Key Highlights of Union Budget 2020

Here are some key highlights of Union Budget for 2020-21

*FY21 ESTIMATES*
* Fiscal deficit seen at 3.5% of GDP
* Net market borrowing pegged at 5.36 trln rupees
* Gross market borrowing at 7.8 trln rupees
* Pegs nominal GDP growth at 10%
* Receipts seen at 22.46 trln rupees
* Total spending seen at 30.42 trln rupees

*FY20 REVISED*
* Net market borrowing pegged at 4.99 trln rupees
* Fiscal deficit seen at 3.8% of GDP
* Receipts 19.32 trln rupees
* Spending revised to 26.99 trln rupees

*FISC HEALTH*
* Expected tax buoyancy will take time
* Good part of govt borrowing to be used for capex
* Fully provided for all flagship schemes of govt
* To activate FRBM Act escape clause on structural reforms
* Fundamentals of economy strong
* Centre's debt down to 48.7% of GDP Mar 2019 vs 52.2% Mar 2014

GROWTH, INFLATION
* India now 5th largest economy in the world
* FY14-19 average GDP growth 7.4%
* Financial structure must keep evolving to become $5-trln economy
* Stable, predictable business environment a key objective
* Reliable, robust, clean financial sector critical for economy

DIRECT TAX
* Looking at inverted duty structure under GST
* Introducing Aadhaar-based verification for indirect taxes
* Instant allotment of PAN on basis of Aadhaar
* To amend Income Tax Act to help merged PSU banks to absorb losses
* To waive interest on tax disputes if amount paid by Mar 31
* Propose scheme to settle old direct tax cases
* To amend laws to allow faceless tax appeals
* Propose to abolish dividend distribution tax
* Dividend to be taxed only in hands of recipient
* Revenue forgone on dividend distribution tax 250 bln rupees
* To review, rationalise tax exemptions over next few years
* New power cos to attract 15% corporate tax
* Cooperatives can be taxed at 22% without exemptions
* Concessional 4% withholding tax on bonds listed in GIFT City
* Proposes some tax sops on ESOPs of staff at startups
* Deferring tax payment on sale of ESOP for 5 yrs in start-ups
* Concessional 5% withholding tax extended to municipal bonds
* Can avail new tax rates if not availing some exemptions
* Tax holiday for affordable housing extended by 1 year
* Turnover threshold for audit of MSMEs hiked to 50 mln rupees
* Tax on income above 1.5 mln rupees at 30%
* Person with income of 1.5 mln rupees to get 78,000-rupee relief
* No tax on income below 500,000 rupees
* Cut tax on income of 1.25-1.50 mln rupees to 25%
* Cut tax on income of 1.00-1.25 mln rupees to 20%
* Cut tax on income of 750,000-1 mln rupees to 15%
* Cut tax on income of 500,000-750,000 rupees to 10%
* New direct tax scheme optional for taxpayers
* Large benefits for taxpayers under new direct tax regime
* Propose to significantly reduce income tax in new regime
* To bring simplified personal income tax regime
* Tax proposals to bring ease of compliance, reduce litigation
* Tax proposals focused on simulating growth
* Want to enshrine taxpayers' charter into statute
* Tax harassment can't be tolerated
* 100% tax exemption on sovereign wealth funds' infra investment
* Removed 70 of 100 income tax exemptions in new regime
* Revenue foregone on income tax cut at 400 bln rupees/year

INDIRECT TAX
* Propose nominal health cess on import of medical devices
* Customs duty on footwear, furniture raised
* To review remaining customs duty exemptions
* Some customs duty exemptions being withdrawn
* To review rules of origin for imports under free trade deal
* Amending laws to ensure no undue gains for imports under FTA
* To transfer FY17, FY18 cess balance to GST compensation fund
* GST compensation to states to be limited to cess collection
* GST helped add 6 mln tax payers in 4 years
* Average household saves 4% of monthly spend due to GST
* Effective tax for all commodities came down due to GST
* GST did face certain challenges
* Turnaround time for trucks cut by 20% due to GST
* Inspector Raj has vanished due to GST
* GST has resulted in efficiency gains
* GST has been gradually maturing
* GST has facilitated formalisation of economy
* GST extended 1-trln-rupee benefit annually to consumers

