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Union Budget 2019 LATEST Updates: At a press conference, former finance minister P Chidambaram claimed that the Union Budget was “bereft of any reforms”. “The most disappointed person must be the chief economic adviser. The only investment-related proposal was the to increase the FPI percent. The Modi government treats India as one big state government. Apparently the prime minister believe that only his government can deliver basic public goods and services. It is not good to reduce state government to local administrations,” he said. Congress communications in-charge Randeep Surjewala lashed out at the Centre on Twitter and called Budget 2019 a “‘betrayal’ of India’s youth”. He also claimed that the “real fiscal deficit” is estimated at 4.7 percent, and not 3.3 percent, as said by Nirmala Sitharaman. “Expenses on rural development, infrastructure, food subsidy were not included as part of Fiscal Deficit. The real fiscal deficit is estimated at 4.7 percent. Skulduggery of figures?” he wrote. The market plummeted soon after the trends of the Union Budget became apparent. Sensex dropped down by almost 250 points, while Nifty neared 11,826 points. Nirmala Sitharaman said, “A lower rate of 25 percent is currently applicable to companies having an annual turnover of upto Rs 250 crores. I propose to include all companies having an annual income of over Rs 400 crore.” She added that this will bring in 99.3 percent of all companies into the tax net and leave out only 0.4 percent companies Nirmala Sitharaman thanked taxpayers who as responsible citizens for their valuable contribution through taxes for all-round development of the country The government proposes to consider issuing Aadhaar cards to NRIs with Indian passports in India without having to wait for the necessary 180 days, she says Finance Minister Nirmala Sitharaman said that although zero budget farming is not a new thing, she would like to shift focus on going back to the roots and reassess the implementation of zero budget farming. She also said that ten thousand new farmer producer organisations (FPOs) will come up for ensuring market reach for farmers India is quite capable to achieve its goal of becoming $5 trillion economy in next few years, Nirmala Sitharaman said adding that India has already become the sixth largest economy of the world. She said that as of now, India is only third, after US and China, as far as purchase capacity is concerned. Finance Minister Nirmala Sitharaman rises to present her maiden Budget Speech. Petrol and diesel prices remain unchanged across the country for the third successive day on Friday. In Delhi, a litre of petrol today costs Rs 70.51 while diesel costs Rs 64.33 per litre, no change compared with Thursday’s price. As the first woman finance minister in 45 years Nirmala Sitharaman has traded in the iconic “budget briefcase” for a budget bahi khata. Traditionally, the finance minister arrives at the Parliament with a briefcase, which contains the budget document. However, in 2019, Sitharaman arrived with the budget document wrapped in a red cloth. Chief Economic Advisor Krishnamurthy Subramanian said, “It is in Indian tradition. It symbolises our departure from slavery of Western thought. It is not a budget but a bahi khata (ledger)”. In a departure from the norm, Nirmala Sitharaman is seen carrying a red bag with the Budget instead of a briefcase. Finance Minister Nirmala Sitharaman has handed over a copy of the Union Budget to the President. Finance Minister Nirmala Sitharaman has reached her office at the Finance Ministry. She will deliver the keenly watched Budget statement at 11 am in Lok Sabha A mini-stimulus to take the economy out of five-year low alongside giving some tax relief to common man may be on the cards, as Finance Minister Nirmala Sitharaman does a tightrope walk balancing the needs of the economy and fiscal constraints in her maiden Budget. When India’s first full-time Finance Minister Nirmala Sitharaman presents her maiden Union Budget 2019 on Friday at 11 am in the Parliament, she will also be facing huge challenges ahead with the country staring at the worst unemployment crisis in the past 45 years. The Finance Minister will also be under pressure to spend more to revive the slowing economy while finding out resources for welfare schemes. Sitharaman will begin her Budget speech at 11 am. Doordarshan will live telecast Budget 2019 and it will also be available on the Youtube channel. [caption id=“attachment_6738991” align=“alignleft” width=“380”] File image of Finance Minister Nirmala Sitharaman. Reuters.[/caption] This is the first Budget to be presented under the Narendra Modi 2.0 government after it was re-elected to power following the 2019 Lok Sabha elections. Sitharaman, who earlier held the portfolios of commerce and defence ministries in the previous Modi government, will have to find resources for welfare schemes declared by the Narendra Modi government, including Rs 87,000 crore ($12.6 billion) for a new measure to support farmers. Above all, she will have to do all this while keeping the fiscal deficit below 3.4 percent of Gross Domestic Product (GDP). The Economic Survey 2019 will be tabled today (Thursday), a day before the Union Budget is presented in the Parliament. The Economic Survey has been prepared by the new Chief Economic Advisor Krishnamurthy Subramanian and is slated to be presented around noon to both the Houses of the Parliament. The Economic Survey can be downloaded in the PDF format through this link: http://mofapp.nic.in:8080/economicsurvey/. It will be uploaded once it is presented. Follow full coverage of Union Budget 2019-20 here Click here to watch live coverage of budget
Highlights of Budget 2019: Chidambaram claims Budget 'bereft of any reforms', says chief economic adviser must be most disappointed
Budget 2019 LIVE Updates: At a press conference, former finance minister P Chidambaram claimed that the Union Budget was “bereft of any reforms”. “The most disappointed person must be the chief economic adviser. The only investment-related proposal was the to increase the FPI percent. The Modi government treats India as one big state government. Apparently the prime minister believe that only his government can deliver basic public goods and services. It is not good to reduce state government to local administrations,” he said.
