Budget 2021: What you need to know
On 1st February 2021, Finance Minister Nirmala Sitharaman presented the Union Budget for the coming financial year 2021-2022 in the Parliament. This budget was announced at a time when the country is still reeling from the effect of the current COVID-19 pandemic which caused a lot of economic and social disruption.
This Budget 2021 has not provided any income tax relief to tax payers. There’s been no changes in income tax slabs but it has eased tax compliance for senior citizens aged 75 years or above. It proposed that senior individuals having pension income and interest from fixed deposit in the same bank should be exempted from filing income tax returns, if the full amount of taxable income has been deducted by the paying bank for the financial year beginning 1st April.
Sitharam also announced a new centrally sponsored scheme, PM AtmaNirbhar Swasth Bharat Yojana, with a budget of Rs. 64,180 crores. This will be in addition to the National Health Mission which will be launched over 6 years. It’s aim is to strengthen existing national health institutions and create new institutions to better fight new and emerging diseases.
Budget 2021 will also see an increase in Foreign Direct Investment (FDI) limit in insurance from 49% to 74%. This is the second such change since 2012, when the government approved the increase of the FDI limit in the insurance sector in India from the 26% to 49%. LIC, BPCL, and Air India would be disinvested to compensate for the over expenditure caused due to the pandemic.
To make India even more Swachch, the budget is also focused on complete faecal sludge management and waste water treatment, source segregation of garbage, reduction in single-use plastic, reduction in air pollution. This will be done by managing waste from construction-and-demolition activities and bio-remediation of all legacy dump sites. This Urban Swachh Bharat Mission 2.0 with a budget of Rs. 1,41,678 crores will be implemented over 5 years.
To enable the textile industry to go global and boost employment generation, a scheme of Mega Investment Textiles Parks (MITRA) will be launched. Under this scheme, a total of 7 Textile Parks will be established over 3 years to help India become global champions in exports.
As for the education system, a National Digital Educational Architecture (NDEAR) will be set up to not only support teaching and learning activities but also educational planning, governance and administrative activities of the Centre and the States/ Union Territories. This scheme will provide a diverse education eco-system architecture for development of digital infrastructure.
Sitharaman also announced a total financial expenditure of around Rs. 2,00,000 crore on healthcare with Rs. 35,000 crore solely on the development and dosage of COVID-19 vaccines.
Apart from this, certain changes have been made in the CGST Act and the IGST Act based on recommendations made by the GST Council. After her speech, Sensex climbed up to 47451.62, with an increase of 1165.85 points.