The Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman made her maiden Budget Speech on July 5, 2019 and presented the Union Budget 2019-20 before the Parliament. The key highlights of Union Budget 2019 are as follows:

1. Direct Tax:

  • No change in personal income tax rates
  • Corporate tax rate reduced to 25% from 30% for companies with annual turnover up to Rs. 400 crore
  • Surcharge increased on individuals by:
    • 3% on income of Rs. 2 crore but less than Rs. 5 crore
    • 7% on income of Rs. 5 crore and more
  • TDS of 2% on cash withdrawal exceeding Rs. 1 crore in a year from a bank account
  • Interchangeability of PAN and Aadhaar. Those who don’t have PAN can file tax returns using Aadhaar. Aadhaar can be used wherever PAN is required.
  • Pre-filling of Income-tax Returns for faster, more accurate tax returns. Pre-filled tax returns with details of several incomes and deductions to be made available. Information to be collected from Banks, Stock exchanges, mutual funds etc.
  • Faceless e-assessment with no human interface to be launched. To be carried out initially in cases requiring verification of certain specified transactions or discrepancies.
  • Additional deduction up to Rs. 1.5 lakhs for interest paid on loans borrowed up to 31st March, 2020 for purchase of house valued up to Rs. 45 lakh. Overall benefit of around Rs. 7 lakh over loan period of 15 years.
  • Additional income tax deduction of Rs. 1.5 lakh on interest paid on electric vehicle loans. Customs duty exempted on certain parts of electric vehicles.
  • Higher tax threshold for launching prosecution for non-filing of returns.
  • Capital gains exemptions from sale of residential house for investment in start-ups extended till FY21.
  • ‘Angel tax’ issue resolved- start-ups and investors filing requisite declarations and providing information in their returns not to be subjected to any kind of scrutiny in respect of valuations of share premiums.
  • Funds raised by start-ups to not require scrutiny from Income Tax Department.
  • Interest on certain bad or doubtful debts by deposit taking as well as systemically important non-deposit taking NBFCs to be taxed in the year in which interest is actually received.
  • STT restricted only to the difference between settlement and strike price in case of exercise of options.
  • Appropriate class of persons exempted from the anti-abuse provisions of Section 50CA and Section 56 of the Income Tax Act.
  • India’s Ease of Doing Business ranking under the category of ‘paying taxes’ jumped from 172 in 2017 to 121 in the 2019.
  • Direct tax revenue increased by over 78% in past 5 years to Rs. 11.37 lakh crore
  • Tax Simplification and Ease of living - making compliance easier by leveraging technology.


2. Indirect Taxes:

  • Basic Customs Duty increased on cashew kernels, PVC, tiles, auto parts, marble slabs, optical fibre cable, CCTV camera etc.
  • Exemptions from Custom Duty on certain electronic items now manufactured in India withdrawn.
  • End use based exemptions on palm stearin, fatty oils withdrawn.
  • Exemptions to various kinds of papers withdrawn.
  • 5% Basic Custom Duty imposed on imported books.
  • Customs duty reduced on certain raw materials such as:
    • Inputs for artificial kidney and disposable sterilised dialyser and fuels for nuclear power plants etc.
    • Capital goods required for manufacture of specified electronic goods.
  • Defence equipment not manufactured in India exempted from basic customs duty
  • Export duty rationalised on raw and semi-finished leather
  • Increase in Special Additional Excise Duty and Road and Infrastructure Cess each by Rs. 1 per litre on petrol and diesel
  • Custom duty on gold and other precious metals increased
  • Legacy Dispute Resolution Scheme for quick closure of pending litigations in Central Excise and Service tax from pre-GST regime


3. Miscellaneous:

  • Inter-operable transport card runs on RuPay card and would allow the holders to pay for bus travel, toll taxes, parking charges, retail shopping.
  • Business establishments with annual turnover more than Rs. 50 crore shall offer low cost digital modes of payment to their customers and no charges or Merchant Discount Rate shall be imposed on customers as well as merchants.
  • Indian economy to become a 3 trillion dollar economy in the current year. 1 trillion dollar added to Indian economy over last 5 years (compared to over 55 years taken to reach the first trillion dollar).
  • India is now the 6th largest economy in the world, compared to 11th largest five years ago.
  • Indian economy is globally the 3rd largest in Purchasing Power Parity (PPP) terms.
  • Payment platform for MSMEs to be created to enable filing of bills and payment thereof, to eliminate delays in government payments.
  • India’s first indigenously developed payment ecosystem for transport, based on National Common Mobility Card (NCMC) standards, launched in March 2019.
  • Almost 1 crore citizens have downloaded Swachhata App.
  • Overdraft of Rs. 5,000 to be allowed for every verified women SHG member having a Jan Dhan Bank Account.
  • One woman per SHG to be eligible for a loan up to Rs. 1 lakh under MUDRA Scheme.
  • Proposal to consider issuing Aadhaar Card for NRIs with Indian Passports on their arrival without waiting for 180 days.
  • NPAs of commercial banks reduced by over Rs. 1 lakh crore over the last year.
  • PSBs to leverage technology, offering online personal loans and doorstep banking, and enabling customers of one PSBs to access services across all PSBs.


(Also read: Clarification regarding GST Annual Returns and Reconciliation Statement)

(Also read: GST Revenue collection for June, 2019)

(Also read: Indian Railways releases its new All India Railway Time Table)

(Also read: Government reduces the rate of ESI contribution from 6.5% to 4%)

(Also read: National Common Mobility Card)

(Also read: NEFT and RTGS charges will be waived from 1 July 2019)

(Also read: Signature of parents on CBSE Class X Marksheet cum Certificate for declaration of correct information)



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