,000 crore. Additionally, Rs 60,000 crore are allocated for ‘Har Ghar, Nal Se Jal’ scheme under which 3.8 crore households will be covered.
On Railways, Ms Sitharaman said 400 new generation Vande Bharat trains will be manufactured in the next three years.
“The government will borrow about Rs 11.6 lakh crore from the market in 2022-23 to meet its expenditure requirement. This is nearly Rs 2 lakh crore higher than the current year’s budget estimate of Rs 9.7 lakh crore,” she concluded.