Budget 2023: Capital investment outlay will be raised by 33% to ₹ 10 lakh crore — 3.3 per cent of the GDP
Nirmala Sitharaman, the finance minister, released the government’s final budget before the 2024 general election today in New Delhi. She announced significant tax relief for taxpayers as well as a massive push for infrastructure expenditure.
Here is a 10-point guide to Budget 2023.
1. In the new tax system, which will serve as the default, the administration has streamlined the slabs. The highest applicable tax rate in India after surcharges has decreased from 42.7% to 39.0%, and there would be no tax on income up to Rs. 7 lakh per year, up from Rs. The new fiscal system is “appealing since it offers a bigger rebate. Additionally, it offers simplified and smaller slabs, “added the minister.
2. The new regime will reduce the number of tax brackets from seven to just five. Up to Rs. 3 lakh of income would not be subject to tax.Income between 3 and 6 lakh will be taxed at 5; income between 6 and 9 lakh will be taxed at 10; income between 9 and 12 lakh will be taxed at 15; income between 12 and 15 lakh will be taxed at 20; and income beyond 15 lakh will be taxed at 30.
3. The government would expand its strategy to resuscitate growth after Covid by spending a record-breaking 10 lakh crore, an increase of 33%, on longer term capital investment. In 2023–2024, this will be 3.3% of the GDP.
4. The government has identified seven priority sectors, including unleashing potential, green growth, youth power, infrastructure and investment, and the financial sector.
5. The goal for agricultural loan has been raised to 20 lakh crore, and in yet another populist move, funding for the PM Awas Yojna has boosted by 66% to more than 79,000 crore. 50 new airports and helipads have also been promised by the administration.
6. The minister announced a 2.4 lakh crore outlay for the railroads, which is four times the budget from the previous year and the most in almost a decade. When comparing it to the final year of the UPA administration under the leadership of the Congress, she added, “This is approximately nine times the outlay made in 2013-14.”
7. All digital systems of the designated government entities will use an uniform identity called the Permanent Account Number (PAN). Through the Digilocker service and Aadhaar, the KYC process would be streamlined and a one-stop identity update will be established. To make corporate operations easier, a “Unified Filing Procedure” system would be established to reduce the present duplication process for several departments.
8. The administration will introduce a new method for resolving conflicts in the commercial sphere. According to the minister, there would be a single point of contact for the reconciliation of IDs kept by various government agencies.
9. The government plans to produce 5 MT of green hydrogen by 2030 with a goal of transitioning to green fuel, according to Ms. Sitharaman.
10. The updated forecast for the current fiscal will maintain the fiscal deficit objective of 6.4%. According to Ms. Sitharaman, it will be reduced to 5.9% of the GDP for the upcoming fiscal year 2023–2024.