Interim Budget 2024: Major announcements under new tax regime

Budget 2024

An interim budget was declared on February 1, 2024. A well-planned budget can contribute to economic stability by ensuring that government spending is sustainable and aligned with the overall economic objectives of the country. It can assist in managing inflation, regulating deficits, and fostering growth and progress. The budget reflects the policy priorities of the government. It provides insights into the government’s agenda, focusing on social welfare, economic reforms, infrastructure development, poverty alleviation, and other key areas.

An interim budget has been established for the year 2024 due to the upcoming elections. The FM declared on February 1, 2024, that “Viksit Bharat Budget 2024” will be the topic of this year’s budget. The honorable Finance Minister, Smt. Nirmala Sitharaman has continued to deliver on plans and benefits, much to the public’s satisfaction. PM Modi praised the interim budget, stating that capital expenditure investments reached a record of Rs 11,111 crore. The budget outlines how government revenues will be collected and expenditures will be allocated across various sectors, such as education, healthcare, infrastructure, defense, etc. It serves as a roadmap for how public resources will be utilized to address the needs and priorities of the nation.

Budget 2024
image credit: istock

Major Announcement of Budget 2024

Income tax

  • Under the new regime, there is no tax on income up to Rs 7.5 lakh (rebate plus standard deduction).
  • The old tax regime is still available, but the new one takes effect by default.
  • Under the new regime, the highest surcharge rate dropped from 37% to 25%.
  • The old tax regime is still available, but the new one takes effect by default.
  • New income tax frames: 0–3 lakh (no tax), 3-6 lakh (5%), 9–12 lakh (10%), 12–15 lakh (20%), and 15 lakh+ (30%).
  • Family pension recipients are eligible to remove Rs15,000 or one-third of their pension, whichever is less.
  • Conversely, the average duration for processing tax returns has decreased from 93 days during 2013–14 to 10 days during 2023–24.
  • The FM declared that throughout the past ten years, direct tax collections have more than tripled, while the number of return filers has increased by 2.4 times.
  • The FM declared that in FY24, the gross GST collection on average has increased to Rs. 1.66 lakh crore each month.

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Railways

  • Railway corridors that are profitable in terms of port access, high traffic density, energy, minerals, and cement can enhance logistics, lower expenses, and improve passenger train operations.
  • To improve passenger safety and convenience, up to 40,000 ordinary train bogies would be upgraded to Vande Bharat standards.
  • Plans are in place to double the number of current tracks, lay new ones, and purchase new engines.

Capital Expenditure

  • The 50-year interest-free credit program for the states will remain in place, with an estimated expenditure of Rs 1.3 lakh crore.
  • To help state governments with milestone-linked reforms, an additional Rs 75,000 crore has been recommended as a 50-year interest-free loan.

Housing

  • In addition to advancing India’s environmental goals, the plan to enable rooftop solarization in one crore households will provide free electricity to the average Indian household for up to 300 units.
  • FM is offering an opportunity to persons living in rented homes, slums, and illegal colonies to own or construct their own homes as part of a middle-class housing project.
  • The goal of the Pradhan Mantri Awas Yojana (Grameen) has almost reached 3 crore dwellings, plus an extra 2 crore over the following five years.

Agriculture

  • The government intends to encourage both public and private investment in post-harvest operations.
  • To make India self-sufficient, research sparked the growth and development of local oilseeds like sesame, mustard, and groundnut. At the moment, India spends more than 1.5 trillion a year importing over 60% of its cooking oil.
  • To attain Atma Nirbharta for oilseeds, the Atmanirbhar Oilseeds Abhiyan approach will be developed.
  • It is necessary to have a thorough plan for the development of dairy products.
  • Increased efforts will be made to increase farmers’ income. To decrease subsidies and imports of fertilizer, the government will promote the quicker adoption of nano-DAP.
  • To quadruple exports, increase employment possibilities, and improve aquaculture output, the Pradhan Mantri Matsya Sampada Yojana will be implemented more aggressively.

Healthcare

  • The Saksham Anganwadi and Poshan 2.0 program aims to promote early childhood care and development, nutrition delivery, and Anganwadi center upgradation as quickly as possible.
  • All ASHA, Anganwadi workers, and assistants would have expanded access to health care under the Ayushman Bharat initiative.
  • Girls between the ages of 9 and 14 are being actively encouraged by the government to get vaccinated against cervical cancer.
  • Mission Indradhanush plans to launch a U-WIN platform for immunization campaigns.
  • A committee will be established to research the challenges associated with establishing more medical institutions in India.

Tourism

  • States will be encouraged to build famous tourism destinations to draw tourists and promote local commercial prospects.
  • The goal is to support growth by giving states long-term, interest-free loans.
  • Initiatives about port accessibility, tourism facilities, and facilities will be implemented on islands, encompassing Lakshadweep.

Viksit Bharat Theme

The Viksit Bharat theme for this year’s budget saw the government envisioning a developed India by 2047. Viksit Bharat Budget 2024’s four pillars are “Annadata” (Farmers), “Mahilayen” (Women), “Yuva” (Youth), and “Garib” (Poor). Given the inclusive growth plan that prioritizes people, the Finance Minister declared:

  • The physical, digital, and social infrastructures will all see significant change.
  • Formalization and financial inclusion will be encouraged by digital public infrastructure or DPI.
  • Using the current infrastructure, further medical colleges will be established. All Anganwadi workers and assistants would be eligible for healthcare coverage under the Ayushman Bharat Scheme.
  • With the GST, the government intends to broaden and deepen the tax base.
  • Credit, investment, and savings all returned to normal as a result of a strengthened banking sector.
  • The establishment of GIFT IFSC, a strong gateway for international capital and financial services for the economy, is planned.
  • Proactive inflation control is planned.
  • The FM decided to maintain the current tax rates, including import duty, in the interim Budget 2024, which disappointed the taxpayers. However certain tax exemptions for specific IFSC units and startup-related perks that expire in March will be extended until March 2025.

Conclusion

Budget 2024 has a progressive viewpoint, prioritizing infrastructure development, implementing PM Gati Shakti’s ideas, and reducing back on logistics expenses. As a logistic player, we feel excited about how this will improve our operations and—above all—our customers’ experiences, creating a more lively and competitive market for all. The difficulties of more than ten years ago have faded into a distant nightmare; this has only been made possible by a persistent focus on the nation’s development while taking into account every disadvantaged segment of society. The advancement of the nation aligns with that of the impoverished, women, youth, and farmers, as the prime minister frequently states.

References:

Budget 2024 Updates: Nirmala Sitharaman prioritizes affordable housing, Green growth, boosts capex (Mint)

Budget 2024: It reflects political confidence to address challenges (The Indian Express)

© Ruchi Verma

Disclaimer: This article is not published as financial advice or any other financial legal issue. This post is written as an informational part, please read all guidelines carefully before investing in financial transactions. We recommend you consult your financial planner before investing in any financial decisions.

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Ruchi Verma

Certified parenting teen practitioner, multiple Award winner, mother of two active kids believes in sharing the right source of information to readers which could help them in every possible way!!

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