“Unlock Hope & Excitement: Discover Union Budget 2023-24 Key Highlights Now!”
As India enters an era of unprecedented growth, the recently unveiled Union Budget 2023 has left citizens with much to be hopeful and excited about. The focus on expanding capital expenditure (Capex) is a reflection of the Modi government’s commitment to further develop our roads, highways, and railway lines. The new income tax regime includes tweaks that bring both short-term and long-term relief for the middle class. FM upheld his fiscal deficit target for FY 24 at 5.9%, staying true to his roadmap and objective for this current year.
Here , we will discuss upon the key takeways of the budget 2023-24-
7 Priorities For First Budget in Amrit Kaal have been set forth by FM Nirmala Sitharaman.
- Reaching the final mile,
- investing in infrastructure,
- releasing potential,
- promoting green growth,
- empowering youth,
- advancing the financial sector and
- inclusive development.
The Budget documents mentioned above can be summarized as follows:-
Annual Financial Statement (AFS):-
The Annual Financial Statement (AFS) of the Government of India for the fiscal years 2023–24, 10 estimates for 2022–23, and actuals for the fiscal year 2021–22 are all published. Together, the Revenue and Capital sections form the Union Budget. Consolidated Fund funds are taken out and placed in the Public Account to be used for specific purposes. The Union collects taxes through the imposition of various duties and other proceeds. Government fees and other receipts for services are all regarded as non-taxable receipts.This also applies to payments of interest and dividends by the government. The Union Territory Government, state governments, and other parties are given loans and advances by the federal government. Spending on assets like land, buildings, machinery, and equipment is included in capital payments.
THE DEMAND FOR GRANTS:-
According to Article 113 of the Constitution, estimates of Consolidated Fund of India expenditure must be included in the Annual Financial Statement and put to the Lok Sabha’s vote. There are 102 demands for grants in the budget for 2023–24. Each Demand includes all funding required to provide a service, such as revenue and capital expenditures, grants to state and union territory governments, loans and advances related to the service, as well as revenue and capital expenditures.
Bill of Finance
In accordance with Article 110 (1)(a) of the Constitution, a Finance Bill that describes how taxes are to be imposed, abolished, exempted, changed, or regulated is also submitted to Parliament at the same time as the Annual Financial Statement.Other budget-related provisions that could be categorized as money bills are also included in it. The Constitution’s Article 110 defines a finance bill as a money bill.
The FRBM Act stipulates Fiscal Policy Statements to be made.
In accordance with the Fiscal Responsibility and Budget Management Act of 2003, the Macroeconomic Framework Statement must be delivered to Parliament. It also includes a description of the specific underlying assumptions and an assessment of the likelihood of economic growth. Included are the Central Government’s GDP growth rate, the stability of the domestic economy, and the external sector.
The Medium-Term Fiscal Policy and Fiscal Policy Strategy Statement is submitted to Parliament in accordance with Section 3 of the Fiscal Responsibility and Budget Management Act of 2003. It outlines the three-year rolling targets for particular fiscal indicators in relation to GDP at market prices, including I Fiscal Deficit, (ii) Revenue Deficit, (iii) Primary Deficit, (iv) Tax Revenue, (v) Non-Tax Revenue, and (vi) Central Government Debt. The Statement explains how the current fiscal policies adhere to good fiscal management principles and provides justification for any significant deviations in important fiscal measures.
The Budget for Expenditures
Establishment The Expenditure Budget Umbrella of Centers’ Expenditure covers all Center expenditures as well as those for Central Public Sector Enterprises and Autonomous Bodies as well as other Central expenditures, such as those on central public sector schemes.The following 3 sub-categories are included under the umbrella term “Transfers to States/UTs”: Centrally Sponsored Scheme, Finance Commission, and Other Transfer to States.
Budget for the “Receipts”
The report provides data on capital receipts in addition to tax and non-tax revenue receipts. The Central Tax System’s Statement of Revenue Impact of Tax Incentives, which attempts to list the revenue impact of tax incentives put forth by the Central Government, is also included. Additionally included are the NSSF National Small Savings Fund (NSSF), the Statement of Liabilities, the Statement of Guarantees, and information regarding External Assistance.
The Profile of Expenditure:-
According to the merger decision for the Plan-Non Plan, the document has been revised. It provides an aggregate of various expenditure categories as well as a few other items across demands.