 "Highlights of Budget 2019: Chidambaram claims Budget 'bereft of any reforms', says chief economic adviser must be most disappointed")
Piyush Goyal claims Budget has given huge thrust to startup, job creation, Make in India
Claiming that the Budget was meant was all, Union minister Piyush Goyal said, “It (Budget) has given a huge thrust to startup, job creation, and Make in India. It has given pension to the traders, large part of the community that was left out of the social security network. It’s very reform-oriented. So it’s a budget for 130 crore Indians.”
Union Minister Piyush Goyal on #Budget2019: It's a budget for all. It has addressed issues which will make 'ease of living' for the poor, the middle class. It has ensured large scale infrastructure development which have made life & living easy for 130 crore Indians, rich or poor pic.twitter.com/LrbqWYixvV
— ANI (@ANI) July 5, 2019
Chidambaram claims Budget ‘bereft of any reforms’
At a press conference, former finance minister P Chidambaram claimed that the Union Budget was “bereft of any reforms”. “The most disappointed person must be the chief economic adviser. The only investment-related proposal was the to increase the FPI percent. The Modi government treats India as one big state government. Apparently, the prime minister believes that only his government can deliver basic public goods and services. It is not good to reduce state government to local administrations,” he said.
Ease of living has to be given importance: Sitharaman on Budget
In interview with DD News, Nirmala Sitharaman said, “Ease of living has to be given importance. For that connectivity, tax structure have to be worked upon. All this will in turn will bring in investment.” She further called behavioural economics “a catalyst for transformational change” for countries like India in context of implementing policies.
Women seeing this govt committed to programmes for them, says Sitharaman
Speaking to DD News, Defence Minister Nirmala Sitharaman said, “Women are seeing that this government is committed to programmes for them. They came out in large numbers to vote irrespective of religion, caste or social status. This made us think to make a policy which is not women-centric but also progressive for women.”
Budget a betrayal of India’s youth: Surjewala
Congress communications in-charge Randeep Surjewala lashed out at the Centre on Twitter and called Budget 2019 a “‘betrayal’ of India’s youth”.
He also claimed that the “real fiscal deficit” is estimated at 4.7 percent, and not 3.3 percent, as said by Nirmala Sitharaman. “Expenses on rural development, infrastructure, food subsidy were not included as part of Fiscal Deficit. The real fiscal deficit is estimated at 4.7 percent. Skulduggery of figures?” he wrote.
#Budget2019
— Randeep Singh Surjewala (@rssurjewala) July 5, 2019
‘Betrayal’ of India’s Youth!
1. Not a word on Unemployment.
2. Not a word on New Opportunities.
3. Not a word on Public Education.
4. Not a word on High Fee Structure.
Centre allocates Rs 1,12,079.57 crore for defence pensions
The government allocated Rs 1,12,079.57 crore for defence pensions. Along with the defence budget, the total defence allocation comes to around Rs. 431,010.79 crore and accounts for 15.47 percent of the total Central government expenditure for coming fiscal.
FirstCut by Manjul
Govt expects to earn Rs 12,000 cr from hike in surcharge for high income groups
The Indian government expects to earn around Rs 12,000 crore from the hike in surcharge for the high income group. A surcharge will be levied on individuals with taxable income of Rs 2 to 5 crore, and Rs 5 cr and above. The effective tax rate for these categories will increase by around 3 percentage points and 7 percentage points, respectively.
