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