New Delhi: Union Finance Minister Nirmala Sitharaman presented the Union Budget for 2022-23 on Tuesday, asserting that it aims to provide a boost to growth in the economy which is still recovering from a COVID-induced slump. “The Union Budget seeks to complement macro-economic level growth with a focus on micro-economic level all inclusive welfare,” said Sitharaman while presenting the Budget. While the minister did not announce any major populist giveaways, it announced a number of measures for several sectors to boost growth amid rising inflation and continuing uncertainties posed by the pandemic.
Here are 20 key highlights from Budget 2022-23:
1. India hiked capital expenditure for FY23 at Rs 7.5 lakh crore, about 2.9 percent of GDP. This boost is 35.4 percent higher than the budget estimate of Rs 5.54 lakh crore in FY22.
2. The fiscal deficit target has been set at 6.4 percent for FY23. Higher tax collections so far in the current fiscal have ensured that the government meets the target comfortably.
3. National Highways Network will be expanded by 25,000 km in FY23. Nirmala Sitharaman said Rs 20,000 crore will be mobilised through innovative ways of financing to complement the public resources.
4. Contracts to be awarded through PPP mode in 2022-23 for implementation of Multimodal Logistics Parks at four locations.
5. The Emergency Credit Line Guarantee Scheme (ECLGS) for small firms has been extended to March 2023 and expanded by an additional Rs 50,000 crore. The total cover is now of Rs 5 lakh crore.
6. Startups will enjoy extended tax benefits. So far startups created between April 1, 2016, till March 31, 2021, were eligible for this benefit. This has now been extended to March 31, 2023. This essentially means such startups will be able to avail a 100 percent tax rebate on the profit made in three years in a total time frame of 10 years of operations given their overall annual turnover is not more than Rs 25 crore in a fiscal.
7. Any income from transfer of virtual digital assets such as cryptocurrencies, non-fungible tokens or NFTs will be taxed at 30 percent. Also, loss from sale of virtual digital asset can be set off only against the gains from sale of virtual digital assets. Cryptocurrencies as a gift will be taxed at the receiver’s end.
8. A new legislation will replace the SEZ Act that will cover all large existing and new industrial enclaves to enhance competitiveness of exports.
9. India will issue its own Central Bank Digital Currency in the form of a digital rupee using blockchain to be issued by RBI in 2022-23, as investments in cryptos turn hot in the country.
10. India will issue sovereign green bonds for funding green infrastructure. Green bonds are debt instruments that differ from conventional fixed-income securities only in that the issuer pledges to use the proceeds to finance projects that are meant to have positive environmental or climate effects.
11. India will also launch e-passports in 2022-23, Sitharaman said. These will have biometric data. Passports with biometrics are used in Germany, UK and Bangladesh. An e-passport comes fitted with a small electronic chip containing the data.
12. To bridge the learning gap due to Covid pandemic which has let to a two-year school closure, the government is turning to digital and on-air mode. The government will supplement the learning in schools by extending PM e-Vidya initiative in regional languages.
13. India will allow its citizens to file updated Income Tax Returns or ITR within two years in case of any omission or mistake.
14. 25 percent of the annual research and development budget of the defence ministry will be reserved for private companies and start-ups, a move that will help break the monopoly of PSUs on developing cutting edge military technology.
15. Renewable energy and energy storage technologies received a push in the Budget 2022-23 that proposed additional allocation of Rs 19,500 crore for indigenous solar equipment manufacturing programme and policy support for battery storage.
16. India is considering bringing out a policy on battery swapping for electric vehicles which will lay down interoperability standards to boost EV ecosystem.
17. Lower tax on new manufacturing units will be extended. 15 percent lower tax rate for manufacturing units extended for one more year till March 2024.
18. 100 percent of India’s 1.5 lakh post offices will be on-boarded on core banking system in 2022.
19. Introduction of Digital Rupee by the Reserve Bank of India starting 2022-23.
20. Four pilot projects to be set up for coal gasification and conversion of coal into chemicals for the industry.
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