Budget 2020: Finance Minister Nirmala Sitharaman's speech full text
New Delhi : Finance Minister Nirmala Sitharaman on Saturday presented her second budget announcing perks for the middle-class income group. She announced the launch of a new personal income tax regime which can help the middle-class save taxes and also scrapped dividend distribution tax (DDT).
Read the complete speech of Nirmala Sitharaman below:
Hon’ble Speaker,
I rise to present the Budget for the year 2020-2021.
Introduction
In May 2019, Prime Minister Modi received a massive mandate to form the government again. With renewed vigour, under his leadership, we commit ourselves to serve the people of India, with all humility and dedication.
2. People of India have unequivocally given their jan-aadesh for not just political stability and also reposed faith in our economic policies. This is the Budget to boost their incomes and enhance their purchasing power. Only through higher growth we can achieve that and have our youth gainfully and meaningfully employed. Let our businesses be innovative, healthy and solvent with use of technology.
3. For today’s youth born at the turn of the century, for every member of Scheduled Castes and Scheduled Tribes who seeks a better life, for every woman wishing to stand up and get counted, for every individual from the minority sections of our society – this Budget aims to have your aspirations and hopes addressed.
4. We wish to open up vistas for a vibrant and dynamic economy with a gentle breeze of new technology. This vibrant India shall be a caring society which shall attend to its weak, the old and the vulnerable among its citizens.
5. During 2014-19, our government brought in a paradigm shift in governance. This shift was characterised by a twin focus: fundamental structural reform and inclusive growth.
6. Fundamentals of the economy are strong and that has ensured macroeconomic stability. Inflation has been well contained. Banks saw a thorough cleaning up of accumulated loans of the past decade and then they were recapitalized. Companies were provided an exit through the IBC. Several steps on the formalisation of the economy were taken up.
7. Of the structural reforms, the Goods and Services Tax (GST) has been the most historic in our country. Its chief architect is not with us today. I pay homage to the visionary leader late Shri Arun Jaitley ji. At the time of roll out of GST, he had said and I quote:
“It will be an India where the Centre and States will work harmoniously towards the common goal of shared prosperity. The unanimity of the Constitutional amendment and the consensus of the GST Council highlights that India can rise above narrow politics for the nation’s interest. With the GST, neither the state nor the Centre loses its sovereignty. In contrast, they will pool their sovereignty on decisions on indirect taxes."
8. True to this vision for the historic structural reform, the Goods and Services Tax has been gradually maturing into a tax that has integrated the country economically. It has consolidated numerous taxes and cesses to one tax and facilitated formalization of economy. It has resulted in the efficiency gains in logistic and transport sectors. The turnaround time for trucks has witnessed a substantial reduction to the tune of 20% due to abolition of check posts in GST. The dreaded Inspector-Raj has also vanished.
9. It has also led to significant benefits to MSME by way of enhanced threshold and composition limits. The effective tax incidence on almost every commodity came down substantially. Through several rate reductions, an annual benefit of `one lakh crore has been extended to consumers. It amounts to 10% reduction in overall tax incidence. An average household now saves about 4% on its monthly spends on account of reduced GST rates.
10. During this phase of maturing, GST did face certain challenges. This was natural as transition was daunting. GST Council has been proactive in resolving issues during transition. In the last two years we have added more than 60 lakh new taxpayers, a total of about 40 crore returns were filed, 800 crore invoices were uploaded, and 105 crore e-way bills were generated. There has been extensive engagement with stakeholders. A simplified new return system is being introduced from April 1, 2020.
11. A former Prime Minister had once voiced a concern that the fruits of the welfare schemes were not reaching the intended citizens – the common and deserving citizen was only receiving 15 paisa of every rupee sent for him. Guided by “SabkaSaath, SabkaVikas, SabkaVishwas", our government and our Prime Minister added manifold speed and scaled up the implementation of schemes and programmes that directly benefitted the poor and the disadvantaged. I wish to list out only a few as examples: (a) welfare schemes with Direct Benefit Transfer (DBT) embedded in them; (b) sanitation and water as provision of basic needs and as a measure of preventive healthcare; (c) healthcare, through Ayushman Bharat; (d) clean energy through Ujjwala and solar power; (e) financial inclusion, credit support, insurance protection to vulnerable sections and pension scheme; (f) digital penetration with broadband and UPI;(g) Affordable Housing for all through PMAY.
The milestones achieved are unprecedented, globally recognised and benchmarked against international indices.
12. This strategy, changed the established order of a few individuals cornering most of the benefits and was appreciated by the people. This had immensely positive outcomes. We have moved on from a growth rate of just over 4% in 1950s to 6% in 1980s and1990s. However, during 2014-19 we clocked growth of 7.4% on average with inflation, averaging around 4.5%. It is worthwhile to note that inflation was close to 9% in the last two decades of the last millennium and ranged 10.5% during 2009-14. Between 2006-16, India was able to raise 271 million people out of poverty, which we all should be proud of.
13. We are now the fifth largest economy of the world. India’s foreign direct investment got elevated to the level of US$ 284billion during 2014-19 from US$ 190billioin that came in during the years 2009-14. The Central Government debt that has been the bane of our economy got reduced, in March 2019, to 48.7% of GDP from a level of 52.2%in March 2014.
14. With this backdrop, our government shall work towards taking the country forward so that we can leapfrog to the next level of health, prosperity and well-being. We shall strive to bring Ease of living for every citizen.
15. I am mindful of presenting this budget in the backdrop of two cross-cutting developments:
a) Proliferation of technologies, specially analytics, machine learning, robotics, bio-informatics and Artificial Intelligence; and
b) The number of people in the productive age group i.e. 15-65 years in India, being at its highest.
16. This combination is special to contemporary India. Across the world, if there is a shrinking of globalisation, equally, there is a debate on the efficacy of monetary policy too. The efforts we have made in the last five years and the energy, enthusiasm and the innovation of our youth are the ignition required to push forward. The Indian spirit of entrepreneurship which weathered several storms over the centuries inspire and motivate us. We recognise the need to support and further energise this spirit.
17. This budget is woven around three prominent themes:
One: Aspirational India in which all sections of the society seek better standards of living, with access to health, education and better jobs.
Two: Economic development for all, indicated in the Prime Minister’s exhortation of “SabkaSaath, SabkaVikas, SabkaVishwas". This would entail reforms across swathes of the economy. Simultaneously, it would mean yielding more space for the private sector. Together, they would ensure higher productivity and greater efficiency.
