The Union Budget 2023-24 was presented by the Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman, on 1st February 2023. The Budget articulates a vision, termed ‘Amrit Kaal’, revolving around opportunities for citizens with a focus on youth, growth, and job creation, along with a strong & stable macro-economic environment.
The Budget also highlights the seven priorities, called ‘Saptarishi’, which aim to guide the country towards ‘Amrit Kaal’.
Key Highlights of the Union Budget 2023-24
- Agriculture and Cooperatives: Build a Digital Public Infrastructure, set up an Agriculture Accelerator Fund, and launch the Atmanirbhar Horticulture Clean Plant Program, among others.
- Health: Establish 157 New Nursing Colleges, launch the Sickle Cell Anaemia elimination Mission, launch a new program to promote research in Pharmaceuticals, encourage Joint Public and Private Medical Research via select ICMR labs, etc.
- Education and Skilling: Revamp Teachers’ training via District Institutes of Education and Training, set up a National Digital Library for children and adolescents, and encourage states to set up physical libraries at Panchayat and ward levels.
Reaching the Last Mile
- Launch the Pradhan Mantri Particularly Vulnerable Tribal Groups Development Mission.
- Provide financial assistance to sustainable micro irrigation in drought-prone areas of Karnataka.
- Increase the recruitment of teachers for 740 Eklavya Model Residential Schools.
- Establish the Bharat Shared Repository of Inscriptions to digitize ancient inscriptions.
Infrastructure and Investment
With the belief that incentives to boost investment in infrastructure will have a multiplier impact on the rise in growth and employment, the government has:
- Increased the capital investment outlay to Rs. 10 lakh crores, i.e., by 33.4%.
- Continued 50-year interest-free loan to State governments to incentivize investment in infrastructure.
- Laid down the highest capital outlay of Rs. 2.4 lakh crores for Railways.
- Identified 100 transport infrastructure projects to ensure proper connectivity for ports, coal, steel, fertilizer, etc.
- Planned to establish the Urban Infrastructure Development fund to create an Urban Infrastructure in Tier 2 and 3 cities.
Unleashing the Potential
To further a trust-based Governance, the Government has planned the following:
- Make AI in India: Set up 3 specialized AI centers in educational Institutes.
- National Data Governance Policy: Introduce the policy to enable access to data for Start-ups and academia.
- Vivad se Vishwas I: Further less stringent execution of contracts for MSMEs.
- Vivad se Vishwas II: Ensure an easier and standardized settlement scheme.
- E-Courts: Launch Phase 3 of E-Courts.
- Entity Digi Locker: Setup Entity Digi Locker for business enterprises and charitable trusts.
- Labs for 5G services: Setting up 100 such labs.
- Lab Grown Diamonds: Enhance R&D for this sector.
- PM-PRANAM: Launch the PM Programme for Restoration, Awareness, Nourishment, and Amelioration of Mother Earth to promote the usage of alternative fertilizers.
- Green Credit Programme: Notify the Programme under the Environment Protection Act.
- ‘Waste to Wealth’ plants: Establish 500 new such plants under the GOBARdhan scheme to promote a circular economy.
- Sustainable Ecosystem Development: Take up the Mangrove Initiative for Shoreline Habitats and Tangible Incomes and implement Amrit Dharohar to optimally utilize wetlands.
- Other Initiatives: Setup 10,000 bio-inputs resource centers, promote battery energy storage systems, promote coastal shipping for energy-efficient transport, allocate funds to replace old polluting vehicles, etc.
- Launch PMKVY 4.0 to cover new courses like coding, robotics, AI, 3D printing, etc.
- Establish 30 Skill India International Centres to skill the youth for international opportunities.
- Develop at least 50 destinations as a complete package for boosting the tourism sector.
- Promote and sell One District-One Product, GI, and handicraft products via the setting up of Unity Malls.
- Set up the National Financial Information registry to enable efficient lending.
- Launch the Mahila Samman Bachat Patra.
- Setup a Central Data Processing Centre to handle administrative work under the Companies Act quickly.
- Extend and revamp a Credit Guarantee scheme for MSMEs for additional collateral-free credit.
- Enhance the maximum deposit limit for senior citizens’ savings scheme.
- Promote business activities in GIFT IFSC.
- Create more trained professionals in Securities Markets.
To reduce the burden of compliance and provide tax relief to citizens, the Budget has provided a new Income Tax Regime, which is as follows:
With this regime, the exemption limit for Income Tax has been increased to Rs. 3 Lakhs. In addition to this, the income limit for a rebate of income tax has been increased from Rs. 5 Lakhs to Rs. 7 Lakhs. The benefits of standard deduction are extended to the salaried class and pensioners as well.
Other than this, there have been several changes in the indirect tax regime as well including the reduction of the number of customs duty rates, legislative changes in customs laws as well as GST laws.
Tax Benefits for Industries
- MSME: Microenterprises and professionals can avail benefits of presumptive taxation at enhanced limits. 95% of the receipts will be non-cash. Deduction on payments made to MSMEs will only be allowed when payment is made.
- Cooperatives: The 15% corporate tax benefits are extended to new cooperatives that are starting manufacturing till 31st March 2024. A higher limit of Rs. 3 crores has been set for TDS on withdrawal of cash for cooperative societies.
- Start-Ups: For tax benefits, the date of incorporation will be extended by one year. The benefit of carrying forward losses on a change of shareholding is increased from 7 years to 10 years.
- Rationalisation: In certain sectors, the income of authorities, boards, and commissions established by Union or State Statutes will be exempted. The period of tax benefits to funds relocating to IFSC, GIFT City is extended till 31st March 2025.