Union Budget: Incomes And Expenses! All About The Final Budget For 2024-25

Union Budget 2024: Finance Minister Nirmala Sitharaman during her seventh Budget speech, said, the people of India have reposed their faith in the government led by PM Modi and re-elected it for a historic third term under his leadership. She highlighted that the full year and beyond focus of this Budget will be on employment, skilling, MSMEs, and the middle class.

In line with the strategy of 'Viksit Bharat', Sitharaman said, this budget envisages sustained efforts on the following 9 priorities for generating ample opportunities for all.

These 9 priorities are -- 1) Productivity and resilience in Agriculture; 2) Employment & Skilling; 3) Inclusive Human Resource Development and Social Justice; 4) Manufacturing & Services; 5) Urban Development; 6) Energy Security; 7) Infrastructure; 8) Innovation, Research & Development and; and 9) Next Generation Reforms.

Sitharaman detailed some of the specific actions to be initiated in the current year towards the fulfilment of these priorities with the potential for transformative changes.

Adding, she said, "The budget also covers some of the previously made announcements with an intent to strengthen them and step up their implementation for expediting our journey towards the goal of Viksit Bharat."

Here are the key highlights of the Budget:

1. Budget Estimates 2024-25:

- Total receipts other than borrowings: Rs 32.07 lakh crore.

- Total expenditure: Rs 48.21 lakh crore.

- Net tax receipt: Rs 25.83 lakh crore.

- Fiscal deficit: 4.9 per cent of GDP. While the government aims to reach a deficit below 4.5% by next year.

- Inflation continues to be low, stable and moving towards the 4% target; Core inflation (non-food, non-fuel) at 3.1%.

Package of PM's five schemes for Employment and Skilling:

Prime Minister's Package of 5 Schemes and Initiatives for Employment, skilling and Other Opportunities for 4.1 crore youth over 5 years, as per the Budget FY25.

As part of the Prime Minister's package, 3 schemes for 'Employment Linked Incentive' are to be implemented - Scheme A - First Timers; Scheme B - Job Creation in Manufacturing; Scheme C - Support to Employers.

Also, the FM said that a new centrally sponsored scheme will be introduced for Skilling under the Prime Minister's Package for 20 lakh youth over 5 years. Additionally, the Model Skill Loan Scheme will be revised to facilitate loans up to Rs 7.5 lakh.

To give a big boost to MSMEs, FM said a credit guarantee scheme without collateral or third-party guarantee in term loans to MSMEs for purchase of machinery and equipment, will be introduced. Also, the limit of Mudra loans under the 'Tarun' category is to be enhanced to Rs 20 lakh from Rs 10 lakh for those who have successfully repaid previous loans.

Further, FM announced the allocation of Rs 1.52 lakh crore for agriculture and allied sectors.

Reacting to the Budget 2024, Mr. Pradeep Misra, Chairman & MD of Rudrabhishek Enterprises Limited (REPL) said, "The 2024 budget shows a strong focus on inclusive development around infrastructure focus, taking into account both local needs and global economic conditions. The big investment of Rs 11.11 lakh crore for infrastructure, which is 3.4% of GDP, shows the government's commitment to growth through infrastructure spending. This ongoing focus on infrastructure in recent budgets is likely to have a positive effect on many parts of the economy. The Rs 10 lakh crore plan for PM Awas Yojana-Urban 2.0 is a big deal for housing and construction. This, along with tweaking in income tax, could bring more people into the affordable housing market, boosting demand and creating jobs in construction. Several announcements have been made for the generation of employment and skill enhancements. These will ultimately increase the disposable income at the household level that will push growth in overall economy, especially the housing segment."

"The focus on improving water supply, sewage treatment, and waste management in 100 big cities offers good opportunities for companies working in urban infrastructure. The Rs 2.66 lakh crore for rural development could help balance out growth between cities and rural areas. Additionally, the launch of Phase 4 of the PM Gram Sadak Yojana to provide all-weather roads to 25,000 rural habitats is a significant step towards improving rural connectivity and economic opportunities. However, we were expecting the announcements related to the fund outlay for Smart City Mission 2.0. The plan to develop TOD in 14 large cities will also definitely help in creating industrial and commercial hubs in these catchment areas. Digitalization of Land records in urban areas with GIS mapping will increase the transparency and provide the better administrative services," Pradeep Misra further added.

"Encouraging private investment through funding support and new financing options is a smart move. This could bring more private money into infrastructure projects, leading to new ideas and better efficiency. However, for this to work well, the government needs to address issues like land acquisition and environmental clearances," Pradeep Misra commented.

The Budget was divided into two parts namely A and B.

Coming to the B part of the budget which included revisions and key changes in direct and indirect taxes for citizens and corporations.

To enhance the benefits of GST, FM said, "We will strive to further simplify and rationalise the tax structure and endeavour to expand it to the remaining sectors."

She proposed customs duties intended to support domestic manufacturing, deepen local value addition, promote export competitiveness, and simplify taxation while keeping the interest of the general public and consumers surmount.

In the case of personal taxes, the Finance Minister announced tax exemptions for charities and TDS. She said, the 5 per cent TDS rate on many payments is being merged into the 2 per cent TDS rate and the 20 per cent TDS rate on repurchase of units by mutual funds or UTI is being withdrawn. The TDS rate on e-commerce operators is proposed to be reduced from one to 0.1 per cent. Moreover, credit of TCS is proposed to be given in the TDS to be deducted from salary.

Further, she also simplified capital gains such as short-term and long term. She said, 142. Short-term gains on certain financial assets shall henceforth attract a tax rate of 20%, while long-term gains on all financial and non-financial assets, on the other hand, will attract a tax rate of 12.5%.

For salaried individuals, FM Sitharaman increased the standard deduction to Rs 75,000 from Rs 50,000. Also, she announced deduction on family pension for pensioners is proposed to be enhanced from Rs 15,000 to Rs 25,000. FM also revised the tax structure under the new regime.

Moreover, FM has proposed to abolish angel tax for classes of investors. To attract foreign investments, she proposes to reduce the corporate tax rate on foreign companies from 40% to 35%.

"While the budget sets big goals for infrastructure growth, keeping the government's spending in check will be a challenge. The attention given to small and medium businesses is also important, as it supports a key part of the Indian economy. The mandatory TReDs registration turnover criteria has been lowered to Rs. 250 Crore which will bring a big cash flow relief to MEMEs if implemented properly. Overall, this budget could greatly change India's economy through infrastructure development. The key will be to carry out these plans effectively and keep focusing on them in the coming years," said Pradeep Misra.

This was the first Budget under Modi 3.0.