Interim Budget 2019 is being considered bliss for individuals belonging to the middle class (those with an annual income of approximately Rs. 12 lakhs) and farmers. Budget 2019 paved the way for a reduction in tax slabs, Tax Deducted at Source (TDS) and Standard Deduction (SD.)
On the 1st of February 2019, the Government of India introduced the last budget for the year 2019, before the Lok Sabha elections take place.
The new budget of 2019 gives a breath of relief to taxpayers and farmers. According to the Budget, anyone with an annual income less than Rs. 5 lakhs will be free from paying taxes.
Piyush Goyal, the Railway Minister of India, also announced a rise of Rs. 10,000 in SD for salaried persons. Previously, the SD was Rs. 40,000, but following the rise, the SD will be Rs. 50,000.
Speaking about the new Budget, Piyush Goyal said, “Even persons having gross income up to Rs 6.5 lakh may not be required to pay any income tax if they make investments in provident funds, specified savings and insurance.” He further added, “In fact, with additional deductions such as interest on home loan up to Rs 2 lakh, interest on education loans, National Pension Scheme contributions, medical insurance, medical expenditure on senior citizens, persons having even higher income will not have to pay any tax.”
According to Arun Jaitley, the Finance Minister of India, the Interim Budget will provide relief to approximately 3 crore middle class taxpayers by exempting them from paying taxes. He said, “Around 3 crore middle class taxpayers will get tax exemption due to this measure.”
The major highlights of Interim Budget 2019 are:
Tax:
1. Within 2 years, tax assessment will be done electronically.
2. IT returns processing in just 24 hours.
3. Minimum 14 % revenue of GST to States by Central Govt.
4. Custom duty abolished on 36 Capital Goods.
5. Recommendations to GST Council for reducing GST rates for home buyers.
6. Full tax rebate for individuals earning Rs. 5 lakhs as their annual income, after all the deductions.
7. Standard deduction increased from Rs. 40,000 to Rs. 50,000.
8. Tax exemption on second self occupied house.
9. Ceiling Limit of TDS u/s 194A increased from Rs. 10,000 to Rs. 40,000.
10. Ceiling Limit of TDS u/s 194I increased from Rs. 1,80,000 to Rs. 2,40,000.
11. Capital tax Benefit u/s 54 increased from investment in one residential house to two residential houses.
12. Benefit u/s 80IB increased to one more year, i.e., 2020.
13. Benefit given to unsold inventory increased from one year to two years.
Other areas:
14. State share increased to 42 %.
15. PCA restriction abolished for 3 major banks.
16. 2 lakh seats will increase to accommodate the provisions of the 10 % reservation bill.
17. Rs. 60,000 crores for the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA.)
18. Rs. 1.7 lakh crores to ensure food for all.
19. 22nd AIIMS has to be opened in Haryana.
20. Approval has to be given to PM Kisan Yojana.
21. Rs. 6,000 per annum has to be given to every farmer having up to 2 hectares land. The amount will be transferred in 3 installments.
22. National Kamdhenu Ayog for cows. Rs. 750 crores for National Gokul Mission.
23. 2 % interest subvention for farmers pursuing animal husbandry and creating a separate department for fisheries.
24. 2 % interest subvention for farmers affected by natural calamities and an additional 3 % interest subvention for timely payment.
25. Tax free Gratuity Limit increased to Rs. 20 lakhs from Rs. 10 lakhs.
26. Bonus will be applicable for workers earning Rs. 21,000 monthly.
27. The scheme called Pradhan Mantri Shram Yogi Mandhan will provide an assured monthly pension of Rs. 3,000 with a contribution of Rs. 100 per month for workers in unorganized sector after 60 years of age.
28. The Government will deliver 6 crores free LPG connections under the Ujjwala scheme.
29. 2 % interest relief for MSME GST registered persons.
30. 26 weeks of Maternity Leaves to empower women.
31. More than 3 lakh crores for defence.
32. One lakh digital villages in the next 5 years.
33. Single window approval for Indian filmmakers.
However, the opposition party, the Indian National Congress (INC,) claimed, Interim Budget 2019 is the final ‘jumla’ of the ruling party, the Bharatiya Janata Party (BJP.)
Mallikarjun Kharge, a senior leader of the INC, said, “They’ll (the BJP) try to introduce populist schemes in the Budget keeping an eye on Lok Sabha polls. Budgets they’ve presented so far haven’t really benefited general public. Only ‘Jumlas’ will come out today. They’ve only 4 months when will they implement the schemes?”
The opposition parties consider Interim Budget 2019 a campaign stunt by the BJP ahead of the upcoming Lok Sabha elections, scheduled between April and May 2019.
