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Applicable Syllabus for CA Exams May 2020

Budget | FY 2020-21 | LIVE UPDATES

All updates of Budget FY 2020-21 are provided here within the speech of Honorable Finance Minister Smt. Nirmala Sitharaman at Lok Sabha today:

Union Budget 2020-21 Latest Updates: Track this  blog for the latest developments through the day

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Part B: 

Indirect Taxes

  • Health cess on import of medical equipment
  • Custom duty raised on footwear and furniture
  • GST reforms will continue including a simplified return-filling form. Refund has been simplified and has been fully automated, says Nirmala Sitharaman. Aadhaar-based taxpayer verification will be done.

Direct Taxes
  • Tax on Cooperative societies proposed to be reduced to 22 per cent plus surcharge and cess, as against 30 per cent at present
  • In a boost to MSMEs, turnover threshold for audit raised to Rs 5 crore from Rs 1 crore
  • Concessional tax rate of 15% extended to power generation companies
  • A total of 4.83 direct tax cases pending in various forums. So a new direct tax dispute settlement under 'Vivad se Vishwaas Scheme'. No penalty will be charged if taxpayers pay by March 31, 2020.Here, only disputed tax amount has to be paid.
  • Will amend I-T Act to enable faceless appeals on the lines of faceless assessments.
  • The government plans to increase investment limit of foreign portfolio investors (FPI) in corporate bonds from 9 per cent to 15 per cent, Finance Minister Nirmala Sitharaman said on Saturday. In her second Budget presentation, the finance minister said certain government securities will be open for foreign investors. She also proposed debt-exchange traded funds comprising mainly government securities, while stating that Rs 22,000 crore has already provided as support to infrastructure project pipeline. To address liquidity constraints of NBFCs and housing finance corporations, partial credit guarantee scheme will be launched by the government
  • To ease deduction donation it is proposed to pre-fill information of those donating. This will result in hassle free claims for the individuals claiming tax exemptions.
  • Affordable housing, the deduction of Rs 1,50,000 will be extended to loan sanction by one year. Tax holiday on profits of developers involved in affordable housing projects will be extended by one year to March 2021.
  • Corporate tax cut will be available for power generation companies as well. Government will grant exemptions for sovereign wealth funds in infrastructure and other notified sector with minimum lock-in of three years. The rate of withholding tax has been extended to 2023 for FPIs.
  • Concessional 5% withholding tax has been extended to municipal bonds. Cooperatives are taxed at 30 percent now. FM says cooperatives can choose a 22 percent tax with 10 percent surcharge and 4 percent cess with no exemptions.
  • Rs 40,000 crore per annum will be revenue foregone from new income tax rates for individuals
  • Companies will no longer be required to pay DDT. A total of Rs 25,000 crore is revenue foregone due to DDT abolition, says FM. This will make India an attractive investment destination.
  • Currently, more than 100 exemptions provided in I-T Act. Now around 70 of them have been removed in the simplified regime. Remaining will be reviewed over the coming years to simplify the system
  • There will be a significant reduction in tax payed even by those having Rs 15 lakh. But the new tax regime will be optional. A total of Rs 40,000 crore a year will be revenue foregone per year, says FM.
  • DDT is gone! Big Budget move for stock markets
  • Tax Rate 10% for Income between 5 to 7.5 Lakh 15% for Income between 7.5 to 10 Lakh 20% for Income between 10 to 12.5 Lakh 25% for Income between 12.50 to 15 Lakh Above 15 Lakh 30% No Tax deduction / Exemption will be allowed & IT IS OPTIONAL TO CHOOSE THIS NEW SLAB
  • SLAB RATES CHANGED FOR INDIVIDUALS: Tax of only 10 percent will be charged to Rs 5 lakh-7.5 lakh income as against prevailing 20 percent rate. From Rs 7.5 lakh-10 lakh income, a tax rate of 15 percent against 20 percent prevailing rate. For income Rs 10-12.5 lakh, a rate of 20 percent as against 30 percent earlier. For income between Rs 12.5 lakh-15 lakh will be taxed at 25 percent as against 30 percent. For those at Rs 15 lakh plus income, tax will be 30 percent.
  • loss of substantial revenue in short term due to corporate tax rate cut. 


