The Rights of the Deceased: Moral Rights Incidental to Copyright Law
- Vanshika Agrawal
- 2024-04-25
Decoding Budget 2021 – The fiscal deficit is high and needs to remain higher for a couple of years for a growing economy like India has been rightly defended.”
– Shailendra Kumar of Narnolia
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Decoding Budget 2021 – Nirmala Sitharaman, Finance Minister of Modi Government presented the first budget after the Covid-19 Pandemic on 1st February 2021 as a third stage economic strategy amidst the farmer’s protest over the Centre’s new farm laws.
GDP has fallen drastically as lockdowns have restricted activities. There was a lot of expectation from this budget but the finance minister had to find a balance. As the economy is dealing with a pandemic, GDP stands at 6.8% whereas the estimated GDP was 9.5%. A sharp decrease has been seen in the GDP. Even before the pandemic, government borrowings were already on borderline.
The first and foremost thing, the income tax rate does not change. They are steady. It was a relief for many taxpayers albeit many expected a decrease in them due to the Covid-19 pandemic. According to FM, ITR taxpayers have increased to 6.48 crore in 2020 from 3.14 crore in 2014. The FM has said that the government has extended the tax deduction of 1.5 lakhs on the interest paid on home loans for the purchase of affordable homes till 31st March 2022. The government dedicated to the commitment of the supply of affordable homes for migrant workers. This incentive will give bane to the economy and promote housing at affordable rates.
The FM has proposed that the taxpayers above the age of 75 years need not file returns if they are pensioners. A dispute resolution committee is propose for small taxpayers. Anyone up to the taxable income of 50 lakhs and disputable income of 10 lakhs can approach the dispute resolution.
Budget 2021 has restricted the tax exemption for the interest income earned on the employee’s contribution to various provident funds. If the employee’s contribution to the provident fund whether it is statutory or voluntary exceeds the limit of 2.5 lakhs annum, then the interest earn on this excess contribution will be taxable. Only those contributions made on or after April 1, 2021, will be accounted for taxation. Hence, taxpayers will need to figure out alternatives from April 2021.
The unit link insurance policy i.e., ULIP’s also attract capital gain tax if the annual premium paid to exceeds 2.5 lakhs per year. However, this will apply only to ULIP’s bought after 1st February 2021. The provision for employee’s contribution towards provident fund and ULIP’s is to make provision for as to rich do not escape tax paying by investing in a tax-free instrument for the middle class. But this will also bring consequences for the middle class who want to invest money to gain profit in long term by adding tax claims to their investments.
Another provision for the pre-filled income tax forms will come with more details easing the workload of both the taxpayer and the government. The time limit of the opening of the income assessment goes down to 3 years from the earlier 6 years.
A new incentive initiate that will reduce the cost of the taxpayer and increase transparency in the working is the national faceless income tax national authority center i.e., ITAT. Advance tax will now be applicable on dividend income only after declaration.
The agriculture and farmers welfare association will receive 5.63% more allocation of the budget out of which half of it would be spent on the PM KISAN scheme and slightly higher funds will be made available for the agri-infra fund and irrigation programs.[1]
Decoding Budget 2021 Finance Minister has reinforced the governments’ commitments towards the Atmanirbhar Bharat. The government has planned to allocate 20,000 Crore towards the Public Sector Banks. The FM in her speech mentioned introducing the bill for Development Finance Institution (DFI). The aim of the proposed bill will be targeting a portfolio of 5 crores in 3 years. Albeit previous attempts have made but with proper and professional management. It will give a long-term boost to the economy of the country.
A proposition is to revise the definition of Small Companies under the Companies Act, 2013 increasing their thresholds for Paid-up capital from “not exceeding `50 Lakh” to “not exceeding `2 Crore” and turnover from “not exceeding `2 Crore” to “not exceeding `20 Crore”.[2]
The speech contained the proposal to consolidate the SEBI Act, Securities Contract Act. The Government Securities Act, and the Depositories Act. The government also aims to amend the insurance act by bringing up the FDI limit from 49% to 74% and also allowed foreign ownership.
A boost has given to the health care sector due to the Covid-19 pandemic. The allocation of funds is approximately 2.23 lakh Crores which is a 137% increase from the last year’s budget. 35,000 Crore have allotted for the Covid-19 Vac 35,000 Crore have allotted for the Covid-19 Vaccines expenditure in the FY 22. The FM announced two more vaccination shortly. The major introduction has done in the health sector. 4 regional National Institutes for virology. Opening of 15 Health Emergency Operation Centers and 2 Mobile Hospitals.
The Government has announced highway and roadways in Kerala, Tamil Nadu, West Bengal, and Assam. The FM announced a vehicle scrapping policy which was already going on. The fitness test, 20 years for personal vehicles and 15 years for commercial vehicles. Railways have announced to electrify the whole railway network till 2030. One of the surprising things about the budget was there was no major increase in the Defence budget. As earlier there was a cliff between India and China at the border. Especially at the Eastern Ladakh.
Another major introduction is a new gas pipeline project in Jammu & Kashmir after the revocation of Article 370. An extension is given to the Ujjwala Scheme to cover 1 crore more beneficiaries.
The companies were under the impression that the government might introduce a new tax on the face of the Covi-19 pandemic. As there was no new introduction, the companies were at such a relief. The budget 2021 has given relaxation to the NRI’s. It will increase the number of days for a person to consider as a resident Indian for taxation purposes. Overall, it can be said that the Union Budget 2021 is up to the mark budget focusing on all the major sectors. Budget 2021 provides much-needed velocity to the economy.
[1] https://timesofindia.indiatimes.com/business/india-business/union-budget-2021-explained-in-15-charts/articleshow/80631848.cms
[2] Para 80 https://www.indiabudget.gov.in/
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