AND
Three: Ours shall be a Caring Society that is both humane and compassionate. Antyodaya is an article of faith.
18. The digital revolution which has placed India in a unique leadership position globally will see the next wave. We shall aim:
• To achieve seamless delivery of services through Digital governance
• To improve physical quality of life through National Infrastructure Pipeline
• Risk mitigation through Disaster Resilience
• Social security through Pension and Insurance penetration.
Each one of these initiatives and their components would be bench-marked to international standards and the indices would be announced soon.
19. To Summarize my introductory remarks, this Budget Speaker Sir, is dedicated to provide “Ease of Living" to all citizens. As mentioned, a little earlier, the details under the three broad themes – Aspirational India, Economic Development and Caring India are the flowers in the bouquet that is Ease of Living. Holding this bouquet together are two hands – one, Corruption free, policy-driven good governance and two, clean and sound financial sector.
20. The three themes described earlier form the basis of my subsequent presentation. They are the flowers of the bouquet that underline the overall concept of “Ease of Living" and need to uplift Governance, as pronounced by our Prime Minister Shri Narendra Modi. The chapter on Finances and subsequent Part B on Taxes provide the necessary underpinning to the Budget that lays the guide map for next year and beyond.
Before, I move to elaborate on each of the three themes, I wish to recite a small verse in Kashmiri:
SaunWatanGulzarShalamaarHyur
Dal ManzPholvunPamposhHyuv
Navjavan-an-hund, VushunKhumaarHyuv
MyonWatan, ChyonWatan
SaunWatan, NundbonyWatan
(Everything that we do, all of us do, is for this beautiful country)
Poem by Pandit Dinanath Koul
Aspirational India
21. I shall cover programmes and plans related to: (1) Agriculture Irrigation and Rural development (2) Wellness, Water and Sanitation and (3) Education and Skills Agriculture, Irrigation and Rural Development
22. Our government is committed to the goal of doubling farmers’ incomes by 2022. We have provided energy sovereignty through KUSUM and input sovereignty through Paramparagat Krishi Vikas Yojana. We have provided resilience for 6.11 crores farmers insured under PM Fasal Bima Yojana. Focus on cultivation of pulses, expansion of micro-irrigation through Krishi Sinchai Yojana, have raised the self-reliance of the country. Provision of any annual supplement of the income to the farmer, directly is done through PM-KISAN. Connectivity through PMGSY, financial inclusion have helped raise farm incomes.
22 (1). Prosperity to farmers can be ensured by making farming competitive. For this, farm markets need to be liberalised. Distortions in farm and livestock markets need to be removed. Purchase of farm produce, logistics and agri-services need copious investments. Substantial support and hand-holding of farm-based activities such as livestock, apiary, and fisheries need to be provided for. Farmers desire integrated solutions covering storage, financing, processing and marketing.
23. Adopting sustainable cropping patterns and bringing in more technology are integral to our plan. All this and more can be achieved through working with and in cooperation with the States.
The following 16 action points indicate our focus:
23 (1). We propose to encourage those State governments who undertake implementation of following model laws already issued by the Central government:
a) Model Agricultural Land Leasing Act, 2016
b) Model Agricultural Produce and Livestock Marketing (Promotion and Facilitation) Act, 2017;, and
c) Model Agricultural Produce and Livestock Contract Farming and Services (Promotion and Facilitation) Act, 2018
23(2). Water stress related issues are now a serious concern across the country. Our government is proposing comprehensive measures for one hundred water stressed districts.
23(3). In the Budget speech of July 2019, I had stated that “annadata" can be “urjadata" too. The PM-KUSUM scheme removed farmers’ dependence on diesel and kerosene and linked pump sets to solar energy. Now, I propose to expand the scheme to provide 20 lakh farmers for setting up stand-alone solar pumps; further we shall also help another 15 lakh farmers solarise their grid-connected pump sets. In addition, a scheme to enable farmers to set up solar power generation capacity on their fallow/barren lands and to sell it to the grid would be operationalized.
23 (4). Our government shall encourage balanced use of all kinds of fertilizers including the traditional organic and other innovative fertilizers. This is a necessary step to change the prevailing incentive regime, which encourages excessive use of chemical fertilisers.
பூமி திருத்தி உண்
ஆத்திச்சூடி –82
BhumitiruthiUnn
- Wise, Old Tamil Woman Saint poet Aauvaiyar – Sangam Era
"Aaathichoodi" verse 81
The meaning of this saying is that one must “first tend to till one's land and then eat". One must eat only after work.
23 (5). India has an estimated capacity of 162 million MT of agri-warehousing, cold storage, reefer van facilities etc. NABARD will undertake an exercise to map and geo-tag them. In addition, we propose creating warehousing, in line with Warehouse Development and Regulatory Authority (WDRA) norms. Our government will provide Viability Gap Funding for setting up such efficient warehouses at the block/taluk level. This can be achieved, where States can facilitate with land and are on a PPP mode. Food Corporation of India (FCI) and Central Warehousing Corporation (CWC) shall undertake such warehouse building on their land too.
23 (6). As a backward linkage, a Village Storage scheme is proposed to be run by the SHGs. This will provide farmers a good holding capacity and reduce their logistics cost. Women, SHGs shall regain their position as “Dhaanya Lakshmi".
23 (7).To build a seamless national cold supply chain for perishables, inclusive of milk, meat and fish, the Indian Railways will set up a “Kisan Rail" – through PPP arrangements. There shall be refrigerated coaches in Express and Freight trains as well.
23 (8).KrishiUdaan will be launched by the Ministry of Civil Aviation on international and national routes. This will immensely help improve value realisation especially in North-East and tribal districts.
23 (9). Horticulture sector with its current produce of 311million MT exceeds production of food grains. For better marketing and export, we propose supporting States which, adopting a cluster basis, will focus on “one product one district".
23 (10). Integrated farming systems in rainfed areas shall be expanded. Multi-tier cropping, bee-keeping, solar pumps, solar energy production in non-cropping season will be added. Zero-Budget Natural Farming (mentioned in July 2019 budget) shall also be included. The portal on “jaivikkheti" – online national organic products market will also be strengthened.
23 (11).Financing on Negotiable Warehousing Receipts (e-NWR) has crossed more than`6000crore. This will be integrated with e-NAM.
23 (12). Non-Banking Finance Companies (NBFCs)and cooperatives are active in the agriculture credit space. The NABARD re-finance scheme will be further expanded. Agriculture credit target for the year 2020-21 has been set at ` 15 lakh crore. All eligible beneficiaries of PM-KISAN will be covered under the KCC scheme.