Part A

Theme 3: Caring Society
  • Our govt has spearheaded radical fiscal measures to ensure high growth
  • FY20 fiscal deficit seen at 3.8% of GDP
  • FY21 fiscal deficit target at 3.5% of GDP
  • Govt to amend Banking Regulation Act to strengthen co-op banks
  • There has been a debate on projected fiscal numbers. Procedure adopted is compliant with FRBM Act, assures FM. She says repayment of these debts as hitherto are done of Consolidated Fund of India
  • Govt to sell part of its stake in LIC. Government to list LIC on the stock exchanges. Big news on Life Insurance Corporation of India which is the largest institutional investor.
  • IFSC has a potential to become a centre of finance. It has 19 insurance entities already and GIFT City will now set up an international bullion exchange. This will enable India to enhance its position, create more jobs and better price discovery of gold
  • Financial markets, deepening the bond market is key. She says that some government securities will be open for non-resident investors. To improve investor confidence, a legislation on laying down mechanism for netting of financial contracts will be done. A debt ETF consisting of government securities will be launched. For NBFCs and HFCs, liqduity constraints will be addressed. The FPI Limit in corporate bonds will be raised to 15% from 9%.
  • Certain debt products to be fully open to NRIs, apart from being available to resident investors
  • Subordinate debt for entrepreneurs of MSMEs will be provided and will be treated as quasi-equity, says FM. More than 5 lakh MSME benefited from debt restructuring last year. Government has asked RBI to consider extending window of debt structuring by one year to March 2021 for this purpose. 
  • App-based invoice financing plan to be introduced
  • Measures to boost MSME: Amendments to Factor Regulation Act to help MSMEs to raise invoice financing, says FM
  • PFRDA Act will be amended to separate NPS Trust of government employees from PFRDA.
  • Deposit insurance cover increased to Rs 5 lakh, Depositors money in schedule commercial banks absolutely. Insurance cover on deposists by DICGC to be hiked to Rs 500,000 lakh from Rs 100,000.
  • A clean, reliable and robust financial sector is critical for robust economy, she says. Infused Rs 3.5 crore capital into PSU banks. A few among them will be encouraged to move capital market for fund raising purposes, said FM. She added that deposit insurance cover will be hiked to Rs 5 lakh from Rs 1 lakh. She reiterated that all deposits are safe.
  • India will host G-20 residency in 2022 during 75th year of India's independence. During this event, India would be drive global economic advantage and an allocation of Rs 100 crore has been done for this purpose.
  • Stable and predictable business environment is key for government. Contracts Act will be strengthened to ensure that all contracts are honoured
  • India has a firm framework related to contracts act, we aim to strengthen it
  • Govt to set up National Recruitment Agency for recruitment of non-gazetted posts
  • Governance and financial inclusion is needed. Governance should be clean and corruption free, she says. Trusting every citizen including aspirational youth, farmers, senior citizens and hard-working women is key
  • A tax payers statutes will be established for protection of taxpayers
  • National security is our priority
  • 5 archaeological sites to be developed
  • Govt proposes to encourage and incentivise states that are formulating plans for ensuring cleaner air: In large cities with population of over 1 million, clean air is a matter of concern
  • Wealth creators will be respected in this country
  • Rs 4,400 crore allocation for clean air


