Budget 2019 India: Nirmala Sitharaman focused on improving infrastructure and helping farmers
Finance Minister Nirmala Sitharaman presented the Union Budget 2019 in parliament today. "We have set the ball rolling for a new India," she said as she opened her speech. This was the first full Budget of the National Democratic Alliance (NDA) in its second term, after coming to power with a massive win in the national election held in April and May. "It took India 55 years to reach a $1 trillion economy. When hearts are with hopes and aspirations, we added $1 trillion in just five years. The common man was served even when transformational reforms were laid out. We have to invest heavily in infrastructure. Citizens felt the difference in every nook and corner. Our focus has been mazboot desh ke liye mazboot nagrik (strong citizens for a strong nation)," Ms Sitharaman said. In the Economic Survey 2018-19 - whose main author was Chief Economic Adviser K Subramanian - presented in parliament by Ms Sitharaman on Thursday, PM Modi has set a challenging target of turning India into a $5 trillion economy in the next five years from $2.7 trillion, which will require an annual growth rate of over 10 per cent.
Here are the highlights of Union Budget 2019, presented by Finance Minister Nirmala Sitharaman:
Budget 2019: A 10-year vision
After the Budget was presented by Finance Minister Nirmala Sitharaman, leaders of the National Democratic Alliance government praised her for bringing out a Budget that they claimed took care of all sections.
The NITI Aayog also appreciated the Budget. "I think, it's a very path breaking and comprehensive budget. We are particularly delighted because the finance minister has acknowledged the role of NITI Aayog," said Amitabh Kant, CEO of the government think tank NITI Aayog.
The centre says this year's Union Budget was made keeping in mind a 10-year vision for India.
Budget 2019: "Budget Will Fulfill Expectations Of 21st Century India", Says PM Modi
Prime Minister Narendra Modi said the union budget presented today by Union Minister Nirmala Sitharaman is "one of hope" and "it is a budget that will boost India's development
in the 21st Century". "This budget is one that will make the nation prosperous and empower the people, it will give strength to the poor and a better tomorrow to the young people," the Prime Minister said soon after the presentation of the budget in the Lok Sabha. The budget - the first of the Modi 2.0 government - is also seen as the government's first step to realise the Prime Minister's goal of doubling the economy to 5 trillion dollars within the next five years.
Budget 2019: PAN-Aadhaar interchangeability
"More than 120 crore Indians now have Aadhaar. Therefore, for ease and convenience of tax payers, I propose to make PAN and Aadhaar interchangeable and allow those who do not have PAN to file income tax returns by simply quoting their Aadhaar number and also use it wherever they are required to quote PAN," Finance Minister Nirmala Sitharaman said.
Union Budget 2019: Boost to tourism industry
The government is developing 17 iconic tourism sites into world-class tourist destinations and to serve as a model for other tourism sites.
"The iconic tourism sites would enhance visitor experience which would lead to increase visits of both domestic and international tourists at these destinations," Finance Minister Nirmala Sitharaman said.
Budget 2019: Will help farmers, says PM Modi
"These schemes will play a crucial role in doubling the income of farmers by 2022... Tax system will be made simple with this budget and infrastructure will be modernised," Prime Minister Narendra Modi said.
Budget 2019: "Serves all sectors," says Arun Jaitley
"Congratulations to the Hon'ble PM @narendramodi and FM @nsitharaman for the budget 2019-20. The budget besides being a policy document for boosting growth, serves the larger interest of all sectors of the Economy," former Finance Minister Arun Jaitley tweeted.
Union Budget 2019: "Wings to farmers...", tweets Amit Shah
Home Minister Amit Shah tweets on Budget 2019: "Finance Minister @nsitharaman ji presents a #BudgetForNewIndia which lays the foundation of an inclusive & progressive nation, whose rise is powered by the hardwork of 130 crore Indians. The budget gives wings to India's farmers, youngsters, women and poor to fulfil their dreams."
Budget 2019: Clarity for start-ups
- Angel investors and start-ups who file tax returns won't be subjected to scrutiny. E-verification will resolve the issue of identifying the investor and the source of funds.
- "The clarity for start-ups that no inquiry would be made about the valuation of shares going forward as much as for past inquiries, provides a welcome relief to what seemed to be an unseemly tax controversy, defying the logic of taxing income and not capital," said Milind Kothari, managing partner, BDO India, partner and head, tax and regulatory services.
- "No scrutiny by IT department of share premium received by a start-up, this will reduce litigation to a great extent. Big relief for entrepreneurs," said Rajesh Thakkar, partner, transaction tax, tax and regulatory services, BDO India.
