Union Budget 2023-24 : Highlights

Union Budget 2023-24: Highlights

The Union Minister of Finance and Corporate Affairs Smt. Nirmala Sitharaman presented the Union Budget 2023-24 in Parliament. 

Budget Estimates 2023-24:

• The total receipts other than borrowings are estimated at Rs 27.2 lakh crore and the total expenditure is estimated at Rs 45 lakh crore.
• The net tax receipts are estimated at Rs 23.3 lakh crore.
• The fiscal deficit is estimated to be 5.9 percent of GDP.
• To finance the fiscal deficit in 2023-24, the net market borrowings from dated securities are estimated at Rs 11.8 lakh crore.
• The gross market borrowings are estimated at Rs 15.4 lakh crore.
• Per capita income has more than doubled to ₹1.97 lahks in around nine years.
• Revised Estimates 2022-23:
  • The total receipts other than borrowings is Rs 24.3 lakh crore, of which the net tax receipts are Rs 20.9 lakh crore.
  • The total expenditure is Rs 41.9 lakh crore, of which the capital expenditure is about Rs 7.3 lakh crore.
  • The fiscal deficit is 6.4 percent of GDP, adhering to the Budget Estimate.

Union Budget 2023 Highlights:

• The Indian economy has increased in size from being 10th to 5th largest in the world in the past nine years.
• EPFO membership has more than doubled to 27 crore.
• Insurance cover for 44.6 crore persons under PM Suraksha Bima and PM Jeevan Jyoti Yojana.
• Cash transfer of ₹2.2 lakh crore to over 11.4 crore farmers under PM Kisan Samman Nidhi.
• The seven priorities of the budget ‘Saptarishi’ are inclusive development, reaching the last mile, infrastructure and investment, unleashing the potential, green growth, youth power, and financial sector.
• Atmanirbhar Clean Plant Program with an outlay of ₹2200 crore to be launched to boost the availability of disease-free, quality planting material for high-value horticultural crops.
• 157 new nursing colleges are to be established in co-location with the existing 157 medical colleges established since 2014.
• Centre to recruit 38,800 teachers and support staff for the 740 Eklavya Model Residential Schools, serving 3.5 lakh tribal students over the next three years.
• The outlay for PM Awas Yojana is being enhanced by 66% to over Rs. 79,000 crores.
• Capital outlay of Rs. 2.40 lakh crore has been provided for the Railways, which is the highest ever outlay and about nine times the outlay made in 2013-14.
• Urban Infrastructure Development Fund (UIDF) will be established through use of priority Sector Lending shortfall, which will be managed by the national Housing Bank, and will be used by public agencies to create urban infrastructure in Tier 2 and Tier 3 cities.
• 100 labs to be setup for 5G services based application development to realize a new range of opportunities, business models, and employment potential.
• 500 new ‘waste to wealth’ plants under GOBARdhan (Galvanizing Organic Bio-Agro Resources Dhan) scheme to be established for promoting circular economy at total investment of Rs 10,000 crore. 5 per cent compressed biogas mandate to be introduced for all organizations marketing natural and bio gas.
• Centre to facilitate one crore farmers to adopt natural farming over the next three years. For this, 10,000 Bio-Input Resource Centres to be set-up, creating a national-level distributed micro-fertilizer and pesticide manufacturing network.
• Pradhan Mantri Kaushal Vikas Yojana 4.0, to be launched to skill lakhs of youth within the next three years covering new age courses for Industry 4.0 like coding, AI, robotics, mechatronics, IOT, 3D printing, drones, and soft skills.
• 30 Skill India International Centres to be set up across different States to skill the youth for international opportunities.
• Revamped credit guarantee scheme for MSMEs to take effect from 1st April 2023 through the infusion of Rs 9,000 crore in the corpus.
• This scheme would enable additional collateral-free guaranteed credit of Rs 2 lakh crore and also reduce the cost of the credit by about 1 percent.
• Central Processing Centre to be setup for faster response to companies through centralized handling of various forms filed with field offices under the Companies Act.
• The maximum deposit limit for Senior Citizen Savings Scheme is to be enhanced from Rs 15 lakh to Rs 30 lakh.
• Targeted Fiscal Deficit to be below 4.5% by 2025-26.
• Agriculture Accelerator Fund to be set-up to encourage agri-startups by young entrepreneurs in rural areas.
• To make India a global hub for ‘Shree Anna’, the Indian Institute of Millet Research, Hyderabad will be supported as the Centre of Excellence for sharing best practices, research and technologies at the international level.
• ₹20 lakh crore agricultural credit targeted at animal husbandry, dairy, and fisheries
• A new sub-scheme of PM Matsya Sampada Yojana with targeted investment of ₹6,000 crore to be launched to further enable activities of fishermen, fish vendors, and micro & small enterprises, improve value chain efficiencies, and expand the market.
• Sickle Cell Anaemia elimination mission to be launched.
• New Programme to promote research in Pharmaceuticals to be launched.
• Rs. 10 lakh crore capital investment, a steep increase of 33% for third year in a row, to enhance growth potential and job creation, crowd-in private investments, and provide a cushion against global headwinds.
• Aspirational Blocks Programme covering 500 blocks launched for saturation of essential government services across multiple domains such as health, nutrition, education, agriculture, water resources, financial inclusion, skill development, and basic infrastructure.
• Rs. 15,000 crore for implementation of Pradhan Mantri PVTG Development Mission over the next three years under the Development Action Plan for the Scheduled Tribes.