Govt to suffer 4000 cr loss after corporate tax slash
In repsonse to a question during finance ministry’s Budget press conference, finance chief secretary said that bringing 99.3 percent companies under the lower 25 percent tax net will mean a loss of roughly Rs 4,000 crore.
Govt to provide credit guarantee to PSBs to buy NBFC assets
Non-banking financial companies (NBFCs) play an important role in capital formation and the government will provide a one-time partial credit guarantee to PSBs to buy high-rated pooled assets of financially sound NBFCs, Finance Minister Nirmala Sitharaman said in the Union Budget 2019-20 on Friday.
Elaborating further on the government’s approach, Sitharaman said, “The whole approach is to ensure that the government has responded comprehensively to the NBFC issue and if we had done that without understanding the regulatory shortcomings then it would not have done justice This is why some powers have been passed on to the RBI. Likewise, the recapitalisation is going to help banks fund their credit expansion.”
Budget 2019 takes into account comprehensive development of rural-urban economy: Sitharaman
“In Budget 2019, the emphasis is on overall development of both rural-urban economy. The emphasis this time is on environment has been laid, with focus on issues such as conversion of waste to energy,” SItharaman said.
Nirmala Sitharaman elaborates on LS speech, says Budget presented with a 10-yr vision
Nirmala SItharaman is addressing a press conference to elaborate on her Budget statement. “The Budget’s aim was to lay out the 5-year target, 10-year vision and various ways in which we can achieve it through measures for rural and urban, youth, among other things,” she said,
Union Budget for rural India?
The budget assures pukka house and an LPG connection to every household by 2022, while it also vows to encourage women’s contribution to the rural economy. Here are key pointers related to the rural economy at a glance.
1,174 listed cos need to off-load promoter stake to meet budget proposal norm
As many as 1,174 listed firms, including giants like TCS, Wipro and DMart, will have to off-load promoter stakes worth about Rs 3.87 lakh crore, following budget announcement that minimum public shareholding has to be increased to 35 percent.
Presenting her maiden budget, Finance Minister Nirmala Sitharaman on Friday said steps need to be taken to bring capital markets closer to the people and proposed raising the threshold for minimum public shareholding from 25 per cent to 35 percent. Based on the latest shareholding data, a research by Centrum Broking Ltd shows that 1,174 listed companies have promoter shareholding above 65 percent.
“To put in other words, 25 per cent of the entire universe of listed companies (4,700 companies) will have to go through off-loading promoter stakes to meet this requirement,” it said in a report post the budget announcement.
Adi Godrej says Budget won’t propel growth
Adi godrej, Chairman, Godrej Group said, “I don’t think the Budget is growth-oriented. The stock market has also come down considerably.”
Assocham welcomes infra push; CII lauds tax slash for corporates
The government’s focus on infrastructure is indeed welcome and investment to the tune of Rs 1 lakh crore over next 5 years will revitalise the economy. The Confederation of Indian Industry (CII) appreciated the government’s move to bring all companies having turnover up to Rs 400 crores under 25 percent tax-net in the Budget.
PTI
What does the Union Budget 2019 say about taxation
- No change in personal income tax rates
- Increase in surcharge on super rich: Three percent surcharge for Rs 2 crore income; 7 percent on Rs 5 crore and above
- Annual turnover limit for 25 percent corporate tax raised to Rs 400 crore from Rs 250 crore
- Taxpayers with annual turnover of less than Rs five crore to have to file only quarterly
- Direct tax revenue has increased by 78 percent
- Additional Rs 1.5 lakh deduction on home loans
- Interchangeability of PAN and Aadhaar for ITR who don’t have PAN cards
- Two percent TDS on withdrawals of Rs one crore in a year from bank accounts for business payments
- Government waives MDR changes on cashless payment
Key takeaways from Finance Minister Nirmala Sitharaman’s maiden Budget speech
- Vision for $5 trillion economy driven by investment
- Transforming rural lives
- New Jal Shakti Mantralaya to ensure Har Ghar Jal
- Enhancing ease of direct and indirect taxation
- Strengthening connectivity Infrastructure
- Gandhipedia to sensitize society
- India’s soft power
- Harnessing India’s space abilities
Ex-Finance Minister Arun Jaitley congratulates Nirmala Sitharaman on presenting maiden Budget
Former finance minister Arun Jaitley, in a tweet, congratulated Nirmala Sitharaman for the Budget 2019-20. “The budget, besides being a policy document for boosting growth, serves the larger interest of all sectors of the Economy,” he said.