23 (13). Our government intends to eliminate Foot and Mouth disease, brucellosis in cattle and also peste des petits ruminants(PPR) in sheep and goat by 2025. Coverage of artificial insemination shall be increased from the present 30% to 70%. MNREGS would be dovetailed to develop fodder farms. Further, we shall facilitate doubling of milk processing capacity from 53.5 million MT to 108 million MT by 2025.
23 (14). Blue Economy: Our government proposes to put in place a framework for development, management and conservation of marine fishery resources.
23 (15).Youth in coastal areas benefit through fish processing and marketing. By 2022-23, I propose raising fish production to 200 lakh tonnes. Growing of algae, sea-weed and cage Culture will also be promoted.
Our government will involve youth in fishery extension through 3477 SagarMitras and 500 Fish Farmer Producer Organisations. We hope to raise fishery exports to ` 1 lakh crore by 2024-25.
23 (16).Under DeenDayal Antyodaya Yojana for alleviation of poverty, 58 lakh SHGs have been mobilised. We shall further expand on SHGs.
24. Now, for the fund allocation for the 16 different steps mentioned above, they are being stated under two different categories:
For the sector comprising of Agriculture and allied activities, Irrigation and Rural Development an allocation of about `2.83 lakh crore has been made for the year 2020-21 . Its divided, inter-alia;
a) For Agriculture, Irrigation & allied activities - ` 1.60 lakh crore
b) For Rural development &Panchayati Raj - ` 1.23 lakh crore
Wellness, Water and Sanitation
Under Aspirational India, I shall now speak about Wellness, Water and Sanitation.
25. We have a holistic vision of healthcare that translates into wellness of the citizen. Mission Indradhanush has been expanded to cover 12 such diseases, including five new vaccines. FIT India movement is a vital part of fight against Non communicable diseases coming out of life style issues. A very focused safe water (Jal Jeevan Mission) and comprehensive sanitation program (Swachch Bharat Mission) have been launched to support the health vision. That would reduce the disease burden on the poor.
26. Presently, under PM Jan Arogya Yojana (PMJAY) ,there are more than 20,000 empanelled hospitals. We need more in Tier-2 and Tier-3 cities for poorer people under this scheme.
26 (1). It is proposed to set up Viability Gap funding window for setting up hospitals in the PPP mode. In the first phase, those Aspirational Districts will be covered, where presently there are no Ayushman empanelled hospitals. This would also provide large scale employment opportunities to youth. Proceeds from taxes on medical devices would be used to support this vital health infrastructure
26 (2). Using machine learning and AI, in the Ayushman Bharat scheme, health authorities and the medical fraternity can target disease with an appropriately designed Preventive regime.
27. “TB Harega Desh Jeetega" campaign has been launched. I propose to strengthen these efforts realise our commitment to end Tuberculosis by 2025.
28. I propose to expand Jan Aushadhi Kendra Scheme to all districts offering 2000 medicines and 300 surgicals by 2024.
I have provided for the health sector about `69,000 crores that is inclusive of ` 6400 crores for Prime Minister Jan Arogya Yojana (PMJAY)
29. Our government is committed to ODF Plus in order to sustain ODF behaviour and to ensure that no one is left behind. Now, more needs to be done towards liquid and grey water management. Focus would also be on Solid waste collection, source segregation and processing.
Total allocation for Swachh Bharat Mission is about `12,300 crore in 2020-21.
30. Aiming to provide piped water supply to all households, Prime Minister announced from the Red Fort the Jal Jeevan Mission. Our government has approved `3.60 lakh crore for this Mission. This scheme also places emphasis on augmenting local water sources, recharging existing sources and will promote water harvesting and de-salination. Cities with over a million population will be encouraged to meeting this objective during the current year itself.
During the year 2020-21the scheme would be provided budget of `11,500crore.
Education and Skills
The third and the final item under Aspirational India is Education and Skills.
31. By 2030, India is set to have the largest working-age population in the world. Not only do they need literacy but they need both job and life skills. Dialogues have been held with State Education Ministries, Members of Parliament and other stake-holders about Education policy. Over 2 lakh suggestions were also received. The New Education Policy will be announced soon.
32. It is felt that our education system needs greater inflow of finance to attract talented teachers, innovate and build better labs. Therefore steps would be taken to enable sourcing External Commercial Borrowings and FDI so as to able to deliver higher quality education.
33. Students in the general stream (vis-à-vis services or technology stream) need their employability improved. About 150 higher educational institutions will start apprenticeship embedded degree/diploma courses by March 2021.
34. The government proposes to start a programme whereby urban local bodies across the country would provide internship opportunities to fresh engineers for a period up to one year.
35. In order to provide quality education to students of deprived section of the society as well as those who do not have access to higher education, it is proposed to start degree level full-fledged online education programme. This shall be offered only by institutions who are ranked within top 100 in the National Institutional Ranking framework. Initially, only a few such institutions would be asked to offer such programmes.
36. India should be a preferred destination for higher education. Hence, under its “Study in India" programme, Ind-SAT is proposed to be held in Asian and African countries. It shall be used for benchmarking foreign candidates who receive scholarships for studying in Indian higher education centres.
37. A National Police University and a National Forensic Science University are being proposed in the domain of policing science, forensic science, cyber-forensics etc.
38. There is a shortage of qualified medical doctors, both general practitioners as well as specialists. In order to meet this requirement;
38 (1). It is proposed to attach a medical college to an existing district hospital in PPP mode. Those states that fully allow the facilities of the hospital to the medical college and wish to provide land at a concession, would be able to receive Viability Gap Funding. Details of the scheme would be worked out.
38 (2). National Board of Examination imparts PG medical qualifications ; Diploma and fellow of National Board (DNB/FNB). The Government will, therefore encourage large hospitals with sufficient capacity to offer resident doctors DNB/FNB courses under the National Board of Examinations.
39. There exists a huge demand for teachers, nurses, para-medical staff and care-givers abroad. However, their skill sets, many a time, do not match the employer’s standards and therefore need to be improved. I propose that special bridge courses be designed by the Ministries of Health, Skill Development together with professional bodies to bring in equivalence. Language requirements of various countries need also to be included. All these should be achieved through special training packages.
Our Government proposes to provide about ` 99,300 crore for education sector in 2020-21 and about ` 3,000 crores for skill development.