• Investment of Rs. 75,000 crore, including Rs. 15,000 crore from private sources, for one hundred critical transport infrastructure projects, for last and first mile connectivity for ports, coal, steel, fertilizer, and food grains sectors.
• New Infrastructure Finance Secretariat established to enhance opportunities for private investment in infrastructure.
• District Institutes of Education and Training to be developed as vibrant institutes of excellence for Teachers’ Training.
• A National Digital Library for Children and Adolescents to be set-up for facilitating availability of quality books across geographies, languages, genres and levels, and device agnostic accessibility.
• Rs. 5,300 crore to be given as central assistance to Upper Bhadra Project to provide sustainable micro irrigation and filling up of surface tanks for drinking water.
• Bharat Shared Repository of Inscriptions’ to be set up in a digital epigraphy museum, with digitization of one lakh ancient inscriptions in the first stage.
• Effective Capital Expenditure’ of Centre to be Rs. 13.7 lakh crore.
• iGOT Karmayogi, an integrated online training platform, launched to provide continuous learning opportunities for lakhs of government employees to upgrade their skills and facilitate people-centric approach.
• More than 39,000 compliances reduced and more than 3,400 legal provisions decriminalized to enhance Ease Of Doing Business.
• Jan Vishwas Bill to amend 42 Central Acts have been introduced to further trust-based governance.
• Three centres of excellence for Artificial Intelligence to be set-up in top educational institutions to realise the vision of “Make AI in India and Make AI work for India”.
• ₹35000 crore outlay for energy security, energy transition and net zero objectives.
• Battery energy storage systems to be promoted to steer the economy on the sustainable development path.
• 20,700 crore outlay provided for renewable energy grid integration and evacuation from Ladakh.
• “PM Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth” (PM-PRANAM) to be launched to incentivize States and Union Territories to promote alternative fertilizers and balanced use of chemical fertilizers.
• ‘Mangrove Initiative for Shoreline Habitats & Tangible Incomes’, MISHTI, to be taken up for mangrove plantation along the coastline and on salt pan lands, through convergence between MGNREGS, CAMPA Fund and other sources
• Green Credit Programme to be notified under the Environment (Protection) Act to incentivize and mobilize additional resources for environmentally sustainable and responsive actions.
• Amrit Dharohar scheme to be implemented over the next three years to encourage optimal use of wetlands, enhance bio-diversity, carbon stock, eco-tourism opportunities and income generation for local communities.
• A unified Skill India Digital platform to be launched for enabling demand-based formal skilling, linking with employers including MSMEs, and facilitating access to entrepreneurship schemes.
• Direct Benefit Transfer under a pan-India National Apprenticeship Promotion Scheme to be rolled out to provide stipend support to 47 lakh youth in three years.
• At least 50 tourist destinations to be selected through challenge mode; to be developed as a complete package for domestic and foreign tourists.
• Sector-specific skilling and entrepreneurship development to be dovetailed to achieve the objectives of the ‘Dekho Apna Desh’ initiative.
• Tourism infrastructure and amenities to be facilitated in border villages through the Vibrant Villages Programme.
• States to be encouraged to set up a Unity Mall for promotion and sale of their own and also all others states’ ODOPs (One District, One Product), GI products and handicrafts.
• National Financial Information Registry to be set up to serve as the central repository of financial and ancillary information for facilitating efficient flow of credit, promoting financial inclusion, and fostering financial stability. A new legislative framework to be designed in consultation with RBI to govern this credit public infrastructure.
• To commemorate Azadi Ka Amrit Mahotsav, a one-time new small savings scheme, Mahila Samman Savings Certificate to be launched. It will offer deposit facility upto Rs 2 lakh in the name of women or girls for tenure of 2 years (up to March 2025) at fixed interest rate of 7.5 per cent with partial withdrawal option.
• The maximum deposit limit for Monthly Income Account Scheme to be enhanced from Rs 4.5 lakh to Rs 9 lakh for single account and from Rs 9 lakh to Rs 15 lakh for joint account.
• The entire fifty-year interest free loan to states to be spent on capital expenditure within 2023-24. Part of the loan is conditional on States increasing actual Capital expenditure and parts of outlay will be linked to States undertaking specific loans.
• Fiscal Deficit of 3.5% of GSDP allowed for States of which 0.5% is tied to Power sector reforms.
• Enhanced limits for micro-enterprises and certain professionals for availing the benefit of presumptive taxation proposed. Increased limit to apply only in case the amount or aggregate of the amounts received during the year, in cash, does not exceed five per cent of the total gross receipts/turnover.
• Deduction for expenditure incurred on payments made to MSMEs to be allowed only when payment is actually made in order to support MSMEs in timely receipt of payments.
• Provision of a higher limit of Rs. 2 lakh per member for cash deposits to and loans in cash by Primary Agricultural Co-operative Societies (PACS) and Primary Co-operative Agriculture and Rural Development Banks (PCARDBs).