Certain classes of receipts, such as payments made from one department to another and receipts of capital projects or schemes, are taken in reduction of the expenditure of the receiving department under the current accounting and budgetary procedures. In order to avoid overstating receipts and expenditure figures, the document also makes other improvements, like netting expenditure of related receipts. It contains assertions that highlight significant differences between BE 2022–23 and RE 2022–24. Scheduled Caste Sub Scheme (SCSS), Tribal Sub Scheme (TSS), and (iii) Schemes for the Welfare of Children are among the Scheduled Tribes and Castes that are included.
The estimates of expenditure included in the Annual Financial Statements are for net amounts, whereas the estimates of expenditure included in the Demands for Grants are for gross amounts.
Spending on the Schemes
A significant portion of the Central Government’s total spending is allocated to program expenses. The Expenditure Profile lists all of the Ministries’ budget allocations under various headings, such as Establishment, Other Central Expenditure, Transfer to States, Centrally Sponsored Schemes, Central Sector Schemes, and Establishment, and it also emphasizes the allocations for particular significant programs and initiatives. The document also contains statements that demonstrate projects that received outside assistance.
The Public Sector Enterprises
The Department of Public Enterprises published a separate document titled “Public Enterprises Survey” that provides a comprehensive report on how public sector enterprises operate. The Annual Reports of the various Ministries, which are distributed separately to Members of Parliament, include a report on the operation of the businesses under the supervision of the various administrative Ministries. Each of the Government companies separately presents its annual reports and audited financial statements to the Parliament. Additionally, the Comptroller and Auditor General of India’s reports on the operations of various PSEs are also presented to Parliament.
Overview of the Budget
An important declaration of governmental policy is the central government’s budget. The economy of the nation shapes and is shaped by the Budget. Along with general information on revenues and other receipts, it displays receipts and disbursements. Additionally includes information on the resources given to State and Union Territory governments.
- India’s economy is expected to grow by 7% this year, making it the largest major economy’s brightest star.
- Rural Focus – FM announces that the centre will Spend Rs 2 lakh cr on Free Food Grains for all priority households under PM Garib Kalyan Yojana.
- One of the budget’s top priorities would be green growth, which will help reduce carbon intensity and create green jobs.
- A youth-focused agriculture accelerator fund and open-source digital infrastructure for agriculture are two initiatives the Union Government is focusing on to reform the agriculture sector.
- The government will invest Rs 2200 billion in high-value horticulture and upped its target for agricultural credit to Rs 20 lakh billion.
- The government will begin a mission to eradicate sickle cell anemia by 2047, according to the budget for 2023.
- In the next three years, 157 new nursing colleges will open their doors as part of the vulnerable tribal group (PVTG) project, which will cost $15,000,000,000 over three years.
- The Center’s capex target for 2023–24 is Rs. 10 lakh crore, which is 33% more than the budget estimate of Rs. 7.5 lakh crore for 2022–23.
- Aim for an expenditure increase of PM Housing (PMAY) of Rs 79,000 crore
- The government is proposing 2.40 lakh crore for Indian Railways, which is nine times more than FY14.
- The legalization of the permanent account number (PAN) as a single business identification is provided by Digilocker, a one-stop system for maintaining KYC.
- Extension of the 50-year interest-free loan to state governments by one more year
- MSMEs will benefit from the revamped programs starting in 2023 thanks to an infusion of Rs 9,000 crore into the corpus, which will allow for another Rs 2 lakh crore in collateral-free credit and reduce the cost of credit by about 1%.
- A pan-India national apprenticeship program will be launched with the Direct Benefit Transfer (DBT) scheme for youths in order to support 47 lakh young people over the course of three years.
- An all-time high of Rs 15.43 lakh crore will be borrowed by the Centre through bonds in 2023–24; however, the borrowing program has been set at Rs 11.8 lakh crore in net terms. These figures are generally consistent with the market.
- The Customs Duty – • Exemption from customs duty on the import of certain mobile phone components, such as camera lenses and batteries, for an additional year; a 2.5% reduction in open cells for TV panels; etc.
- Cigarette-related taxes Compound rubber increased from 10% to 25%, up 16%, and so forth.
- More than 6.54 billion returns were processed through the tax portal this year in direct taxes.
- Major relief for all taxpayers under the new system. A new tax system will take over as the default tax system.The highest income tax rate under the new system is currently 42.74%.
- The FM has suggested raising the maximum tax rate from 39% to 39% while lowering the highest surcharge from 37% to 25%.
- Personal Income Tax:
|0 to 3 lakh||NIL|
|More than 15 lakh||30%|