Recommended
More Related Content
What's hot
What's hot (20)
Similar to Union Budget 2021-22
Similar to Union Budget 2021-22 (20)
More from tanakshi
More from tanakshi (8)
Recently uploaded
Recently uploaded (20)
Union Budget 2021-22
- 1. Tanakshi UNION BUDGET Brief Overview: The Union Budget is the annual financial statement of the estimated receipts and expenditure of the government of the respective year. The fiscal year starts from 1st April and ends on 31st March. The Budget is presented in the Indian Parliament (Lok Sabha), generally by the Finance Minister of India. The formulation of Budget is the task of the Budget Division of the Department of Economic Affairs, this department is the part of the finance ministry. The Union Budget can be divided into two: • Revenue Budget • Capital Budget Key features of the budget/New proposals/Changes that have been made : • Changes in Tax regime. § In the Union Budget of the financial year 2021-22, Finance Minister Nirmala Sitaraman announced that relief to the senior citizen from filing ITR ( Income Tax return) ( senior citizens- 75 years and above). § Tax relief will also be given to the NRI’s ( Non Resident Indian), the relief would be separately announced.Itwasexpectedthat therewouldberelaxationinthe numberofdaysduetocurrent pandemic situation, the relaxation was anticipated to be 120 days to 180 days. § Interest on employee’s share of contribution to Employees' Provident Fund (EPF) on or after April 1, 2021, will be taxable at the stage of withdrawalif it exceeds ₹2.5lakh in any year. This
- 2. will lead to additional tax liability, especially for High Net worth Individuals (HNIs) who make higher contributions and will also discourage voluntary provident fund (VPF) contributions. § The government has extended the additional tax deduction of ₹1.5 lakh on interest paid on housing loan for the purchase of affordable homes by one more year to March 31, 2022. § Time limit for filing delayed ITR reduced: The last date to file a revised income-tax return or belated return on a voluntary basis will now be December 31 after the close of the financial year instead of March 31, 2022. • Allocation to health: § The allocation of budget to the health sector have been increased, due to the Covid-19 crisis. health allocation jumped 137% to Rs. 2,23,846 crore in 2021-22 compared with Rs. 94,452 crore in 2020-21, the amount also includes budget for schemes from other ministries along with ministry of health and family welfare such as POSHAN Abhiyan under Women and Child Development ministry, Jal Jeevan Mission (Urban) under department of Water and Sanitation. § Finance Minister provided Rs 35,000 crore for the Covid- 19 vaccine, and promised to provide further funds, if required. § The budget allocation for the Department of Health and Family Welfare is Rs. 71,269 crores, an increase of 9.6% over the budget allocation (Rs. 65,012 crores) on Financial Year 2020-21. This is, however, lower than the revised estimates for financial year 2020-21 (Rs. 78,866 crores.) • Allocation to agriculture sector: § The Agriculture Ministry did not spend its full budget during 2020- 21, leading to a reduction in the allocation in the revised estimates (RE) for the current financial year and a lower outlay for the next one. In Union Budget 2021-22, the two departments—Department of Agriculture, Cooperation and Farmers’ Welfare and Department of Agricultural Research and Education— under the Agriculture Ministry have been allocated a total amount of Rs 1,31,531.19 crore, lower than the current financial year’s budget estimates (BE) of Rs 1,42,762.35crore,butalittlehigherthanREof Rs1,24,520.3crore. § While the Department of Agricultural Research and Education has seen a marginal increase—Rs 8,513.62 crore in BE 2021-22 from Rs 8,362.58 crore in BE 2020-21, the Department of Agriculture, Cooperation and Farmers’ Welfare has seen a reduction of over Rs 10,000 crore in its budget—from Rs 1,34,399.77 crore in BE 2020-
- 3. 21 to Rs 1,23,017.57 crore in BE 2021-22. However, it is higher than the RE figure of 1,16,757.92 crore for the current financial year. • Real Estate : § Two major incentives given to the real estate sector are tax benefits for affordable housing and for private investment formats such as REITs and InvITs (Real Estate Investment Trusts and Infrastructure Investment Trusts). The FM proposed to extend by another year — till March 31, 2022 — the tax exemption benefit,aswellasdeductionofinterestonloans for affordable housing. § Indirect support measures, such as an injection of funds in infrastructure development, which will boost overall capital appreciation of nearby property.(Capital appreciation is an increase in the price or value of assets. It may refer to appreciation of company stocks or bonds held by an investor, an increase in land valuation, or other upward revaluation of fixed assets.) • Railways: § The Union budget has allocated ₹1.1 trillion for the Indian Railways, out of which ₹1.07 trillion will be utilized for capital expenditure for 2021-22 to expand rail infrastructure in India. § The budget has given specific thrust to special projects such as DFCs and high-speed rail projects (dedicated freight corridor) The Dedicated Freight Corridor Corporation of India LimitedisaPublicSector Undertaking corporationrun by theGovernment of India'sMinistry of Railways to undertake planning, development, and mobilisation of financial resources and construction, maintenance and operation of the "Dedicated Freight Corridors". § Future dedicated freight corridor projects– § East Coast corridor from Kharagpur to Vijayawada § East-West Corridor from Bhusaval to Kharagpur to Dankuni § North-South corridor from Itarsi to Vijayawada § Raising the share of public transport in urban areas by expansion of metro rail network and augmentation of city bus service. Rs. 18,000 crore for a new scheme, to augment public bus transport. Innovative PPP models to run more than Rs. 20,000 buses ( Public Private Partnership- A public–private partnership is a cooperative arrangement between two or more public and private sectors, typically of a long-term nature.)
- 4. • ROLE OF RBI • TheReserveBankofIndia(RBI)has,throughreporatereductions,givenanudgeforthebanks to spend more and save less. The huge capital outlay that the Budget saw will take things forward in this direction as the focus will be on driving public spending and increasing consumption. Banks will have a greater and definitive role to play in here. In fact, we might witness loans getting cheaper or more attractive and innovative financial products being offered by banks as an incentive to make customers spend more. • Finance Minister Nirmala Sitharaman said the government will work with the Reserve Bank of India (RBI) for execution of the bank privatisation planannounced in the Union Budget 2021. The FM, however, did not reveal the name of banks chosen for privatisation. • The FM proposed privatisation of two banks as part of its disinvestment plan. Bank unions have opposed the move. BAD BANK: Union Finance Minister Nirmala Sitharaman has announced the concept of bad bank in the country. In her budget speech, she said that an Asset Reconstruction Company Limited and AssetManagementCompany willbesetupthatwillmanagethebaddebtofpublicsectorbanks like State Bank of India, Punjab National Bank and others. It aims to provide financial stability in the banking sector. This concept is new and was introduced by Union Finance Minister Nirmala Sitharaman in the recent Union budget,2021-22. The existing stock of bad loans is a big worry for public sector banks. As of September 2020, the total gross NPAs of the banking system was 7.5 per cent of the overall industry loan book. According to the ReserveBankof India’s (RBI) projection,this isexpectedto shoot up to 13.5 per cent by March-September this year. According to an estimate, non-performing assets totalling Rs 899,803 crore will be transferred to the bad bank. Official site : https://www.indiabudget.gov.in/ https://www.indiabudget.gov.in/doc/bh1.pdf https://pib.gov.in/AATAMNIRBHARBHARATKABUDGET/ s Sources : https://www.indiatvnews.com/business/news-what-is-bad-bank-budget-2021-how-modi- government-plans-to-address-stressed-assets-of-public-sector-banks-682084