Indian Finance Minister Nirmala Sitharaman today presented the Union Budget 2021 in the Parliament today. The 2021 budget has given emphasis to the infrastructure and healthcare sectors but no changes have been made in the area of income tax. Besides that, several new announcements were made including the first digital census of India, the IPO of LIC, and more.

Here are the highlights of the Union Budget 2021 announced by the Indian Finance Minister:

Six Pillars of Atmanirbhar Bharat.

The Finance Minister in her budget speech outlined six pillars that will strengthen the Prime Minister’s vision of Atmanirbharta. These pillars are health and wellbeing, capital and infrastructure, innovation and R&D, minimum government and maximum governance, inclusive development and reinvigorating human capital,

Overall capital expenditure.  

The overall capital expenditure for Financial Year 22 is up to 32.5 at Rs. 5.54 lakh crore versus the 21% in Financial Year 2021. The Finance Minister said Rs. 44,000 crores under capital expenditure will be provided to the Department of Economic Affairs.

No changes in tax slab. 

This year the income tax slab has remained unchanged. However, steps have been taken in providing direct tax incentives that will ease compliance for taxpayers. According to the FM, the capital gains from securities and interest income will be prefilled in the Income Tax Return which will increase ease in returns.

Nothing for the common man, relief for senior citizens over 75

Although the budget 2021 did not have much for the “aam aadmi”, seniors and small taxpayers have been given some relief. The budget 2021 states that people above 75 years of age will not have to pay income tax returns if they are living on pensions and interest income. Small taxpayers with taxable income up to Rs. 50 lakh can avail the help of the dispute resolution committee. Now anyone under the 50 lakh cap and a disputed income of up to Rs. 10 lakh will be able to seek help from the dispute resolution committee.

No COVID-19 cess as reports suggested, Fuel and Liquor cess to be imposed.

Although no COVID-19 related cess was introduced this year, a Fuel and Liquore cess, and Agri Infrastructure and Development cess will be applied on a number of items which include fuel, liquor, etc. The FM has imposed Rs. 2.5/ liter agri infra cess on petrol, Rs.4/ liter on diesel, and 100% on alcoholic beverages.

COVID-19 impact: Budget to be allocated in preventive and curative healthcare. 

As COVID-19 drastically impacted the nation’s finances, the allocation of healthcare-related finances has been increased in the budget. The FM said that the areas that will see the allocation of funds will be preventive and curative healthcare. This allocation is likely to be around Rs 2,23,846 crore. This is a 137% increase from the budget 2020. Additionally, 35,000 crores have been allocated for the COVID-19 vaccine-related expenditure for the financial year 2022.

Government to borrow 12 lakh crore for 2022. 

The FM said the government will borrow a sum of Rs. 80,000 crore to meet the Financial Year 2021 expenditure. The government is also expected to borrow another Rs. 12 lakh crore in the Financial Year 2022.

Development Finance Institution to be set up for infrastructure projects. 

FM announced a new Development Finance Institution will be established which will spearhead the Indian physical infrastructure space. An amount of Rs. 20,000 crore will be provided to capitalize the DFI. The DFI will have a lending portfolio of Rs. 5 lakh crore for 3 years. This will provide the much-needed financial watering in the capital-dry infrastructure sector.

7 new textile parks. 

The budget also comprehensively laid out a plan of 7 new textile parks that are to be set in the next 3 years under the Mega Investment Textile Parks scheme. These parks will be established over a thousand acres of land and will have world-class infrastructure, plug-and-play capabilities.

New Electricity Distribution Reform Program. 

In a move that opens the door of privatization of electricity, Indians will now be able to choose from multiple power providers. The FM has announced Rs. 3.05 trillion electricity distribution reform program aimed at reducing state losses and also improve the efficiency of electricity distribution companies.

Infrastructure projects for 4-poll bound states. 

With the purpose of appeasing the poll-bound states, the FM announced special infrastructure projects for Assam, West Bengal, Kerala and Tamil Nadu.

For the state of Tamil Nadu, a 3500 km of national highway project will be held at an investment of Rs. 1.03 crore. For Kerala, a 600 km highway project will be underway at an investment of Rs. 65,000 crores. For West Bengal, the existing roads of Kolkata-Siliguri will be worked on at an investment of Rs. 25,000 crore.  Lastly, for Assam, Rs. 19,000 crore project is in progress with a further sum of Rs. 34,000 crore to be added in covering the 1300 km national highway.

 Other important highlights of Budget 2021: 

-India will be launching a Deep Ocean Mission which will have a budget of Rs. 4,000 crore spent over the course of the next four years. The Deep Ocean Mission will be the oceanic equivalent of ISRO’s space projects in which the government will study aspects of the ocean.

-Giving an incentive to affordable house buyers, the FM extended the time period of taking loans of such houses by one year to avail the tax benefits. The date is now extended from March 31, 2021, to March 31, 2022, to avail benefits worth Rs. 1.5 lakh under the Income Tax Act 80EEa

-The free cooking gas scheme Ujjwala will be extended to one crore more beneficiaries in the coming financial year. The FM also said that the city gas distribution network which provides CNG to automobiles and cooking gas to households will be expanded to 100 more districts.

-The FM in the budget also announced the long-awaited IPO of LIC. The FM also announced that the Indian government will be privatizing 2 Public Sector banks and one general insurance company in 2022.

-The Indian government will now allow the incorporation of a single-person company without paid-up capital or turnover. To invite International entrepreneurial talent, the FM also announced that NRI’s will also be able to incorporate single-person companies.

-The government has allocated Rs. 3,276 crore for the upcoming census which the FM has dubbed as India’s first completely digital census.

Also read: Union Budget App Launched, Check out the feature