Theme 2: Economic Development
  • Ayushman Bharat hospitals in 100 more districts
  • Finance Minister Nirmala Sitharaman says gross enrollment of girls under Beti Bachao Beti Padhao is higher than boys. Here, she says that gross enrollment of girls is 94.32 percent in elementary levels, 81.32 per cent in secondary level and 59.7 per cent in higher secondary level.
  • Five archaeological sites will be set up with museums on site in Rakhi Gadi in Haryana, Hastinapur in UP, Dholavira in Gujarat, Shivsagar in Assam and Adichanallur in Tamil Nadu. A tribal museum will be set up in Ranchi, Jharkhand. Maritime site will be set up in Lothal. A total of Rs 3,100 crore has been set aside for Culture Ministry in FY21. A 100 more airports will be developed under UDAN by 2024. A total of Rs 2,500 crore will be allocated for tourism promotion in FY21.
  • Rs 9,000 crore for senior citizens
  • Rs 53,700 crore for development and welfare of Scheduled Tribes
  • Have identified suitable technology to eliminate manual cleaning of sewer systems and septic tanks
  • Rs 35,000 crore for nutrition-related programmes
  • For SC/OBC relief, a proposal of Rs 85,000 crore for FY21. For STs, Rs 53,700 crore will be provided. 
  • Gross enrollment of girls under Beti Bachao Beti Padhao is higher than boys. Here, she says that gross enrollment of girls is 94.32 percent in elementary levels, 81.32 percent in secondary level and 59.7 prercent in higher secondary level. She adds that women are a priority especially pregnant women and lactating women. More than 6 lakh anganwadi workers are equipped to upload status of more than 10 crore households This scale is unprecedented. Overall, FM says there are imperatives to lower maternal mortality rates. FM proposes task-force on six months on this matter. An allocation of Rs 35,600 crore for nutrion-related programmes in FY21. Further, Rs 28,600 crore will be allocated in FY21 by government for women-linked programmes.
  • Rs 8,000 crore outlay over 5 years for National Mission of Quantum Technology and Application
  • 100,000 gram panchayats will be connected to the optical fibre programme
  • Air traffic: 100 more airports by 2024
  • Govt proposes a task force to review women's minimum age for marriage
  • An allocation of Rs 8,000 crore has been set up for the National Mission on Quantum Computing and Technology
  • Mapping of genetic landscape is critical for India, says FM. Two national level science schemes to be set up for getting a comprehensive national-level database
  • India has embraced sharing economy with aggregators displacing regular businesses. Analytics, IoT and AI are changing the world. A policy will bve set up to build data centre parks throughout the country. All public institutions at Gram Panchayat levels will be provided with digital connectivity. Fibre to home through BharatNet will link 100,000 Gram Panchayats in FY21 itself. An allocation of Rs 6,000 crore will be provided for BharatNet.
  • A new scheme of smart meters will be launched. Here, the prepaid meters will give freedom to give consumers to choose suuplier and rate as per their requirement, says FM. A total allocation of Rs 22,000 crore will be given to power and renewable sector
  • More TejasExpress -type trains will be set up for tourist destinations, says FM. A governance framework for ports will be set up. It will also look at one major port and its listing on the stock exchanges, says FM. Government will provide 20% equity for Bengaluru Suburban Transportation Project. This will be a Rs 18,600 crore project. An allocation of Rs 1.7 lakh crore for trasport infrastructure will be provided in FY21
  • A total of 12 lots of highway bundles will be monetised by 2024
  • Digital refund of state and central taxes to exporters announced. The key is for the execution to be glitch free. 
  • National Infrastructure Pipeline involves 6,500 projects. NSDC will help skill development in the infrastructure sector. Making MSMEs competitive will be our goal. A total of 9,000 km of economic corridor will be set up, says FM. Chennai-Bengaluru expressway will also be started, says FM. Delhi-Mumbai Expressway To Be Completed By 2023
  • allocation of Rs 27,300 crore for industry and commerce In FY21 
  • A new scheme Nirvik will be offered for exporters. This will have lower premiums and a faster claims settlement. Refund to exporters the duties levied including electricity and VAT which have been not refunded. This will be launched this year itself, says FM. Each district will have to be developed as an export hub. The governments e-marketplace has a lot of opportunities for SMEs. A total allocation of Rs 27,300 crore for development of industry and commerce in FY21
  • there is cost advantage for electronics manufacturing in India. But she says that this needs more investment. FM proposes a scheme on encourage manufacturing of mobile phones, semi conductor packaging and electronic equipment, She said that this can be used for manufacture of medical devices as well. A detailed scheme with details will be released soon.
  • India for a millennium has been rich in skills in mettalurgy and trading. FM says entrepreneurship is the spirit of India ad has been its strength. Indians have given up greener pastures to come back to India and look at local challenges, she added. Will creare more opportunities for startup owners. Investment clearance cell will be set up for entrepreneurs
  • National Logistics Policy will be revealed soon. It will focus on making MSMEs more competitive
  • Rs 1,480 cr for National Textile Mission: National Textile Mission proposed with a Rs 1,480 cr allocation


