The Union Budget 2024, presented by Finance Minister Nirmala Sitharaman, encompasses a wide range of reforms, tax adjustments, and fiscal strategies aimed at bolstering India’s economic growth. This comprehensive overview highlights the key takeaways from the budget, with a focus on individual taxpayers and business owners.
Key Tax Reforms
- Overhaul of Capital Gains Taxes: Short-term gains are taxed at 20% for all financial assets. For other assets, the previous rates apply. Long-term gains are taxed at 12.5% on all assets, with an annual exemption of ₹1.25 lakh on profits.
- Standard Deduction Increase: The standard deduction has been raised from ₹50,000 to ₹75,000, benefiting salaried individuals.
- Family Pension Deduction: The deduction for family pension has increased from ₹15,000 to ₹25,000.
- New Tax Slabs in the New Regime:
- 0-3 Lakh: Nil
- 3-7 Lakh: 5%
- 7-10 Lakh: 10%
- 10-12 Lakh: 15%
- 12-15 Lakh: 20%
- Above 15 Lakh: 30%
- Angel Tax Abolished: This tax has been removed for all categories of investors, encouraging more investment in startups.
Economic and Fiscal Measures
- Securities Transaction Tax (STT): The STT on futures and options (F&O) has increased to 0.2%.
- Capital Expenditure: The capital expenditure is maintained at ₹11.11 lakh crore, representing 3.4% of GDP.
- Fiscal Deficit: Reduced to 4.9% of GDP, with the aim to lower it further to below 4.5% by FY26.
- Mobile Phones and Chargers: Basic Customs Duty (BCD) on these items has been reduced to 15%.
- Schemes for Women and Girls: Over ₹3 lakh crore allocated for schemes benefiting women and girls.
Employment and Skill Development
- Mudra Loans: The limit for Mudra loans has been increased from ₹10 lakh to ₹20 lakh for those with a good repayment history.
- Prime Minister’s Package: Five schemes and initiatives for employment and skill development, targeting 4.1 crore youth over five years with a central outlay of ₹2 lakh crore.
- Skilling Schemes: New centrally-sponsored scheme for skilling in collaboration with states and industry to skill 20 lakh youth over five years.
Agriculture and Rural Development
- Digital Coverage for Farmers: Initiatives to cover farmland and farmers digitally to ensure they receive their dues.
- Climate-Resilient Seeds: Development of 109 high-yielding, climate-resilient seeds for field and horticulture crops.
- Rural Development: ₹2.66 lakh crore allocated for rural development, including infrastructure enhancement.
Infrastructure and Urban Development
- Industrial Nodes: Development of industrial nodes along the Amritsar-Kolkata Industrial Corridor.
- Transit Oriented Development: 14 large cities with populations above 30 lakh to have transit-oriented development plans.
- Housing Initiatives: PM Awas Yojana Urban 2.0 to cover 1 crore urban poor and middle-class families.
Innovation and Research
- Anusandhan National Research Fund: Set up with a pool of ₹1 lakh crore to spur private sector-driven research and innovation.
- Space Economy: A venture capital fund of ₹1000 crore for the space economy.
Social Welfare
- Female Labour Force Participation: Initiatives to increase female labour force participation, with current rates rising to 37%.
- Financial Assistance for Veteran Artists: A scheme to provide financial assistance to artists aged 60 years and above.
Custom Duties and Trade
- Custom Duties: Reductions in customs duties on 25 critical minerals, including gold and silver.
Digital and Ease of Doing Business
- Jan Vishwas Bill 2.0: Enhancing the ease of doing business through digitalization and incentivizing states to implement business reforms.
New Tax Slabs in the New Regime
| Income Range (₹) | Tax Rate |
|---|---|
| 0-3 Lakh | Nil |
| 3-7 Lakh | 5% |
| 7-10 Lakh | 10% |
| 10-12 Lakh | 15% |
| 12-15 Lakh | 20% |
| Above 15 Lakh | 30% |
Capital Expenditure Over the Years
| Year | Capex (₹ Lakh Crore) |
|---|---|
| 2019 | 3.1 |
| 2021 | 4.4 |
| 2022 | 5.5 |
| 2023 | 7.5 |
| 2024 | 10 |
| 2025 | 11.1 |
Conclusion
The Budget 2024 brings a host of reforms and fiscal strategies aimed at promoting economic growth, investment, and development across various sectors. Individual taxpayers and business owners stand to benefit significantly from the new tax regimes, increased deductions, and various schemes aimed at employment and skill development. With a strong focus on infrastructure, digitalization, and ease of doing business, the budget lays down a comprehensive roadmap for India’s future growth.