Union Budget 2024: Finance Minister Nirmala Sitharaman presented the Union Budget 2024-25 in the parliament today. The Finance Minister presented the first Union Budget of the Modi 3.0 government and her seventh consecutive one during the Monsoon Session of Parliament. The Budget emphasised support for the poor, women, youth, and farmers, with Finance Minister Sitharaman detailing plans to boost spending, create jobs, and provide relief to the middle class. The Budget also outlined extensive job creation over the next five years, along with significant changes in tax brackets and rates.
Here are key highlights from the Budget 2024 speech:
1. Revision in tax slabs under the new tax regime: Finance Minister Nirmala Sitharaman hiked standard deduction by 50 per cent to Rs 75,000 and tweaked tax slabs under the new income tax regime to provide more money in the hands of salaried class with a view to boost consumption. The tax structure will be revised, saving taxpayers Rs 17,500.
New tax rates are as follows:
- 0-3 lakh: Zero tax
- 3-7 lakh: 5 per cent
- 7-10 lakh: 10 per cent
- 10-12 lakh: 15 per cent
- 12-15 lakh: 20 per cent
- 15 lakh & above: 30 per cent
- Standard Deduction on New Tax Regime increased from Rs 30,000 to Rs 75,000
2. Changes in capital gains taxes: Finance Minister Sitharaman said the government plans to raise the capital gains exemption limit on certain financial assets to Rs 1.25 lakh per year for middle and upper middle class.
- Short-term gains tax on specified financial assets increased from 15 per cent to 20 per cent
- Rrates on other financial and non-financial assets remain unchanged
- Long-term gains tax on all assets raised to 12.5 per cent from earlier 10 per cent
- Exemption limit on capital gains for certain listed financial assets increased from Rs 1 lakh to Rs 1.25 lakh annually
- Long-term classification for listed financial assets is over one year; for unlisted and non-financial assets, it’s over two years
- Unlisted bonds, debentures, debt mutual funds, and market-linked debentures will attract applicable capital gains tax rates, regardless of holding period
- The Budget proposed to abolish angel tax for all investor classes to support start-ups and innovation.
3. Customs duty reductions: Sitharaman proposed a reduction in customs duties on a range of products, including gold, silver, critical minerals, mobile phones and other electronic items, to cut input costs, increase value addition, promote export competitiveness and boost domestic manufacturing.
- Gold and silver duties reduced to 6 per cent, platinum to 6.4 per cent
- Lithium, Copper, Cobalt exempt from Custom Duty
- Expanded list of exempted capital goods for solar cell and panel manufacturing
- Basic Customs Duty on spandex yarn reduced from 7.5 per cent to 5 per cent
- Exempt customs duty on manufacturing of connectors and Oxygen-fused copper.
- Customs duty fully exempted on three additional cancer medicines
- Duty on mobile devices and accessories reduced to 15 per cent
- Increased customs duty on plastic products.
4. Three employment-linked schemes: The government will launch three employment-linked schemes. These schemes will be based on enrolment in Employees' Provident Fund Organization (EPFO)
- About scheme A, will provide one month's wage to those entering the workforce in all sectors.
- The scheme B, will incentivise additional employment into the manufacturing sector linked to the employment of first-time employees.
- The scheme C will cover additional employment in all sectors.
- New hires will receive up to Rs 15,000 in direct benefit transfers (DBT) in three instalments, with a salary cap of Rs 1 lakh per month. This initiative aims to benefit 2.1 lakh youths.
- Employers will be reimbursed up to rs 3,000 per month for two years for each new employee, aiming to support 50 lakh new jobs and 30 lakh youths.
5. Women Empowerment: The government will look at further lowering duties for properties purchased by women and making it an essential component of urban development schemes.
- Govt to look at lowering duties for properties purchased by women
- Govt discontinue the quoting of Aadhaar Enrolment ID in place of Aadhaar number with respect to taxation purposes.
- The government will set up working women hostels to promote the participation of women in the workforce.
6. Agriculture: The Finance Minister allocated Rs 1.52 lakh crore for agriculture and allied sectors for the fiscal year 2024-25.
- A comprehensive review of agricultural research will be undertaken to improve productivity and develop climate-resilient varieties.
- 1 crore farmers will be introduced to natural farming in the coming years. The government plans to enhance Production, storage, and marketing to achieve self-reliance in pulses and oilseeds.
- The budget proposes the development of large-scale clusters for vegetable production near major consumption centres.
- Three-year plan to facilitate the digital public infrastructure for agriculture, aiming to cover farmers and their lands comprehensively.
- Digital crop survey for Kharif crops will be conducted in 400 districts this year
- Jan Samarth-based Kisan Credit Card will be introduced in five states.