Economic Development
Industry, Commerce and Investment
The guilds of Saraswati-Sindhu civilization & the Harappan seals are remarkable. They belong to 3300 BCE.Words from the Indus Script-hieroglyphs have been deciphered. Commerce and trade related words show how India for a millennia is continuing as richin skills,metallurgy, trade etc. “Takara Kolimi=Tin smithery", “ Sreni “= Guild," Sethi"= wholesale merchant, “Poddar"= Assayer of metal into treasury.
40. Entrepreneurship has always been the strength of India. Even today, young men and women have given up greener pastures elsewhere to contribute to India’s growth. They are risk-taking and come up with disruptive solutions to festering challenges. Equally, established old industries are resetting themselves in a changing global and domestic situation. We recognise the knowledge, skills and risk-takingcapabilities of our youth. He is no longer the job seeker. He is creator of jobs. Now we wish to create more opportunities and remove road-blocks from his path.
I propose to set up an Investment Clearance Cell that will provide “end to end" facilitation and support, including pre-investment advisory, information related to land banks and facilitate clearances at Centre and State level. It will work through a portal.
41. There is a case for maximising the benefits of three separately developing economic activities: (1) the upcoming economic corridors; (2) revitalisation of manufacturing activities; and (3) Technology and the demands of aspirational classes. We have to benefit from their convergence. Hence, it is proposed to develop five new smart cities in collaboration with States in PPP mode. Such sites would be chosen that offer the best choices in terms of aforementioned principles.
42. India needs to manufacture Networked products. That will make it a part of global value chains. This in turn gets more investment and generates more employment for our youth.
42 (1). Electronics manufacturing industry is very competitive and India has shown its cost advantages. The potential of this industry in job creation is immense. India needs to boost domestic manufacturing and attract large investments in the electronics value chain. Here, I propose a scheme focussed on encouraging manufacture of mobile phones, electronic equipment and semi-conductor packaging. Details would be announced later.
42(2). With suitable modifications, this scheme can be adapted for manufacture of medical devices too
43. India imports significant quantity of technical textiles worth US$ 16 billion every year. To reverse this trend and to position India as a global leader in Technical Textiles, a National Technical Textiles Mission is proposed with a four-year implementation period from 2020-21 to 2023-24 at an estimated outlay of ` 1480 crore.
44. From the Red Fort, our Prime Minister spoke about quality and standards when he spoke of “Zero Defect-Zero Effect" manufacturing. In September last year, I had called for a time-bound adoption by industry of all necessary, mandatory technical standards and their effective enforcement. All Ministries, during the course of this year, would be issuing quality standard orders.
45. To achieve higher export credit disbursement, a new scheme, NIRVIK is being launched, which provides for higher insurance coverage, reduction in premium for small exporters and simplified procedure for claim settlements.
46. It is proposed to digitally refund to exporters, duties and taxes levied at the Central, State and local levels, such as electricity duties and VAT on fuel used for transportation, which are not getting exempted or refunded under any other existing mechanism. This Scheme for Reversion of duties and taxes on exported products will be launched this year.
47. It is the vision of the Prime Minister that each District should develop as an export hub. Efforts of the Centre and State governments are being synergised and institutional mechanisms are being created.
48. Government e-Marketplace (GeM) is moving ahead for creating a Unified Procurement System in the country for providing a single platform for procurement of goods, services and works. It offers a great opportunity for Medium, Small and micro Enterprises(MSMEs). 3.24 lakh vendors are already on this platform. Its proposed to take its turnover to ` 3lakh crores.
I propose to provide about `27,300 crore for development and promotion of Industry and Commerce for the year 2020-21.
Under the theme “Economic Development", the second focus is on Infrastructure.
Infrastructure
49. Hon’ble Speaker, Sir, in his Independence Day speech 2019, Prime Minister had highlighted that ` 100 lakh crore would be invested on infrastructure over the next 5 years. As a follow up measure, I had launched the National Infrastructure Pipeline on 31st December 2019 of ` 103 lakh crore. It consists of more than 6500 projects across sectors and are classified as per their size and stage of development.
These new projects will include housing, safe drinking water, access to clean and affordable energy, healthcare for all, world-class educational institutes, modern railway stations, airports, bus terminals, metro and railway transportation, logistics and warehousing, irrigation projects, etc. The National Infrastructure Pipeline envisions improving the ease of living for each individual citizen in the country. It’s also will bring in generic and sectoral reforms in development, operation and maintenance of these infrastructure projects.
A huge employment opportunity exists for India’s youth in construction, operation and maintenance of infrastructure. National Skill Development Agency will give special thrust to infrastructure-focused skill development opportunities.
50 (1). I propose to set up a project preparation facility for infrastructure projects. This programme would actively involve young engineers, management graduates and economists from our Universities.
50 (2). It is also proposed to direct all infrastructure agencies of the government to involve youth-power in start-ups. They will help in rolling out value added services in quality public infrastructure for citizens.
51. A National Logistics Policy will be released soon. Inter alia; it will clarify the roles of the Union Government, State Governments and key regulators. It will create a single window e-logistics market and focus on generation of employment, skills and making MSMEs competitive.
52. Accelerated development of highways will be undertaken. This will include development of 2500 Km access control highways, 9000 Km of economic corridors, 2000 Km of coastal and land port roads and 2000 Km of strategic highways.
Delhi-Mumbai Expressway and two other packages would be completed by 2023 . Chennai-Bengaluru Expressway would also be started.
53. FASTag mechanism encourages us towards greater commercialisation of our highways so that NHAI can raise more resources. I propose to monetise at least twelve lots of highway bundles of over 6000 Km before 2024.
54. In carrying out its duty, the Indian Railways performs a service to the nation.
a) Within 100 days of assumption of this government, it has commissioned 550 wi-fi facilities in as many stations.
b) Eliminated unmanned crossings
c) Aims to achieve electrification of 27000 Km of tracks.
This will call for optimisation of costs. Railways has small operating surplus. About Indian Railways, there are five measures, among others, that I wish to highlight:
• Setting up a large solar power capacity alongside the rail tracks, on the land owned by the railways. A proposal is under consideration.
• Four station re-development projects and operation of 150 passenger trains would be done through PPP mode. The process of inviting private participation is underway.
• More Tejas type trains will connect iconic tourist destinations.
• High speed train between Mumbai to Ahmedabad would be actively pursued.
• 148 km long Bengaluru Suburban transport project at a cost of Rs 18600 crore, would have fares on metro model. Central Government would provide 20% of equity and facilitate external assistance up to 60% of the project cost.