Congratulations to the Hon'ble PM @narendramodi and FM @nsitharaman for the budget 2019-20. The budget besides being a policy document for boosting growth, serves the larger interest of all sectors of the Economy.
— Arun Jaitley (@arunjaitley) July 5, 2019
Nitin Gadkari hails Union Budget, says will achieve the target of becoming 3 Trillion Dollar economy this year
“This budget will prove as the foundation for New India. From rural to urban development, infrastructure to startups, from education to industry, the budget boosts all sectors. This is the vision that 125 cr people of the country required today. We will achieve the target of becoming 3 Trillion Dollar economy this year and MSME sector will contribute half of it,” Nitin Gadkari said.
‘Budget For New India’ inspires hope, lays roadmap to transform the agriculture sector, says Narendra Modi
“The Budget for new India is one of hope and it is a Budget that will boost India’s development in the 21st century. The Budget for new India has a roadmap to transform the agriculture sector of India,” Prime Minister Narendra Modi said.
Sensex drops 250 points as traders digest Union Budget, Nifty nears 11826
The market plummeted soon after the trends of the Union Budget became apparent. Sensex dropped down by almost 250 points, while Nifty neared 11,826 points.
Labour law reforms will help India leverage global skilled labour shortage, says Tapti Ghose, Partner, Deloitte India
The global demographic trends clearly indicate that major economies will have a skilled labour shortage. India proposes to leverage this by focussing on skilling India and reforming the education systems. This will also include skills sets required for working overseas such as language training in addition to an increased focus on skillset needs abroad – including language training and new age technology skills such as IOT, Big Data, Robotics. Focus on emerging new technologies in the form of artificial intelligence, data science, big data, internet of things, would revitalize technology companies. Connectivity, infrastructure, media, digital technology coupled with ease of living, ease of doing business and digital literacy is focus of the government. The replacement of multiple labour laws into four codes is expected to streamline the process of registration, standardize the filing of returns, provide uniformity in definitions across labour codes, significantly easing business. These codes are labour code on social security and welfare code on social security and welfare, Code on wages, Code on industrial relations and code on occupational safety, health and working conditions.”
Historically speaking, India has been a promoter-driven market and increasing the threshold will ensure wider ownership through institutional investors, more market depth, better price discovery and hopefully will enhance the corporate governance standards. This will potentially also be a concern of several listed companies with promoter shareholding at around 75 percent. For instance, MNCs. Promoters of such companies may want to explore options to delist such companies unless they are fine with increasing the public shareholding by another 10 percent. At 65 percent promoter shareholding, it will also be an additional hurdle to be crossed by a promoter, if a promoter was to attempt delisting. i.e. reach 90 percent through the book-building route from 65 percent than from 75 percent. The number of “OFS through stock exchange mechanism” will perhaps increase to dilute the promoter shareholding from 75 percent to 65 percent, as it is one of the fastest and cheapest ways to dilute promoters shareholding, as compared to other modes available to increase the public shareholding.
Customs duty on gold hiked to 12.5 percent from 10 percent
Finance Minister Nirmala Sitharaman increased the custom duty on gold silver and other precious metals from the existing 10 percent to 12.5 percent.
New coin series to be launched soon
A new series of coins for Re 1, Rs 2 Rs 5, Rs 10, Rs 20 to be minted so that the visually impaired can easily identify them. It is interesting to note here that unlike currency notes, the lower currency coins are minted by the finance ministry.
Exice Duty on petrol, deisel hiked by 1%
The not-so-good news comes just before the close of Sitharaman’s speech. Sitharaman has proposed to increase special additional excise duty and road and infrastructure cess each one by 1 rupee a litre on petrol and diesel. That’ll not go down well with many consumers. Petrol/ Diesel prices are set to go up an is sure to cause consumer unhappiness . Also, tax on the rich is set to go up. Those earning Rs 5 crore and above will now be in the 42 percent tax bracket.
