Synopsis: Union Budget 2020-2021

Dr. Anand Wadadekar | Last updated: 01 February 2020

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The Union Budget 2020-21, themed 'Aspiration, Development, Compassion', prioritised national security and introduced several key reforms. It included a new GST return system, a reduction in central government debt, and incentives for farmers to adopt solar energy. The budget also focused on improving education quality, expanding infrastructure, and modernising the railway network.

GENERAL:

Union Budget 2020-21: Key Highlights and Reforms

Finance Minister says:

This Budget Theme: Aspiration, Development, Compassion
National security is the top priority of the government
A new and simplified GST return system coming this April 2020
Central govt's debt has come down to 48.7% in March 2019 from 52.2% in March 2014
Government to incentivize farmers to go solar
'TB Haarega, Desh Jeetega' mission to be launched
Swachch Bharat Abhiyan to get â‚¹12,300 crore
Data is the new oil. A policy to be announced to enable private sector to build data centre parks throughout the country
Conventional energy meters to be replaced by prepaid 'smart meters' in the next three years. Pre-paid meters (smart meters) will give consumers freedom to choose suppliers and tariff
In large cities with population of over 1 million, clean air is a matter of concern
Proposed to set up a national recruitment agency for conduct of computer-based online common eligibility test for recruitment to non-gazetted post
Bank depositor money insurance cover increased to Rs. 5 Lakh from Rs. 1 Lakh
Launch of a system for instant allotment of PAN on basis of Aadhaar

Education:

Steps will be taken to deliver higher quality education
Proposes FDI and ECB in Education
New Education Policy (NEP) to be notified soon
Degree-level full-fledged online education programme to be offered by the top 100 institutions in the country for deprived students
Announces Rs 99,300 crore outlay for education sector in 2020-21 and Rs 3,000 crore for skill development
Under the Study in India programme, an IND-SAT exam is proposed to be held in Asian and African countries
Opportunities for young engineers: Internship with urban local bodies to be introduced
Proposes National Police University and National Forensic Science University

Infrastructure:

National Logistics Policy to be announced
Rs 1.7 lakh crore provided for transport infrastructure in 2020-21
Delhi-Mumbai Expressway to be ready in 3 years
Announces Rs 20,000 crore for the renewable energy sector
100 more airports to be developed by 2025
Five new smart cities to be developed

RAILWAY:

No change in Passenger Fares
Will set up Kisan Rail so that farm goods can be quickly transported across the country

DIRECT TAX:

'Taxpayer Charter' to be introduced as part of statute
Dividend received will be taxable in the hands of taxpayer as per applicable tax slab

Individuals:

Tax Slabs as below (without claiming any deductions/rebates:

Income up to Rs 5 lakh: NIL tax
Income between 5 - 7.5 lakh: Tax at 10%
Income between 7.5 - Rs 10 lakh: Tax at 15%
Income between 10 lakh - 12.5 lakh: Tax at 20%
Income between 12.5 lakh - 15 lakh: Tax at 25%
Income above 15 lakh: Tax at 30%

Corporate:

Corporate Income Tax stands at 22% for existing companies
Dividend Distribution Tax (DDT) abolished. Dividend will be taxable at the hands of dividend recipient.
Concessional tax rate of 15% extended to new power generation companies