55. Our sea-ports need to be more efficient. Technology has to used to improve performance. A governance framework keeping with global benchmarks needs to be put in place.
This government would consider corporatizing at least one major port and subsequently its listing on the stock exchanges.
56. Inland Waterways received a boost in the last five years. The Jal Vikas Marg on National Waterway-1 will be completed. Further, the 890 Km Dhubri-Sadiya connectivity will be done by 2022.
Developing waterways has its impact on the eco-system on both the banks of the river. Our Prime Minister has conceptualised “Arth Ganga". Plans are afoot to energise economic activity along river banks.
57. Air traffic has been growing rapidly in the country as compared to global average. One hundred more airports would be developed by 2024 to support Udaan scheme. It is expected that the air fleet number shall go up from the present 600 to 1200 during this time.
I propose to provide about ` 1.70 lakh crore for transport Infrastructure in 2020-21.
58. Taking electricity to every household has been a major achievement. However, the distribution sector, particularly the DISCOMS are under financial stress. The Ministry intends to promote “smart" metering. I urge all the States and Union Territories to replace conventional energy meters by prepaid smart meters in the next 3 years. Also, this would give consumers the freedom to choose the supplier and rate as per their requirements.
Further measure to reform DISCOMs would be taken.
I propose to provide about ` 22,000 crore to power and renewable energy sector in 2020-21
59. In the upstream sector of oil and gas, the Open Acreage Licensing Policy (OALP) is a success having awarded 1,37,000 sq km for exploration to private sector and to the CPSEs. City gas distribution rights are also awarded.
60 (1). Further, it is proposed to expand the national gas grid from the present 16200 km to 27000 km, and
60 (2). To deepen gas markets in India, further reforms will be undertaken to facilitate transparent price discovery and ease of transactions.
New Economy
61. The new economy is based on innovations that disrupt established business models. Artificial intelligence, Internet-of-Things (IoT), 3D printing, drones, DNA data storage, quantum computing, etc., are re-writing the world economic order. India has already embraced new paradigms such as the sharing economy with aggregator platforms displacing conventional businesses. Government has harnessed new technologies to enable direct benefit transfers and financial inclusion on a scale never imagined before.
62. It is now a cliché – “data is the new oil" and it is true that Analytics, Fintech and Internet of Things (IOT) are changing the way we deal with our lives. To take advantage of this, I propose:
62 (1). To bring out soon a policy to enable private sector to build Data Centre parks throughout the country. It will enable our firms to skilfully incorporate data in every step of their value chains.
62 (2). Our vision is that all “public institutions" at Gram Panchayat level such as Anganwadis, health and wellness centres, government schools, PDS outlets, post offices and police stations will be provided with digital connectivity. So, Fibre to the Home (FTTH) connections through Bharatnet will link 100,000 gram panchayats this year.
It is proposed to provide ` 6000 crore to Bharatnet programme in 2020-21.
63. We need to expand the base for knowledge-driven enterprises. Intellectual property creation and protection will play an important role. Several measures are proposed in this regard, which will benefit the Start-ups.
63 (1). A digital platform would be promoted that would facilitate seamless application and capture of IPRs. Also, in an Institute of Excellence, a Centre would be established that would work on the complexity and innovation in the field of Intellectual Property.
63 (2). Knowledge Translation Clusters would be set up across different technology sectors including new and emerging areas.
63 (3). For designing, fabrication and validation of proof of concept, and further scaling up Technology Clusters, harbouring such test beds and small scale manufacturing facilities would be established.
63 (4). Mapping of India’s genetic landscape is critical for next generation medicine, agriculture and for bio-diversity management. To support this development, we will initiate two new national level Science Schemes, to create a comprehensive database.
63 (5). The government proposes to provide early life funding, including a seed fund to support ideation and development of early stage Start-ups.
64. Quantum technology is opening up new frontiers in computing, communications, cyber security with wide-spread applications. It is expected that lots of commercial applications would emerge from theoretical constructs which are developing in this area.
It is proposed to provide an outlay of ` 8000 crore over a period five years for the National Mission on Quantum Technologies and Applications.
Caring Society
In our third theme we focus on Women &Child, Social Welfare; Culture and Tourism and also on Environment and Climate Change.
Women & Child, Social Welfare
65. I am pleased to inform the House that “Beti Bachao Beti Padhao" has yielded tremendous results. Gross enrolment ratio of girls across all levels of education is now higher than boys. At elementary level, it is 94.32 % as against 89.28% for boys. At Secondary level, it is 81.32 % as compared to 78 %, At higher secondary level girls have achieved a level of 59.70 % as compared to 57.54 % for boys.
66. Health of mother and child are closely corelated. Nutrition is the critical component of health. To improve the nutritional status of children (0-6 years), adolescent girls, pregnant women and lactating mothers, our Prime Minister launched a “Poshan Abhiyan" in 2017-18. More than six lakh anganwadi workers are equipped with smart phones to upload the nutritional status of more than 10 crore households. The scale of these developments is unprecedented.
67. Women’s age of marriage was increased from fifteen years to eighteen years in 1978,by amending erstwhile Sharda Act of 1929. As India progresses further, opportunities open up for women to pursue higher education and careers. There are imperatives of lowering MMR as well as improvement of nutrition levels. Entire issue about age of a girl entering motherhood needs to be seen in this light. I propose to appoint a task force that will present its recommendations in six months’ time.
I propose to provide `35600crore for nutrition-related programmes for the financial year 2020-21.
68. In continuing with our government’s commitment to the welfare of women, this budget provides for about ` 28,600crore for programs that are specific to women.
69. Our government is determined that there shall be no manual cleaning of sewer systems or septic tanks. Suitable technologies for such tasks have been identified by the Ministry of Housing and Urban Affairs. The Ministry is working with urban local bodies for the adoption of these technologies. We will now take this to its logical conclusion through legislative and institutional changes. Financial support for wider acceptance of such technologies will be provided.
70. In furthering this government’s commitment towards the welfare of Scheduled Castes and Other Backward classes, I propose a budget provision of about`85,000crore for 2020-21.
71. In furthering development and welfare of Scheduled tribes, I provide in the Budget for the year 2020-21 an amount of about `53,700crore.
72. This government is mindful of the concerns of senior citizens and Divyang. Accordingly, an enhanced allocation of about `9,500 crore is being provided for 2020-21.