Union Budget 2023: Taxes

• To improve taxpayer services, a proposal to roll out a next-generation Common IT Return Form for taxpayer convenience, along with plans to strengthen the grievance redressal mechanism.
• Rebate limit of Personal Income Tax to be increased to Rs. 7 lakh from the current Rs. 5 lakh in the new tax regime. Thus, persons in the new tax regime, with income up to Rs. 7 lahks to not pay any tax.
• Tax structure in the new personal income tax regime, introduced in 2020 with six income slabs, to change by reducing the number of slabs to five and increasing the tax exemption limit to Rs. 3 lakh. Change to provide major relief to all tax payers in the new regime.
• Proposal to extend the benefit of standard deduction of Rs. 50,000 to salaried individual, and deduction from family pension up to Rs. 15,000, in the new tax regime.
• Highest surcharge rate to reduce from 37 per cent to 25 per cent in the new tax regime. This to further result in reduction of the maximum personal income tax rate to 39 per cent.
• The limit for tax exemption on leave encashment on retirement of non-government salaried employees to increase to Rs. 25 lakh.
• The new income tax regime to be made the default tax regime. However, citizens will continue to have the option to avail the benefit of the old tax regime.
• Income from Market Linked Debentures to be taxed.
• Income of authorities, boards and commissions set up by statutes of the Union or State for the purpose of housing, development of cities, towns and villages, and regulating, or regulating and developing an activity or matter, proposed to be exempted from income tax.
• Conversion of gold into electronic gold receipt and vice versa not to be treated as capital gain.
• Agniveer Fund to be provided EEE status (Exempt Exempt Exempt category that is tax exemptions on investment, interest/return, and maturity.).
• Period of tax benefits to funds relocating to IFSC, GIFT City extended till 31.03.2025.
• Certain acts of omission of liquidators under section 276A of the Income Tax Act to be decriminalized with effect from 1st April, 2023.
• Number of basic customs duty rates on goods, other than textiles and agriculture, reduced to 13 from 21.
• Minor changes in the basic custom duties, cesses and surcharges on some items including toys, bicycles, automobiles and naphtha.
• Excise duty exempted on GST-paid compressed bio gas contained in blended compressed natural gas.
• Customs Duty on specified capital goods/machinery for manufacture of lithium-ion cell for use in battery of electrically operated vehicle (EVs) extended to 31.03.2024
• Denatured ethyl alcohol used in chemical industry exempted from basic customs duty.
• Duty reduced on key inputs for domestic manufacture of shrimp feed.
• CGST Act to be amended
  • to raise the minimum threshold of tax amount for launching prosecution under GST from one crore to two crore;
  • to reduce the compounding amount from the present range of 50 to 150 per cent of tax amount to the range of 25 to 100 per cent;
  • decriminalise certain offences;
  • to restrict filing of returns/statements to a maximum period of three years from the due date of filing of the relevant return/statement; and
  • to enable unregistered suppliers and composition taxpayers to make intra-state supply of goods through E-Commerce Operators (ECOs).