Budget 2019: Excise duty on petrol and diesel hiked
- Excise duty on petrol and diesel to be hiked by Re 1 per litre each
- Basic customs duty increased on metal fittings, tiles, auto parts, marble slabs, CCTV camera and IP camera
Budget 2019: GST refund, filing eased
- Centre proposes fully automated goods and services (GST) refund module
- GST software for filing returns
- Automatic invoice system for some companies
- Quarterly returns for taxable people having turnover of Rs 5 crore and less
Budget speech live: Income tax on earnings over Rs 2-5 crore, and Rs 5 crore
Surcharge on individuals with taxable income of Rs 2-5 crore raised to 3%, and Rs 5 crore to 7%
Budget speech live: Benefits for home buyers
- Additional deduction of Rs 1 lakh on interest paid for affordable house of Rs 45 lakh, borrowed on or before March 31, 2020
- After interest deduction, affordable home buyers will gain tax benefit of Rs 7 lakh over the period of interest deduction
Budget speech live: Corporate tax rate expanded
- Corporate tax rate of 25% extended to all companies having annual turnover up to Rs 400 crore
- Manufacturing of electric vehicles and goods and services tax (GST) rate proposed to be reduced from 12 per cent to 5 per cent.
- Additional income tax deduction of Rs 1.5 lakh on interest paid for manufacturing of electric vehicles.
Budget Speech Live: Centre proposes RBI as regulator for home finance firms
- The centre proposes the Reserve Bank of India to be a regulator for housing finance companies. This is likely to bring some order to the housing market.
- New series of coins of Re 1, 2, 5 and 10 to be issued; they are easily identifiable to the visually impaired and will be made available for public use shortly.
- India's sovereign external debt to gross domestic product is among the lowest globally at less than 5 per cent.
- Govt will offer investment option in exchange traded funds (ETFs) to encourage long-term investment.
Budget speech live: Recovery of bad loans
"Financial gains from cleaning up banking system now amply visible," says Finance Minister Nirmala Sitharaman. Non-performing assets (NPAs) reduced by Rs 1 lakh crore since last year. A "record recovery" of Rs 4 lakh crore due in last four years.
Reforms will be undertaken to strengthen governance in public sector banks. Non-banking financial companies (NBFCs) play a crucial role and should continue to get funding from banks and mutual funds. For purchase of high-rated pooled assets of high-rated NBFCs, the government will provide a one-time partial credit guarantee for six months.
Budget Speech Live: Key points
- Banks will provide financial assistance for acquisition of scavenging robots.
- In two years, over 300 entrepreneurs have emerged as a result of the stand-up scheme.
- A TV programme for start-ups under Doordarshan, designed and run by start-ups themselves.
- The government proposes to streamline multiple labour laws into four labour codes.
- A draft legislation for strengthening higher education in India will come up.
- Khelo India Scheme will be expanded to develop sportspersons
- Centre proposes Aadhaar cards for non-resident Indians (NRIs) without waiting for mandatory 180 days after their return to India.
Budget Speech Live: Strengthening higher education
"There was not a single Indian institution in top 200 in world university ranking five years ago. Now, after concentrated and concerted efforts, we have three institutions in top 200. India has the potential to be hub of higher education. We propose to start a programme called 'Study In India' to bring foreign students to India," Finance Minister Nirmala Sitharaman said.
Budget Speech Live: Expanding Swacch Bharat Mission
"9.6 crore toilets have been constructed since October 2, 2014. More than 5.6 lakh villages have become open-defecation free. We have to build on this success. I propose to expand the Swachh Bharat Mission to undertake sustainable solid waste management in every village," Finance Minister Nirmala Sitharaman said.
Budget 2019: Commercialising space power
"India has emerged as a major space power. It is time to harness our ability commercially. To harness India's space ability commercially, a public sector enterprise, New Space India Limited (NSIL) has been incorporated to tap benefits of the ISRO (Indian Space Research Organisation)," said the Finance Minister.
Budget 2019: FDI in media, aviation to be raised
"We will invest in raising foreign direct investment in media and aviation. There will be 100 per cent FDI for insurance intermediaries. All local FDIs will be raised in single-brand retail sector. Global FDI flows slipped by 13 per cent in 2014 to $1.3 trillion from $1.5 trillion the previous year. It was the third decline. However, India's FDI flows remained strong," the Finance Minster said.
Union Budget 2019: Centre proposes "social" stock market
"It's time to take capital markets closer to the masses. We propose to initiate steps for an electronic fundraising platform to list social enterprises and voluntary organisations. This will help social enterprises working for welfare raise capital," Finance Minister Nirmala Sitharaman said.