Culture & Tourism
73. Our government proposes to establish an Indian Institute of Heritage and Conservation under Ministry of Culture; it shall have the status of a deemed University to start with. Acquisition of knowledge in disciplines such as museology and archaeology are essential for collecting and analysing scientific evidence of such findings and for dissemination through high quality museums. Currently lack of trained man-power is a handicap for both these disciplines. This also affects tourism.
74. Five archaeological sites would be developed as iconic sites with on-site Museums. They are: Rakhigarhi (Haryana), Hastinapur (Uttar Pradesh) Shivsagar (Assam), Dholavira (Gujarat) and Adichanallur (Tamil Nadu).
75. Our Prime Minister in January 2020 announced re-curation of the Indian Museum in Kolkata, which is the oldest in the country.
75 (1). In the historic Old Mint building Kolkata, a museum on Numismatics and Trade will also be located. Four more museums from across the country shall be taken up for renovation and re-curation so that a world class experience can be offered to visitors. Our government shall also support setting up of a Tribal Museum in Ranchi (Jharkhand).
75 (2). A maritime museum would be set up at Lothal- the Harrapan age maritime site near Ahmedabad, by Ministry of Shipping.
I propose to provide ` 3,150crore for Ministry of Culture for 2020-21.
76. India has moved up from rank 65 in 2014 to 34 in 2019 in the Travel & Tourism Competitive Index (World Economic Forum). Foreign exchange earnings grew 7.4% to `1.88 lakh crores for the period January to November 2019 from `1.75 lakh crores
Growth of tourism directly relates to growth and employment. States have a critical role to play. I expect the State governments to develop a roadmap for certain identified destinations and formulate financial plans during 2021 against which specified grants will be made available to the States in 2020-21.
For purpose of tourism promotion, I propose to allocate ` 2,500 crore for 2020-21.
Environment & Climate Change
77. In September 2019, the Prime Minister has launched the Coalition for Disaster Resilient Infrastructure (CDRI) with its Secretariat in Delhi. This global partnership is the second such international initiative after the launch of International Solar Alliance in 2015. This Global Partnership will help in addressing a number of Sustainable Development Goals (SDGs), as also the aims of Sendaiframework. It will enhance climate change adaptation with a focus on disaster resilient infrastructure
78. India submitted its Nationally Determined Contribution, under the Paris Agreement in 2015 on a “best effort" basis, keeping in mind the development imperative of the country. Its implementation effectively begins on 1st January 2021. Our commitments as action will be executed in various sectors by the Departments/Ministries concerned through the normal budgeting process.
79. There are yet, thermal power plants that are old and their carbon emission levels are high.
For such power plants, we propose that utilities running them would be advised to close them, if their emission is above the pre-set norms. The land so vacated can be put to alternative use.
80. In large cities having population above one million, clean air is a matter of concern. The government proposes to encourage such States that are formulating and implementing plans for ensuring cleaner air in cities above one million. Parameters for the incentives would be notified by the Ministry of Environment, Forests and Climate change. Allocation for this purpose is `4400 crore for 2020-21.
நல்ல நாடு
பிணியின்மை, செல்வம் விளைவின்பம் ஏமம்
அணியென்ப நாட்டிவ் வைந்து.
குறள்- 738
(The meaning of this kural is that Freedom from illness, wealth, produce, happiness and protection (to subjects); these five, are the ornaments of a kingdom).
Governance
81. Hon’ble Speaker, Sir, all the while I have explained the colour and composition of the bouquet of flowers – schemes and programmes. They were grouped under Aspirational India, Economic Development and Caring India. Now I speak about the two hands that will hold them. One such hand is Governance – clean, corruption-free, policy driven and good in intent and most importantly trusting in faith. Trusting every citizen, the aspirational youth, the hard-working women, the risk-taking entrepreneur, the ever hopeful and untiring farmer or the wise and old senior citizen. Many among them are taxpayers. Others may not be taxpayers today. Our Prime Minister has laid before us Ease of Living as a goal to be achieved on behalf of all citizens. An important aspect of both ease of living and ease of doing business is fairness and efficiency of tax administration. We wish to enshrine in the statutes a “taxpayer charter" through this budget. Our government would like to reassure taxpayers that we remain committed to taking measures so that our citizens are free from harassment of any kind.
82. There has been a debate about building into statutes, criminal liability for acts that are civil in nature. Hence, for Companies Act, certain amendments are proposed to be made that will correct this. Similarly, other laws would also be examined, where such provisions exist and attempts would be made to correct them.
83. The Government intends to introduce major reforms in recruitment to Non-Gazetted posts in governments and public sector banks. At present, candidates have to appear for multiple examinations conducted by multiple agencies at different points of time, for similar posts This places enormous burden on time, effort and cost of young people. To mitigate their hardship faced, it is proposed to set up a National Recruitment Agency (NRA) as an independent, professional, specialist organisation for conduct of a computer-based online Common Eligibility Test for recruitment to Non-Gazetted posts. A test-centre in every district, particularly in the Aspirational Districts would be set up.
84. For speedy disposal of commercial and other disputes, Government has constituted various Tribunals and specialised bodies. It is proposed to evolve a robust mechanism for appointment including direct recruitment to these bodies to attract best talents and professional experts.
85. A stable and predictable business environment is a key objective of this government. There is also a strong argument for ensuring that contracts are honoured. India has a sound framework related to Contracts Act. We shall deliberate upon strengthening it.
86. There is a growing need for the Indian Statistical system to meet the challenges of real time monitoring of our increasingly complex economy. Data must have strong credibility. The proposed new National Policy on Official Statistics would use latest technology including AI. It would lay down a road-map towards modernised data collection, integrated information portal and timely dissemination of information.
87. I am happy to inform that India will host G 20 presidency in the year 2022- the year of 75th anniversary of independence of Indian Nation. During this presidency, India would be able to drive considerably the global economic and development agenda. For this historic occasion, I allocate a sum of ` 100 crore to begin the preparations.
88. North Eastern region has a very high priority in Government’s Developmental agenda. Government is ensuring smooth access to financial assistance from multilateral and bilateral funding agencies to help introduce innovative and global best practices. Central Government has effectively used an online portal to reduce gestation period of online. This has improved the flow of funds to the northeast region.
89. The Government is fully committed to supporting the all-round development of the newly formed Union Territories of J&K and the Union Territory of Ladakh. Accordingly, an amount of `30,757 crore has been provided for the Financial Year 2020-21. An amount of `5,958 crore has been provided for the Union Territory of Ladakh.
