Budget 2019 : And the Ball Goes Out of the Stadium!!

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The last budget of the Narendra Modi government’s first tenure was presented today and it has people rejoicing. Let’s get right down to the highlights of the budget after which we’ll have a brief commentary on the same.

Tax Relief:

• No tax for those with taxable income less than Rs 5 lakh
• If proper investments are made then individuals with gross income up to Rs 6.5 lakh will also be tax exempt
• Standard deduction increased from Rs 40,000 to Rs 50,000
• Tax free interest income up to Rs 40,000 in post offices and banks
• IT returns to be processed within 24 hours and refunds initiated immediately
• Income tax relief on notional rent from unsold houses extended from 1 year to 2 years

GST:

• Businesses with annual turnover of less than Rs 5 crore will be allowed to file returns quarterly
• Ways to reduce GST for homebuyers to be worked upon

Defence:

• A budget of Rs 3,00,000 crore for the first time along with the provision of additional funds if needed

Farmers:

• Those with land up to 2 hectares will be given Rs 6,000 annually in three equal instalments
• Farmers affected by natural calamities to get 2% interest subvention and additional 3% interest subvention upon timely repayment
• 2% interest subvention to farmers who pursue animal husbandry and fisheries jobs through Kisaan credit cards

Pro-Workers:

• Beneficiaries of Pradhan Mantri Shram Yogi Maandhan Yojana for unorganised sector workers with income up to Rs 15,000 per month will get Rs 3,000 per month pension after retirement with a contribution of Rs 100 per month
• Gratuity limit increased to 30 lakh

Other Points:

• Rs 60,000 crore for MNREGA
• Rs 19,000 crore for Gram Sadak Yojana
• Build 1 lakh digital villages

The budget may well be claimed by certain sections of the media as a populist one, but the fact remains that all the steps taken were the need of the hour.

A direct transfer into the bank accounts of small farmers isn’t a ‘dole’; it is something that can be very crucial to their sustainability. They may buy seeds or fertilizers with the money. A populist measure is loan waiver, and even that ends up benefitting big farmers and the small ones keep on suffering. Also, there are instances of corruption in loan waiver schemes, the most recent one being the over Rs 2,000 crore scam in Madhya Pradesh in the Congress-announced loan waiver act. A direct transfer involves no middlemen. Also, this transfer isn’t meant as a substitute for farmer income but just as an aid. Add to this the Fasal Bima Yojana, Soil Health Card scheme, expansion of drip irrigation, eNAM and many other steps by the Modi government and one can see that the government is aiming at holistic growth of farmers.

The tax relief to the middle-class is something that people deserved after standing with the Prime Minister during demonetisation and GST. Also, raising the tax limit to Rs 5 lakh was a demand even before this government came into power. This move is as far from being populist as anything can be because more disposable income in the hands of people will ensure more savings and investments. People’s purchasing power will rise which will lead to more money to flow into the economy.

The budget was an excellent keeping in mind the poor, farmers, the middle class and the unorganised workers. It was fiscally prudent as well which was the biggest worry for economists.

One huge issue addressed by Piyush Goyal was that of tax terrorism. He said that as many as 99.54% returns had been accepted without any scrutiny. If the government was of the nature to doubt the common man or scrutinize even the smallest of anomalies then this wouldn’t have happened.

The budget was a pro-people budget, one that alleviated many pains and gave many hopes for a bright future.

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