Budget 2019: Piyush Goyal woos middle class with tax cuts, farmers with sops and more
New Delhi, Feb 1: Finance Minister Piyush Goyal on 1 February presented Narendra Modi government's sixth and final Budget, which was an interim one, keeping up with established tradition. This was the last Budget of the BJP-led NDA government ahead of the General Election.
The Budget will seek Parliament's nod for spending for four months till a new government is sworn-in.
Goyal announced big cheer for the salaried and middle-class taxpayers. In a huge boost, taxpayers with income up to Rs 5 lakh will get full rebate, standard deduction was raised by Rs 10,000, capital gains benefit for those selling a house property and reinvesting the proceeds, huge jump of Rs 30,000 in the threshold for TDS on bank interest and income from post office investments.
Even the TDS threshold on rental income was hiked substantially from Rs 1.8 lakh to Rs 2.4 lakh, thereby giving relief to landlords.
A big income support scheme for farmers by the name of Pradhan Mantri Kisan Samman Nidhi, a pension scheme for unorganised workers called Pradhan Mantri Shram Yogi Mandhan, financial support for cos and fisheries are the key highlights of the big budget push towards rural and poor.
In his speech in Lok Sabha, finance minister Piyush Goyal announced annual support of Rs 6000 per year for farmers holding land below 2 hectares. The gratuity limit has been pegged at Rs 30 lakh. There is a 2% interest subvention for farmers engaged in fisheries and animal husbandry. On the jobs front, the finance minister said that a fast-growing economy is creating jobs based on EPFO data and that sectors like solar have created lakhs of jobs.
Here are the highlights:
Here's what to expect from 2019-20 Interim Budget:
- Farm relief package itself could run to at least Rs. 1 lakh crore ($14.04 billion)
- Set to earmark about Rs. 1.8 lakh crore for food subsidies in the fiscal year
- Expected to waive premium for taking insurance policy for food crops
- Proposal for waiving interest on crop loans for farmers who pay on time
- Target of about $11 billion from state asset sales in FY 2019-20
- Potential stake sales via IPOs include Telecommunications Consultants India, Indian Railways' subsidiaries IRCTC, RailTel Corp India and National Seeds Corp
- Gold - Speculation around a duty cut
- Budget allocation for health is likely to increase by 5 per cent from a year ago
- An anticipated corporate tax rate cut to 25 per cent from 30 per cent may be put on hold until after the elections
- Higher tax exemptions for the middle class and for small businesses anticipated
- Discount of 2 percentage points on loans for businesses with annual sales of less than Rs. 5 crore; government to compensate banks for the costs
- Rs. 4,000 crore-rupee capital infusion for public-sector general insurers
- Reduction of goods and services tax (GST) on electric vehicles and batteries
- Better digital infrastructure in rural areas
- Abolition of the angel tax to boost start-ups
- Exemption from GST for spectrum and licence fee payouts, reduction in spectrum fees and cuts in import duty on telecom equipment (currently at 20 per cent)