Financial Sector
90. If Governance was described as one of the pair of hands holding the bouquet consisting of Aspirational India, Economic Development and Caring India, the other is the Financial Sector. A clean, reliable and robust financial sector is critical to the economy. In our efforts to achieve the USD 5 trillion economy, the financial architecture should keep evolving and move from strength to strength.
91. We had earlier approved consolidation of 10 banks into four. In the last few years, Government of India has infused about` 3,50,000 crore by way of capital into Public Sector Banks for regulatory and growth purposes. Governance reforms would be carried out in these banks, so that they become more competitive.
A few among them will be encouraged to approach capital market to raise additional capital.
92. I wish to inform this august House that robust mechanism is in place to monitor the health of all Scheduled Commercial Banks and that depositors’ money is safe.
Further, the Deposit Insurance and Credit Guarantee Corporation (DICGC) has been permitted to increase Deposit Insurance Coverage for a depositor, which is now `one lakh to `five lakh per depositor.
93. To strengthen the Cooperative Banks, amendments to the Banking Regulation Act are proposed for increasing professionalism, enabling access to capital and improving governance and oversight for sound banking through the RBI.
94. The limit for NBFCs to be eligible for debt recovery under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act 2002 is proposed to be reduced from ` 500 crore to asset size of ` 100 crore or loan size from existing ` 1 crore to ` 50 lakh.
95. In the last few years, the government has taken concrete steps to bring our banking system to be robust. However, there is a need for greater private capital. Accordingly, it is proposed to sell the balance holding of Government of India IDBI Bank to private, retail and institutional investors through the stock exchange.
96. There is a need to take further steps to bring in transparency and greater professionalism in Public Sector Banks. The government will take appropriate measures.
97. To help easy mobility while in jobs, we wish to infuse into the Universal Pension coverage with auto enrolment; also, we wish to place such mechanisms which can enable inter-operability and provide safeguards for the accumulated corpus.
Regulating role of PFRDAI requires strengthening. Necessary amendments would be carried out in Pension Fund Regulatory Development Authority of India Act that will also facilitate separation of NPS trust for government employees from PFRDAI. This would also enable establishment of a Pension Trust by the employees other than Government. I am confident that this will motivate citizens to plan for their old age.
98. MSMEs are vital to keep the wheels of economy moving. They also create job, innovate and are risk takers. Several measures for the MSMEs have been taken in the past few years. There are more steps proposed in this budget also.
98(1). I propose to make necessary amendments to the Factor Regulation Act 2011. This will enable NBFCs to extend invoice financing to the MSMEs through TReDS, thereby enhancing their economic and financial sustainability.
98(2). Working capital credit remains a major issue for the MSMEs. It is proposed to introduce a scheme to provide subordinate debt for entrepreneurs of MSMEs. This subordinate debt to be provided by banks would count as quasi-equity and would be fully guaranteed through the Credit Guarantee Trust for Medium and Small Entrepreneurs (CGTMSE). The corpus of the CGTMSE would accordingly be augmented by the government.
98(3). More than five lakh MSMEs have benefitted from restructuring of debt permitted by RBI in the last year. The restructuring window was to end on March 31, 2020. Government has asked RBI to consider extending this window till March 31, 2021.
98(4). An app-based invoice financing loans product will be launched. This will obviate the problem of delayed payments and consequential cash flows mismatches for the MSMEs.
99. Many mid-size companies are successful domestically but not in export markets. For selected sectors such as pharmaceuticals, auto components and others, we propose to extend handholding support – for technology upgradations, R&D, business strategy etc. A scheme of ` 1000 crore will be anchored by EXIM Bank together with SIDBI. Both these institutions would contribute ` 50 crore each. This ` 100 crore would be achieved towards equity and technical assistance. Debt funding of `900 crore from banks would be made available.
Financial Markets
100. Last year, in the budget speech, I had mentioned about deepening the bond market. To achieve the aspirational growth rate,we would require flow of capital in our financial system. A lot of work has been done on this in consultation with the RBI.
Hon’ble Speaker, Sir, I am pleased to inform this House of the developments:
100(1).Certain specified categories of Government securities would be opened fully for non-resident investors, apart from being available to domestic investors as well.
100(2).The limit for FPI in corporate bonds, currently at 9% of outstanding stock, will be increased to 15% of the outstanding stock of corporate bonds.
100(3).To improve investors’ confidence and to expand the scope of credit default swaps, we propose to formulate a legislation, to be placed soon before the House, for laying down a mechanism for netting of financial contracts.
101. The Debt-based Exchange Traded Fund (ETF) recently floated by the government was a big success. Government proposes to expand this by floating a new Debt-ETF consisting primarily of government securities.
This will give retail investors access to government securities as much as giving an attractive investment for pension funds and long-term investors.
102. To address the liquidity constraints of the NBFCs/HFCs, post the Union budget 2019-20, the government formulated a Partial Credit Guarantee scheme for the NBFCs. To further this support of providing liquidity, a mechanism would be devised. Government will offer support by guaranteeing securities so floated.
Infrastructure Financing
103. Government’s commitment for investment in infrastructure was reiterated when `103 lakh crore National Infrastructure Pipeline projects were announced. I would also like to inform that about ` 22,000 crore has already been provided, as support to Infrastructure Pipeline. This would cater for equity support to Infrastructure Finance Companies such as IIFCL and a subsidiary of NIIF. They would leverage it, as permissible, to create financing pipeline of more than `1,00,000 crore. This would create a major source of long term debt for infrastructure projects and fulfil a long awaited requirement.
104. IFSC, GIFT city has the potential to become a centre of international finance as well as a centre for high end data processing:
104 (1).GIFT IFSC has an approved Free Trade zone for housing vaults. It already has 19 insurance entities, 40 banking entities. It has also provided for setting up of precious metals testing laboratories and refining facilities. With the approval of the regulator, GIFT City would set up an International Bullion exchange(s) in GIFT-IFSC as an additional option for trade by global market participants. This will enable India to enhance its position worldwide, create jobs in India and will lead to better price discovery of gold.
104 (2).In recent years there has been a surge in trading volumes of Indian rupee in the offshore financial centres. The Government and RBI has taken various measures to permit Rupee derivatives to be traded in the International Financial Services Centre at GIFT city, Gujarat.
Disinvestment
105.Listing of companies on stock exchanges discipline a company and provides access to financial markets and unlocks its value. It also gives opportunity for retail investors to participate in the wealth so created. The government now proposes to sell a part of its holding in LIC by way of Initial Public Offer (IPO).
