scorecardresearchFrom digital rupee to crypto tax: Let's look at the key budget 2022 highlights

From digital rupee to crypto tax: Let's look at the key budget 2022 highlights

Updated: 02 Feb 2022, 09:41 AM IST
TL;DR.

Finance Minister Nirmala Sitharaman presented the Union budget 2022-23 in the parliament earlier in the day. Let's take a look at the key Budget Highlights.

Union finance minister Nirmala Sitharaman at Parliament for the presentation of the Union Budget. (PTI)

Union finance minister Nirmala Sitharaman at Parliament for the presentation of the Union Budget. (PTI)

Finance Minister Nirmala Sitharaman presented the Union budget 2022-23 in the parliament earlier in the day. Let's take a look at the key Budget Highlights.

Fiscal Deficit: Finance Minister Nirmala Sitharaman pegged India's fiscal deficit for FY22 at 6.9 percent of GDP versus the target of 6.8 percent. Further, the government is targeting a fiscal deficit of 6.4 percent in FY23, she added.

GDP Growth: FM said that India's GDP growth for FY23 is expected at 9.2 percent on the back of the ongoing recovery in the economy.

Capex: Finance Minister Nirmala Sitharaman, in her budget speech, announced that the FY23 capital expenditure target has been raised to 7.5 lakh crore. This is up 35.4 percent from 5.5 lakh crore in FY22. FY23 Effective Capex Seen At 10.7 Lk Cr.

LIC IPO: FM announced that the LIC IPO will be launched shortly. NARCL has commenced its activities.

Gati Shakti master plan: FM also announced the PM Gati Shakti master plan involving expansion of the National Highway network by 25,000 km in 2022-23.

Vande Bharat Trains: FM also announced the introduction of 4000 new-generation Vande Bharat Trains, to be manufactured in the next 3 years

National Housing: Housing projects have been allotted 48,000 crore for FY23 under PM housing scheme.

Income Tax: No change in income tax slabs. However, she added that taxpayers can now file an updated return within two years from the relevant assessment year.

Crypto tax: FM announced that all income from the transfer of virtual digital assets will be taxed at 30 percent. She noted that there has been a tremendous increase in the use of virtual digital assets and it requires a specific tax regime. She made it clear that no exemptions or deductions will be allowed on the profit. She also proposed a 1 percent TDS (tax deducted at source) on transactions in such asset classes above a certain threshold.

Other tax announcements: FM reduced the minimum alternate tax (MAT) paid by co-operative societies to 15 percent from 18 percent earlier.

Also, the surcharge on the tax rate on co-operative societies has been reduced to 7 percent from 12 percent, for income between 1 crore to 10 crore.

The tax deduction limit for state govt employees to NPS raised from 10 percent to 14 percent.

FM proposes to cap surcharge on the transfer of any long-term capital gains at 15 percent.

Digital rupee: FM announced the setting up of India's official cryptocurrency - Digital Rupee. Sitharaman said the Reserve Bank of India (RBI) will issue the cryptocurrency. “Introduction of a central bank digital currency (CBDC) will give a big boost to the digital economy. Digital currency will also lead to a more efficient and cheaper currency management system," she stated. Digital Rupee using block chain to be issued by RBI starting 2022-2023.

5G rollout: FM said that 5G mobile services rollout in the country is going to begin in 2022-2023. The spectrum auctions for teh same will be conducted in 2022, she added. She further announced a PLI scheme for 5G services.

Post offices: FM Sitharaman also announced that in 2022, 100 percent of 1.5 lakh post offices will come on the core banking system enabling financial inclusion and access to accounts through net banking, mobile banking ATMs and also provide online transfer of funds between post office accounts and bank accounts.

Green bonds: Sovereign green bonds to be issued to mobilise resources as part of govt's borrowing programme.

Defence: 68 percent of the defence capex will be kept for domestic firms. Proposes to set up an umbrella body for defence equipment certification. Defence R&D will also be opened up for Industry, Startups.

Capital goods: FM proposes to levy a 7.5 percent customs duty on select capital goods.

Passports: Issuance of e-Passports will be rolled out in FY22-23.

Green clearance: Single-window portal for all green clearances will be expanded.

NorthEast: 1,500 crore allotted for development initiatives in the North East.

Some other key points

- The period of incorporation for eligible start-ups to claim the tax benefit is extended by 1 year.

- SEZ Act will be abolished and a new law will be enacted to enhance exports.

- IBC laws will be amended to enhance the resolution process and to facilitate cross-border insolvency resolution.

- 1,486 union laws were repealed last year in a step towards minimum government and maximum governance.

- Pushing digital economy and fintech will be a priority for the Government.

- Start-ups would be promoted to facilitate 'drone shakti' for the promotion of drone usage.

- 7 Engines have seen suggested for unison growth of India - Roads, Railways, Airports, Ports, Mass Transports, Waterways and Logistics infrastructure.

First Published: 01 Feb 2022, 03:05 PM IST