Theme 1: Aspirational India


  • With the largest working population, govt takes steps to ensure education for all
  • Govt propose National Police University and National Forensic University
  • FM announces Rs 99,300 crore outlay for education sector in 2020-21 and Rs 3,000 crore for skill development
  • There is a huge demand for teachers, nurses, paramedical staff and care givers abroad. However, their skill-sets do not match standards and needs to be improved
  • IND-SAT test proposed for foreign students wishing to pursue higher education in India
  • Degree-level online education programmes to be launched by select institutes
  • Govt to expand Mission Indradhanush, add hospitals to Ayushman Bharat
  • Degrees can be taken online soon and will be offered by the Top 100 NIRF ranked institutes, says Nirmala Sitharaman. INDSAT exam will be held in Asian and African for scholarships to Study in India. Police Academy and Forensic Sciences will be set up
  • Dialogues have been with states about education policy of NEP. She added that NEP will be announced soon. Education sector needs greater finance to attract good teachers, she said. ECBs and FDI will looked for education sector. A total of 150 higher education institutes will have apparenticeship programmes by March 2021. Urban local bodies will provide fresh engineers a job opportunity for one year
  • 150 higher institutes to start apprentice training for general category students
  • New education policy soon: By 2030, India will have largest working-age population. We'll have a new education policy soon, says Sitharaman.
  • Government allocates Rs 12,300 cr for Swachh Bharat
  • Indian Railways to set up a ‘Kisan Rail’ through Public-Private Partnership
  • Rs 3.6 lakh crore for Jal Jeevan Mission has been approved. This will look at augmenting local water ressouces, desalination, water harvesting and renewing older sources in FY21
  • FM says the TB Harega, Desh Jeetega campaign will be strengthened to end TB by 2025 in the country. A total of Rs 69.000 crore has been provided for the healthcare sector of which PM Jan Arogya Yojana will get Rs 6,400 crore.
  • Framework for development, management and conservation of marine fishery
  • There is a holistic vision of healthcare. Mission Indradhanush has been extended to cover new diseases and new vaccines. Fit India is part of it, she said. There are 20,000 empanelled hospitals in Ayushman Bharat and need more in Tier 2 and 3 cities to benefit poor in these areas. PPP mode hospitals will be set up under viability gap funding to look at areas where there are no hospitals. This will be 112 aspitational districts where first priority will be given
  • A boost for warehouses: Warehouses will be set up, viability gap funding to be provided to set up warehouses
  • Govt plans to boost horticulture
  • Horticulture projects at the district level will be given importance. Online portal on Jaivik Kheti will be strengthened
  • Agriculture Credit Target set at 15 trillion for the next fiscal
  • Fish production to be raised to 20 mn tonnes
  • 377 sagar mitras and 500 fish farmer organisations to help youth work in fish farming sector
  • We will encourage balanced use of all fertilizers, a necessary step to change the incentive regime which encourages excessive use of chemical fertilizers
  • Govt to build up the seamless national cold supply chain for perishables
  • To build a seamless national cold supply chain for perishables, Indian Railways will set up Kisan Rail through PPP model so that perishable goods can be transported quickly. Krishi Udaan will be launched by MoCA on international and national routes
  • 61.1 million farmers insured under Fasal Bima: Sitharaman
  • A total of 61.1 million farmers insured under Fasal Bima, says Sitharaman. She says hand-holding of farm-based activities needs to be done in cooperation with states
  • NBFCs and cooperatives are active in agriculture. NABARD refinance scheme will be expanded, says FM. There will be Rs 15 lakh crore agriculture credit availability
  • PM Kusum Scheme reduced dependence on diesel and kerosene and relied on social energy. Total of 2 million farmers can set up standalone solar pumps, she says. Further, she said that government can help 1.5 million solarise grid-connected pump sets, says finance minister Nirmala Sitharaman. Farmers can also use barren land for solar energy and have a livelihood out of it
  • Govt proposes plans to help farmers use proper manure and little water
  • Modi govt commits to double farmer income by 2022
  • In the first theme of Aspirational India, Sitharaman is focussing on skills, education, and agriculture. 'The government is committed to double the farmer income by 2022. Farmers with barren land can set up solar power units so that they can get a living out of it,' she said, presenting a 16-point action plan for this purpose
  • FM Nirmala Sitharaman quotes Atichudi of Saint Avaiyar and says that farm land should have sufficient manure and water and not an excessive one. Will also revise incentives for use of chemical fertilisers, says FM. Warehouse building incentives will also be given by the government for the farmers. The thrust, she says, is to offer viability gap funding and Mudra loans will also be provided for such self-help groups. Here, women will be the 'dhanya Laxmi' in the villages, she added.
  • FM's action plan to ease India's water problems starts with helping 100 districts
  • Budget proposes ‘comprehensive measures’ for 100 water-stressed districts across India
  • Our government is committed to doubling farmers income by 2022: FM Sitharaman
  • Our government is committed to doubling farmers income by 2022. We have provided for 110 million farmers through PM Kisan Beema Yojana. Provision of annual assistance to the farmer is made sure through PM Kisan yojana. Agricultural markets needs to be opened and liberalised. Fisheries, animal husbandry and dairy needs to be provided for: Finance Minister Nirmala Sitharaman.
  • Aspirational theme covers agricuture, irrigation rural develepment, Committed to doubling farmers income by 2022. Financial inclusion has raised farmers' income.
FM's Key Points