Budget 2019: Reforms to promote rental housing
"Our current rental laws are archaic. Modern tenancy law will be finalised and circulated to states. Several reforms to promote rental housing will be taken up," the Finance Minister said.
Union Budget 2019: Government pushes for massive infrastructure development
"The people of India have validated their two goals for our country's future: national security and economic growth. India's first indigenous payment ecosystem for transport based on National Common Mobility Card was launched by the Prime Minister in March 2019, enabling people to pay multiple types of transport charges... 657 km of metro rail network has become operational in the country. FAME II scheme aims to encourage faster adoption of electric vehicles by right incentives and charging infra," Nirmala Sitharaman said.
Budget 2019: Connectivity at heart of development, says Finance Minister
"The time is right for India to enter aviation finance and leasing. Connectivity is at the heart of development. We do not look down upon legitimate profit-making. Gone are the days of policy paralysis and Licence Raj. Indian firms are wealth creators," Nirmala Sitharaman said.
Union Budget 2019: "We added $1 trillion in just five years," says Finance Minister
"It took India 55 years to reach a $1 trillion economy. When hearts are with hopes and aspirations, we added $1 trillion in just five years. The common man was served even when transformational reforms were laid out. We have to invest heavily in infrastructure. Citizens felt the difference in every nook and corner. Our focus has been mazboot desh ke liye mazboot nagrik (strong citizens for a strong nation)," Nirmala Sitharaman said.
Budget 2019: Nirmala Sitharaman presents Modi 2.0 Budget in parliament
"We have set the ball rolling for a new India," Finance Minister Nirmala Sitharaman said. "India will become a $3 trillion economy in the current year. It is now the sixth-largest economy, five years ago it was 11th. We are already number three in terms of purchasing power parity.
Union Budget Live 2019: PM Modi arrives at parliament
Prime Minister Narendra Modi has arrived at parliament to attend the Budget 2019 presentation by Finance Minister Nirmala Sitharaman. The much-anticipated New Industrial Policy may be announced by Ms Sitharaman in her Budget.
The policy centered around the theme of "Make in India", was first envisaged in the earlier Modi government under the then Commerce and Industry Minister Suresh Prabhu. New Commerce Minister Piyush Goyal has also given his inputs to the policy, news agency IANS quoted sources as saying.
Budget 2019: Parents of Finance Minister Nirmala Sitharaman in parliament
Parents of Finance Minister Nirmala Sitharaman - Savitri and Narayanan Sitharaman - have arrived at parliament. She will present her first Budget at 11 am in Lok Sabha.
Her Budget is likely to have key points from the Economic Survey. Prime Minister Narendra Modi has set an ambitious target of turning India into a $5 trillion in the next five years from $2.7 trillion, which will require an annual growth rate of over 10 per cent.
Union Budget 2019: Copies of Budget at Parliament House
Copies of Budget 2019 have been brought to parliament. Finance Minister Nirmala Sitharaman will present the Budget at 11 am. The government's Economic Survey, presented to parliament on Thursday, said India will face a challenge on the fiscal front following an economic slowdown impacting tax collections amid rising state expenditure on the farm sector.
However, the investment rate was expected to pick up following improvement in consumer demand and bank lending, the report said.
Union Budget 2019: Basic Tax Exemption Limit To Be Raised To Rs 3 Lakh, Says Report
The middle-class tax payers may have a lot to cheer about in the Budget proposals to be presented by Finance Minister Nirmala Sitharaman today. News agency IANS quoted sources as saying that the Budget 2019 will take the sops announced in the Interim Budget further byraising the basic tax exemption limit
for an individual income tax payer to Rs 3 lakh from Rs 2.50 lakh at present to cover for the inflationary impact over the years.
In the Interim Budget, the government had proposed a rebate on all payable taxes if an individual's taxable income is up to Rs 5 lakh per annum. But it kept the basic exemption levels unchanged.
Budget 2019: Inheritance Tax May Be Reintroduced After 34 Years. Here's Why
Abolished in 1985, an inheritance tax or estate tax is aimed to raise revenues from those who inherit wealth. Many analysts see this as a measure to tax the super rich in the country. At a time marked with shrinking tax collections and rising expenditure
, an inheritance tax may help the government ease some of its fiscal deficit burden, according to analysts. T Haque, chairman of NITI Aayog's Expert Committee on Land Issues, said that 1 per cent people control 58 per cent of the wealth in the country.
"An inheritance tax should be imposed on such people. There is a need to improve the tax-GDP ratio in the economy and inheritance tax will help in lowering the social inequality," he added.