Fiscal Management
106. XV Finance Commission has given its first report pertaining to Financial Year 2020-21. In the spirit of co-operative federalism, I am pleased to announce that we have, in substantial measure, accepted the recommendations of the Commission. The commission would submit its final report to the President during the latter part of the year, for five years beginning 2021-22.
107. It is decided to transfer to the GST Compensation Fund balances due out of collection of the years 2016-17 and 2017-18, in two instalments. Hereinafter, transfers to the fund would be limited only to collection by way of GST compensation cess.
108. A fundamental overhaul of Centrally Sponsored Schemes and Central Sector Schemes is necessary, to align them with emerging social and economic needs of tomorrow, and to ensure that scarce public resources are spent optimally.
109. Recently there has been a debate over transparency and credibility of the projected fiscal numbers. Let me assure the House that the procedure adopted is compliant with the FRBM Act. This is also consistent with the practices hitherto followed.
However, for greater clarity, I have enumerated those central Government debt that are not part of market borrowing and are used to fund the expenditure at the annexes. Servicing of interest and repayment of these debts as hitherto, are done out of Consolidated fund of India.
110. Revised Estimates of Expenditure for the Financial Year 2019-20 are at a level of ` 26.99 lakh Crore and the receipts are estimated at `19.32lakh crore.
We have estimated nominal growth of GDP for year 2020-21, on the basis of trends available, at 10%. Accordingly, receipts for the year 2020-21 are estimated at ` 22.46 lakh cr and, keeping in mind commitment of the Government towards various schemes and need for improvement in quality of life, level of expenditure has been kept at ` 30.42 lakh crore.
During the year Government has unfailingly worked towards keeping up the capital expenditure. Actually, there is substantial enhancement. All the flagship schemes of the government have been fully provided for. Details may be seen at the annexes to the printed copy of my speech.
111. Every budget must appropriately address the issue of fiscal deficit. Recently Government has undertaken very significant tax reforms for boosting investments. However, expected tax buoyancy will take time.
We estimate a fiscal deficit of 3.8% in RE 2019-20 and 3.5% for
BE 2020-21. This estimation is consistent with Government’s abiding commitment to macroeconomic stability. It comprises of,
(a) 3.3% for year 2019-20, and 3% for the 2020-21 budget estimate;
(b) Section 4 (2) of the FRBM Act provides for a trigger mechanism for a deviation from the estimated fiscal deficit on account of structural reforms in the economy with unanticipated fiscal implications. Therefore, I have taken a deviation of 0.5%, consistent with Section 4(3) of FRBM Act, both for RE 2019-20 and BE 2020-21.
Accordingly, the return path is being laid before the parliament as a part of Medium Term Fiscal Policy cum Strategy Statement. This fiscal path commits us to the path of fiscal consolidation without compromising the needs of investment out of public funds.
Accordingly, net market borrowings for the year 2019-20 would be Rs 4.99 lakh crore and for the year 2020-21, it would be `5.36 lakh crore.
112. A good part of the borrowings for the financial year 2020-21 would go towards Capital expenditure of the Government that has been scaled up by more than 21%. As, I had previously mentioned another about ` 22,000 crore have been allocated for equity to fund certain specified infrastructure finance companies, who would leverage it manifold and provide much needed long-term finance to Infrastructure sector. That should spur growth impulses in the economy.
I would, now, move to Part B of my speech.
PART B
Direct Tax
113. Mr Speaker, Sir, our Government has spearheaded radical fiscal measures to ensure that India’s economy continues to tread the path of high growth. These are times when countries are competing with each other like never before to become the most attractive destination for doing business. Therefore, to make sure that India stays globally competitive and a favoured destination for investment, we took a bold historic decision of reducing the corporate tax rate for new companies in the manufacturing sector to an unprecedented level of 15%. Similarly, for the existing companies, the rate has also been brought down to just 22%. As a result, our corporate tax rates are now amongst the lowest in the world. This will enable companies to expand their businesses and make fresh investments in the coming future. Though we will have loss of substantial revenue due to these measures in the short-run, I am certain that our economy will reap huge returns on this score in due course.
प्रजानामेवभूत्यर्थंसताभ्योबलिमग्रहीत्।
सहस्रगुणमुत्स्रष्टुमादत्तेहिरसंरविः॥
Surya, the Sun, collects vapour from little drops of water. So does the King.
They give back copiously. They collect only for people’s wellbeing.
[Verse 18, Sarga 1 Raghuvamsa by Kalidasa]
114. In continuation of the reform measures already taken so far, the tax proposals in this budget will introduce further reforms to stimulate growth, simplify tax structure, bring ease of compliance, and reduce litigations.
115. Personal Income Tax and simplification of taxation
• In the interim Budget of 2019, our government exempted individuals having income up to ` 5 Lakh from paying any income tax. Presently, an individual pays 20% on income between ` 5 Lakh to ` 10 Lakh and 30% on income above ` 10 Lakh. Further, currently the Income Tax Act is riddled with various exemptions and deductions which make compliance by the taxpayer and administration of the Income Tax Act by the tax authorities a burdensome process. It is almost impossible for a taxpayer to comply with the Income-tax law without taking help from professionals.
• In order to provide significant relief to the individual taxpayers and to simplify the Income-tax law, I propose to bring a new and simplified personal income tax regime wherein income tax rates will be significantly reduced for the individual taxpayers who forgo certain deductions and exemptions.
• Under the new regime, an individual shall be required to pay tax at the reduced rate of 10% for income between ` 5 Lakh to ` 7. 5 Lakh against the current rate of 20%.
• For income between ` 7.5 Lakh to ` 10 Lakh he will pay at the reduced rate of 15% against the current rate of 20 %.
• Similarly for the income between ` 10 Lakh to ` 12.5 Lakh the taxpayer will pay at the reduced rate of 20% against the current rate of 30 %.
• The income between ` 12.5 Lakh to ` 15 Lakh will be taxed at the reduced rate of 25% against the existing rate of 30 %. Incomes above ` 15 lakh will be continued to be taxed at the rate of 30 %.
• Those earning up to ` 5 lakhs shall not pay any tax either in the old regime or in the new regime.
• The proposed tax structure will provide significant relief to taxpayers and more so to those in the middle class.
Taxable Income
Slab (`) Existing Tax Rates New Tax Rates
0-2.5 Lakh Exempt Exempt
2.5-5 Lakh 5% 5%
5