Nirmala Sitharaman concludes Budget Speech
Nirmala Sitharaman’s speech lasted a little over 2 hours and 10 minutes
2% tax levied on cash withdrawal over Rs 1 crore per year
Our government has taken number of initiatives to promote digital payments. FM says to discourage the practice of making business payments in cash the government proposes to levy TDS of 2% on cash withdrawal exceeding Rs 1 crore in a year from a bank account, she says.
BHIM, UPI, Aadhaar Pay, NEFT, RTGS can be used to promote less cash economy. Business establishments with annual turnover of Rs 50 crore will have to use these modes of payments with no charges or merchant discount rates will be imposed on customers or merchants. RBI and banks will absorb these costs, she says.
Nirmala Sitharaman hikes surcharge on individuals with income above Rs 2 cr
In view of rising income levels, a surcharge will be levied on individuals with taxable income of Rs 2 to 5 crore, and Rs 5 cr and above. The effective tax rate for these categories will increase by around 3 percentage points and 7 percentage points, respectively
Small firms, affordable housing boost
More tax sops raining on small companies. Sitharaman puts companies with annual turn-over of upto Rs400 crore instead of Rs250 crore earlier in the lower 25% tax bracket. This will cover 99.3% of the companies meaning majority of companies are now under smaller bracket. Good news. For individual tax payers too, there is good news with Sitharaman proposing tax holiday for developers of affordable housing and additional deduction of up to Rs. 1.5 lacs for interest on
home loans borrowed up to 31.3.2020. That takes the total deduction to upto Rs 3.5 lacs.
Govt has no business to be in business, finally?
Important announcement. Sitharaman states the willingness of the central government to cut government stake in PSU undertakings and examine possibility of bringing down government stake even below 51 percent on a case to case basis. The government is willing to modify minimum 51 percent stake in PSUs policy to a minimum 51% holding through government and government-controlled PSUs, the minister says. This gives hopes of more PSU participation in divestment and government exiting their shareholdings in several PSUs. To be sure, similar promises have been made in the past but the promise has remained on paper largely. Will it be different this time?
Nirmala Sitharaman talks about addressing angel tax issue
“To resolve the issue of Angel Tax the startups and investors who file requisite declarations will not be subjected to any kind of scrutiny in respect of valuation of share premium. A mechanism of e-verification will be put in place and with this, the funds raised by startups will not require any tax scrutiny,” Sitharaman said.
Nirmala Sitharaman proposes to make Aadhaar, PAN interchangeable for ITR
Finance Minister Nirmala Sitharaman said that she proposes to make Aadhaar and PAN cards interchangeable for the purpose of filing Income Tax Returns
Labour law reforms finally?
The announcement to roll in multiple labour laws in to four codes is interesting. What exactly the action plan here, needs to be clarified. This wouldn’t be easy as there are major challenges to generate consensus on labour law changes primarily from the trade unions as we have seen in the past. Modi government too had attempted labour law reforms in the past, but couldn’t progress. Also, the state governments need to be brought in to streamline labour laws. One needs to wait and watch how the government plans to tackle the labour unions.
Govt doesn’t intend to ’trample’ taxpayers with weight of taxation: Sitharaman
Finance Minister Nirmala Sitharaman quotes a verse in Tamil: “Just a few mounds of rice cooked from a small piece of land is enough for the elephant. But if the same elephant enters a paddy field it will end up trampling more than it would consume.” Explaining the verse, she says the government does not intend to ’trample’ anybody like the elephant. The tax collection has increased to 11.37 lakh crore to 2018-19 from 6.37 lakh crore from 2013-14, she points out.
Govt slashes corporate tax rates
Nirmala Sitharaman said, “A lower rate of 25 percent is currently applicable to companies having an annual turover of upto Rs 250 crores. I propose to include all companies having an annual income of over Rs 400 crore.” She added that this will bring in 99.3 percent of all companies into the tax net and leave out only 0.4 percent companies
More money to PSBs/NBFCs; more teeth to RBI
Rs70,0000 crore additional money for government-owned banks has been proposed. That’ll be music to the ears of fund-starved PSBs. Sitharaman talks about banking/ financial sector health and states that the reduction in the gross NPAs (gross non-performing assets) of PSBSs in the last one year by around a Rs lakh crore and improvement in recoveries. NBFCs too have good news to take home. The government will give one time 6-months partial guarantee to PSBs for first loss against the purchase of the pooled assets of healthy NBFCs. Even more important, the government has proposed to hand over full regulation of both NBFCs and Housing finance companies to RBI, giving more teeth to the regulator. Good moves.
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