Budget 2019: No Briefcase. Nirmala Sitharaman Makes Statement With Budget Bahi Khata
Finance Minister Nirmala Sitharaman did not pose with the iconic briefcase
, like her predecessors. In a departure from tradition, she was seen holding a red cloth folder enclosed with a string and emblazoned with the national emblem, which was described by officials as the "bahi khata". Chief Economic Advisor Krishnamurthy Subramanian said the Budget briefcase had been replaced by the traditional "bahi khata" in keeping with Indian tradition. "It is in Indian tradition. It symbolizes our departure from slavery of western thought. It is not a budget but a 'bahi khata'(ledger)," Mr Subramanian was quoted as telling news agency ANI.
Nirmala Sitharaman's red folder caused a buzz amid anticipation surrounding her first budget, also the first of Prime Minister Narendra Modi's second term. Especially as the word "Budget" originates from the French "bougette" or leather bag.
Budget 2019: "...Ideas from the Economic Survey"
"I hope many of the ideas from the Economic Survey will find place in the Budget. This is not my first Budget. I have already been part of the Interim Budget. I anticipate the budget to be a good one," said Chief Economic Adviser K Subramanian.
Budget 2019: At the Rashtrapati Bhavan
Following tradition, Finance Minister Nirmala Sitharaman calls on President Ramnath Kovind before presenting the Union Budget 2019 in parliament. She is expected to boost spending while allowing for the fiscal deficit target to rise. The government on Thursday forecast that economic growth could get back up to 7% this year, but cautioned it will face challenges.
Budget 2019: Some constraining factors
For Finance Minister Nirmala Sitharaman, the biggest constraining factor is lower-than-expected growth in tax revenues, particularly those of the goods and services tax (GST), something she may look to bridge through aggressive stake sale in public sector undertakings (PSUs), higher dividend from the Reserve Bank of India (RBI), rollover of some fiscal 2020 expenditure to fiscal 2021, cut back in plan expenditure and increase in off-balance sheet expenditure with portion of subsidies being transferred to state-owned enterprise balance sheet.
Budget 2019: The red cloth
Chief Economic Adviser K Subramanian on Finance Minister Nirmala Sitharaman keeping Budget documents in four-fold red cloth instead of a briefcase: "It is in Indian tradition. It symbolises our departure from slavery of Western thought. It is not a Budget but a bahi khata (ledger)."
Budget 2019: On the income tax front
Some analysts say Finance Minister Nirmala Sitharaman may give relief to citizens by raising personal income tax threshold for certain categories while at the same time, upping spending on agriculture, healthcare and social sectors.
Budget 2019: Government may look at tax cuts for business
Prime Minister Narendra Modi's government will unveil a budget that is expected to cut taxes on business and raise spending in a bid to shore up consumption and faltering economic growth. Analysts say PM Modi, boosted by a sweeping election victory, hopes to use the budget to restart reforms and deal with a series of economic woes.
After becoming Prime Minister in 2014, Narendra Modi improved public finances, trimming the fiscal deficit to 3.4 per cent from 4.5 per cent in 2013-14, mostly through cuts in subsidies and higher retail taxes on fuel. However, he is now under pressure to loosen the purse strings to meet election promises and jack up the growth rate.
Budget 2019: Rural economy and monsoon
A shortfall in monsoon rains, pivotal for the farm sector that constitutes about 15 per cent of the economy, employing nearly half of India's workers, has increased concern about rural distress and strengthened the case for government intervention.
On Thursday, Chief Economic Adviser K Subramanian, who is the main author of the Economic Survey 2018-19, said growth in the economy is expected to pick up in 2019-20 as macroeconomic conditions continue to be stable.
Finance Minister Nirmala Sitharaman arrives at the North Block.
Stock markets are likely to open marginally higher, as indicated by the Nifty futures traded on Singapore Exchange. The SGX Nifty was last seen trading 17.50 points - or 0.15 per cent - higher at 11,997.50. (Check out LIVE market updates here
On Thursday, the S&P BSE Sensex and NSE Nifty 50 benchmark indexes had ended 0.17 per cent and 0.25 per cent higher respectively, extending their gains to a third session in a row after the Finance Ministry's Economic Survey report pegged India's growth at 7 per cent for financial year 2019-20.
Many analysts expect that the personal income tax structure will not be tweaked, as it may contradict the government's aim to expand taxpayers' base. However, some expect tax implications for the super rich.
In her first Union Budget, Finance Minister Nirmala Sitharaman is widely expected to boost spending at the cost of short-term slippage in fiscal deficit targets. The Budget comes at a time when India has lost its top spot as the world's fastest-growing major economy to China. India's GDP or gross domestic product growth slipped to 5.8 per cent in the March quarter - the slowest pace in 20 quarters. (Read more