REFORMS
* Accepted substantial recommendations of 15th finance panel
* To improve quality of life through national infra pipeline
* Already provided 220 bln rupees for national infrastructure pipeline
* To encourage states to follow model laws made by Centre

FINANCIAL SECTOR, MARKETS
* Propose to divest LIC via IPO
* GIFT City to set up international bullion exchange
* To enhance credit guarantee scheme for NBFCs
* To allow NRIs to buy certain govt securities
* To float new debt ETF comprising primarily of gilts
* Some gilts to be completely available to overseas investors
* FPI limit in corporate bonds to be raised to 15% from 9%
* To amend Factoring Regulation Act to cover NBFCs
* Asked RBI to mull extending MSME recast window by 1 more year
* Encourage PSU banks to approach capital mkt for fund raising
* Have robust system to check health of scheduled commercial banks
* To amend Banking Regulation Act to strengthen co-op banks
* "Depositors money absolutely safe"
* Deposit insurance cover hiked to 500,000 rupee/depositor
* To sell govt stake in IDBI Bank to private investors
* FY14-19 saw twin focus on structural reforms, inclusive growth
* Banks saw clean-up, recapitalisation during FY14-19
* Aim for seamless delivery of svcs via digital governance
* Recognise need to support energised spirit of entrepreneurs
* Note there is global discussion on monetary policy efficacy
* To carry out governance reforms in PSU banks
* To mull strengthening National Contracts Act
* Propose new national policy on national statistics
* To ensure civil offence has no criminal penalty in Cos Act

INFRASTRUCTURE, INDUSTRY
* Allocate 273 bln rupees in FY21 to develop commerce, industry
* To allot 14.8 bln rupees on national technical textile mission
* Plan project preparation facility for infra pipeline
* India needs to boost domestic manufacturing
* To launch new export credit scheme NIRVIK
* NIRVIK to have higher insurance cover, lower premiums
* NIRVIK scheme for small exporters
* Moot new manufacturing scheme for medical devices
* Need to boost manufacturing of electronic items in India
* Scheme for mobile phone manufacture, semiconductor packaging
* Scheme also for electronic equipment manufacturing
* Plan five new smart cities via PPP mode
* Propose to set up an investment clearance cell
* Investment clearance cell to work through a portal
* To create single window for e-logistics market
* To soon release national logistics policy
* To digitally refund duties to exporters
* All ministries to issue quality standard orders
* Propose 1.7 trln rupees for transport infra FY21
* To seek external funds for Bengaluru suburban rail network
* To develop 100 more airports by 2024 to support UDAAN scheme
* To mull listing at least 1 key port on bourses
* Plan more Tejas-type trains to connect tourist locations
* Moot large solar capacity alongside tracks on railway land
* To actively pursue Mumbai-Ahmedabad high-speed train
* Aim to achieve 27,000 km electrification for railway tracks
* Need commercialisation of highways for NHAI to raise funds
* To monetise over 12 lots of highway bundles before 2024
* Delhi-Mumbai expressway to be completed by 2023
* To start Chennai-Bengaluru Expressway
* Allocate 220 bln rupees for power, renewable sector in FY21
* To expand national gas grid to reach 27,000 km
* To announce more reforms for transparent price discovery in gas
* To develop Bengaluru city rail network for 186 bln rupees
* To take more steps to reform power distribution cos
* Intend to promote pre-paid smart electricity metering
* 100,000 gram panchayats to be linked with Bharat Net this year
* Propose 60 bln rupees for Bharat Net programme in FY21
* Policy to enable pvt sector to set up data centre parks
* Moots 80 bln rupees for quantum technology plan for 5 years
* Two national-level science schemes to map India genetic landscape
* Propose 25 bln rupees to promote tourism in FY21
* To provide 31.5 bln rupees for culture ministry in FY21
* Propose to set up tribal museum in Ranchi
* Propose 44 bln rupees for clean air in FY21
* Advised to shut thermal power units if emission above limit
* Propose to set up national recruitment agency
* Propose national recruitment agency for non-gazetted posts
* To decriminalise some norm violations under Companies Act
* To set up international bullion exchange in GIFT City

