Voluntary scrapping policy announced, fitness test after 20 yrs for PVs
Govt proposes one nation, one ration card; Agri cess of Rs 2.5 per litre on petrol, Rs 4 on diesel; reduces timeline for filing belated, revised ITR by 3 months; proposes extension of tax holiday for start-ups by one more year; Higher FDI in insurance sector;
BY: Precious Kashmir Monitor
New Delhi: Finance Minister Nirmala Sitharaman on Monday presented the Budget 2021 aimed at reviving an economy badly hit by the coronavirus pandemic.
The country’s healthcare spending would be doubled to ₹ 2,23,846 crore and Rs 35,000 crore would be spent on Covid vaccines. Capital expenditure will be increased to ₹ 5.54 lakh crore, which is around 34 per cent higher than last year.
While there were no big tax announcements, the Finance Minister announced a reprieve for pensioners who are 75-plus, will no longer be required to file tax returns.
Sitharaman said the Budget was prepared in circumstances like never before and that the government was fully prepared to back and facilitate a reset of the economy.
She said the Budget 2021 proposals rest on six pillars. These are Health and Well-Being, Physical and Financial capital and infrastructure, Inclusive Development for Aspirational India, Reinvigorating Human Capital, Innovation and R&D, and Minimum Government, and Maximum Governance.
The FM proposed more than doubling the healthcare spending to ₹ 2.2 lakh crore. Out of this, an amount of ₹ 35,000 crore has been allocated for developing Covid-19 vaccines.
She expanded the National Infrastructure Pipeline to cover 7,400 projects by 2025. She also announced the creation of a development finance institution called the National Bank for Financing Infrastructure and Development, with a capital base of ₹ 20,000 crore and a lending target of ₹ 5 lakh crore over a 3-years time horizon
In an incentive to the farming community, the government announced an increase in agriculture credit target to ₹ 16.5 lakh crore in FY 2021-22.
The FM also gave an assurance that the procurement of produce by the government under the minimum support price (MSP) will continue at a steady pace.
The Foreign Direct Investment (FDI) in the insurance sector has been increased from 49 per cent to 74 per cent
In a big relief to citizens, the Finance Minister announced that the compliance burden will be reduced for citizens aged 75 years and above. Senior citizens with only one pension and interest scheme are exempted from filing income tax returns.
Sitharaman said the government will infuse ₹ 20,000 crore into public sector banks (PSBs) in 2021-22 in order to meet the regulatory norms. For the current financial year, the government had made a provision of ₹ 20,000 crore towards recapitalisation.
In order to incentivise the purchase of affordable house, the finance minister proposed to extend the period for claiming an additional deduction for the interest of ₹ 1.5 lakh paid for home loans by one year to March 31, 2022
Sitharaman announced special infrastructure projects for poll-bound states of Assam, West Bengal, Kerala and Tamil Nadu. A whooping 1.03 lakh crore has been set aside for Tamil Nadu; Kerala has been earmarked ₹ 65,000 crore and Assam has received ₹ 34,000 crore.
Sitharaman announced the Voluntary scrapping policy while giving her Budget 2021 speech. The scrapping scheme will be based on the mandatory fitness test of vehicles which will undergo fitness test in automated fitness centres. The timeline fixed for fitness test is 20 years for personal vehicles and 15 years for the commercial vehicles.
In the Voluntary vehicle scrapping policy, old and unfit vehicles will be phased out. In July last year, the Centre had proposed amendments to the motor vehicle rules to allow scrapping of vehicles older than 15 years. Further, in a draft notification, the government proposed renewal of fitness certificates for vehicles older than 15 years every six months instead of the current one year.
The policy is expected to encourage customers to go in for new purchases which will be backed up by government incentives in lieu of their old vehicles. Significantly, this move is considered to be the most vital element of any further package to prop-up the sector’s growth.
SItharaman announced a push to the textile industry, a central university in Leh, a focus on sea-weed farming with a new facility in Tamil Nadu and a new vehicle scrapping policy that aims to provide the auto sector with a boost among other announcements. She also announced that an additional 1 crore families will now benefit under the Centre’s Ujjwala scheme.
This was Sitharaman’s third budget under the National Democratic Alliance (NDA) government led by Prime Minister Narendra Modi. In a significant departure from the tradition, this year’s Budget will be unique as it will be paperless.
The FM announced “One Nation One Ration Card” for providing benefits to workers in unorganised sectors.
”One Nation One Ration Card plan is under implementation by 32 states and UTs, reaching about 69 crore beneficiaries – that’s a total of 86 per cent beneficiaries covered,” she said.
Last year, the labourers and migrants were hardest hit from Covid-19 crisis and nationwide lockdown due to hardships in getting rationed food and jobs. This in all forced many to leave cities and return to their villages.
This scheme allows beneficiaries to claim their rations from anywhere in the country, especially the migrant workers, with a partial claim from where they are stationed, while their family, in their native places, can claim the rest, the minister said.
Sitharaman also proposed to launch a portal that will collect relevant information on gig, building and construction-workers among others. This will also help formulate health, housing, skill, insurance, credit, and food schemes for migrant workers.
The government will implement the new labour codes for extending social security benefits to gig and platform workers with the application of minimum wages across all categories of workers.
Women will be allowed to work in all categories and also in the night-shifts with adequate protection, Sitharaman said.
The FM also announced that an agriculture Infrastructure and Development Cess (AIDC) of Rs 2.5 per litre has been imposed on petrol and Rs 4 per litre on diesel. This cess comes at a time when petrol and diesel prices are already skyrocketing. Despite the cess, overall there would be no additional burden on the consumer
The Budget has proposed to reduce the deadline for filing belated, revised income tax return (ITR) by three months from March 31 to December 31 of the Assessment year.
This means, for the current financial year (FY2020-21) the last date to voluntarily filing the ITR will be December 31, 2021. “Sub-sections (4) and (5) of section 139 of the Act contain provisions relating to the filing of belated and revised returns of income respectively. The belated or revised returns under sub-sections (4) and (5) respectively of the said section at present could be filed before the end of the assessment year or before the completion of the assessment whichever is earlier. With the massive technological upgrade in the Department where the processes under the Act are moving towards becoming faceless and jurisdiction-less, the time taken to conduct and complete such processes has greatly reduced.