  • We shall strive to bring ease of living to every citizen
  • FM Nirmala Sitharaman recites a verse in Kashmiri
  • Humaara watan, kheltey huey shalimaar baag jaisa, humaaara watan dal lake mein khiltey huey kamal jaisa, Navvjawaanon key garam khoon jaisa, Mera Watan, Tera Watan, Humaara Watan, Duniya ka Sabsey Pyaara Watan
  • Efforts we have made in the last five years and the enthusiasm and energy of our youth are the ignition of our growth: FM
  • Finance Minister Nirmala Sitharaman said the dreaded 'inspector Raj' had vanished, thanks to her government’s reforms to help businesses
  • Central govt's debt has come down to 48.7% in March 2019 from 52.2% in March 2014
  • Simplified return for GST is being introduced from April 2020
  • 3 factors of Budget 2020: Aspirational India, Economic development, Caring society - Aspirational India in which all sections of the society seek better standard of living, Economic development for all, Ours shall be a caring society: Caring and compassionate
  • GST has integrated the country economically
  • GST benefit of Rs 1 lk cr has been extended to consumers 
  • A pill for your GST headache: A new and simplified GST return system coming this April
  • Between 2006-2016 India was able to raise 217 million people out of poverty
  • An average household now saves about 4% of its monthly spend on account of reduced GST
  • FM Nirmala Sitharaman says in May 2019 PM Narendra Modi received a massive mandate to form the government again. WiIl serve with humility and dedication, says the FM.
  • For every member of the schedule caste and schedule tribe, for every woman, for every individual from minority section of the society, this budget aims to give wings to your aspirations, says FM

Compiled & Presented By:

Gourav Kapoor
 Founder
 CA Passion






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