FARM SECTOR
* Agri services need copious investments
* Farm markets need to be liberalised
* To unveil 16 action plans to focus on farm sector
* Committed to doubling farmers' income by 2022
* To help 1.5 mln farmers to solarise grid connected pump sets
* Solar power from farms to be sent to grids
* Expanding KUSUM plan to 2 mln farmers for solar powered pumps
* Provided energy sovereignty through KUSUM scheme
* Moot comprehensive steps for 100 water stressed districts
* Rural road plan, fincl inclusion helped raise farm income
* To launch Krishi Udaan scheme for domestic, global routes
* Krishi Udaan to help value realisation in tribal areas
* Krishi Udaan to help value realisation in northeast
* Railways to form kisan rail for perishable cold supply chain
* Kisan rail for perishables' cold supply chain through PPP
* Viability gap funding for warehousing at block, taluk levels
* NABARD to map, geo-tag farm warehouses, cold storage
* To further strengthen NABARD refinance
* Must change regime incentivising excessive chemical fertiliser use
* To have framework for development, mgmt of marine resources
* To raise fish output to 20 mln tn by FY23
* Target 500 fish farmer producer organisations
* To double milk processing capacity to 108 mln tn by 2025
* MGNREGA to be used to develop fodder farms
* To expand NABARD refinance scheme to NBFCs, co-operatives
* Negotiable warehousing receipts to be integrated with e-NAM
* Give support to states for cluster-based horticulture farm
* Agri credit target for FY21 set at 15 trln rupees
* To strengthen online national farm products market
* Zero-budget farming is govt's focus area
* To support states adopting 'one fruit for one district' plan
* Integrated farming systems in rain-fed areas to be expanded
* To set up warehouse regulatory, development authority
* Allocation for farm, irrigation, rural development 2.83 trln rupee
* Farmer Producer Organisation to now include fish farmers

SOCIAL SECTOR, EDUCATION
* Allocate 690 bln rupees for health sector
* To allocate 30 bln rupees for skill development in FY21
* Allocate 993 bln rupees for education sector in FY21
* Jal Jeevan Mission allocation 115 bln rupees in FY21
* Swachh Bharat Mission allocation 123 bln rupees in FY21
* Govt scaled up programmes that aided poor, underprivileged
* Hope to address hopes, aspirations of youth, women, SC/STs
* Govt committed to serve people with humility
* 271 mln people out of poverty
* Strive to bring ease of living for every citizen
* A caring society, humane and compassionate, a Budget theme
* Economic development for all a theme for the Budget
* Antyodaya an article of faith
* Aspirational India a theme for the Budget
* To use proceeds from tax on medical devices for health infra
* Viability gap funding via PPP for setting up hospitals
* Allocate 1.23 trln rupees for rural development
* Indradhanush plan expanded to cover 12 new diseases
* To eradicate tuberculosis by 2025
* New education policy to be announced soon
* Holding talks with states on new education policy
* Want India to be preferred destination for higher education
* Moots 1-year internship for engineers by urban local bodies
* To take steps to enable FX borrow, FDI for education sector
* India to have largest working population in world by 2030
* Propose bridge courses for nurses, teachers for jobs abroad
* Viability gap funding for medical college-local hospital link
* Plan to attach medical college to district hospital via PPP
* To set up national police varsity, forensic varsity
* To have graduate-level online education plan for poor
* Allocate 95 bln rupees for senior citizens, handicapped FY21
* To provide 537 bln rupees for programmes for STs in FY21
* To allocate 850 bln rupees for schemes for SCs, OBCs in FY21
* To provide 286 bln rupees for women-specific plans in FY21
* Propose 356 bln rupees for nutrition-related plans in FY21
* Identified tech for eliminating manual cleaning of sewers