Finance and Corporate Affairs Minister Nirmala Sitharaman today presented to Parliament the Union Budget for 2022-23, promising growth and jobs through big public investment, raising financial assistance to States substantially, and offering a vision of digital India that extends to its villages.
The Budget Estimates for the next fiscal show a total expenditure of Rs 39.45 lakh crore, while the total receipts other than borrowings, are estimated at Rs 22.84 lakh crore.
The fiscal deficit in 2022-23 is estimated at 6.4 per cent of GDP, which is “consistent” with the broad path of fiscal consolidation announced last year to reach a level below 4.5 per cent by 2025-26, the Finance Minister said.
The revised fiscal deficit in the current year is estimated at 6.9 per cent of GDP as against 6.8 per cent projected in the Budget Estimates. As against a total expenditure of Rs 34.83 lakh crore projected in the Budget Estimates, the Revised Estimate is likely to be Rs 37.70 lakh crore during 2021-22.
Considering the role of public investment, the outlay for capital expenditure is being stepped up sharply by 35.4 per cent from Rs 5.54 lakh crore in the current year to Rs 7.50 lakh crore in 2022-23.
This will be more than 2.2 times the expenditure of 2019-20. This outlay in 2022-23 will be 2.9 per cent of GDP, she said.
The Revised Estimate of capital expenditure for the current financial year is Rs 6.03 lakh crore. This includes an amount of Rs 51,971 crore towards settlement of outstanding guaranteed liabilities of Air India and its other sundry commitments.
“While setting the fiscal deficit level in 2022-23, I am conscious of the need to nurture growth, through public investment, to become stronger and sustainable,” the Minister said.
The Finance Minister thanked taxpayers for their contribution and strengthening the hands of the government in helping their fellow citizens in this hour of need. No increase is proposed in the income tax.
As a part of the government’s overall market borrowings in 2022-23, sovereign Green Bonds will be issued for mobilizing resources for green infrastructure. They will finance the public sector.
Ending the speculation on official digital currency, the Minister announced the introduction of Digital Rupee to be issued by the Reserve Bank of India starting 2022-23. She said that the Central Bank Digital Currency (CBDC) will give a big boost to digital economy.
GST revenues are buoyant despite the pandemic, she said. Taxpayers deserve applause for this growth. Not only did they adapt to the changes but enthusiastically contributed to the cause by paying taxes. The Minister disclosed that GST collection during January, 2022 was Rs 1.40 lakh crore.
Stressing cooperative federalism, she said the existing ‘Scheme for Financial Assistance to States for Capital Investment’ has been extremely well received by the states.
In deference to the requests received during his meeting with Chief Ministers and state Finance Ministers, the outlay for this scheme is being enhanced during the current fiscal from Rs 10,000 crore in the Budget Estimates to Rs 15,000 crore in the Revised Estimates.
The next year, for 2022-23, the allocation is being substantially raised to Rs 1 lakh crore “to assist the states in catalysing overall investments in the economy. These 50-year interest free loans are over and above the normal borrowings allowed to the states, she said.
This will help States finance priority segments of PM Gram Sadak Yojana, including support for the states’ share, digitisation of the economy, including digital payments and completion of OFC network, among other schemes.
Telecommunication in general, and 5G technology in particular, can enable growth and offer job opportunities, she said. Required spectrum auctions will be conducted in 2022 to facilitate rollout of 5G mobile services within 2022-23 by private telecom providers.
A scheme for design-led manufacturing will be launched to build a strong ecosystem for 5G as part of the Production Linked Incentive Scheme.
“Our vision is that all villages and their residents should have the same access to e-services, communication facilities, and digital resources as urban areas and their residents,” Sitharaman said.
The Budget shows a big boost for a truly Digital India. A Digital University, Digital Ecosystem for Skilling and Livelihood, a Central Bank Digital Currency (CBDC), National Digital Health Ecosystem, and setting up 75 Digital Banking Units (DBUs) in 75 districts of the country by Scheduled Commercial Banks are among the proposals.
She said there was a phenomenal increase in transactions in virtual digital assets. “Accordingly, for the taxation of virtual digital assets, I propose to provide that any income from transfer of any virtual digital asset shall be taxed at the rate of 30 per cent,” She said.
Incentives for start-ups continue in the Budget. Blending of fuel is a priority of this Government and to encourage the blending of fuel, unblended fuel shall attract an additional differential excise duty of Rs 2 per litre from the 1st day of October 2022.
The Finance Minister said the Customs reforms have played a very vital role in domestic capacity creation, providing level playing field to the MSMEs. To give a boost to the Gems and Jewellery sector, Customs duty on cut and polished diamonds and gemstones is being reduced to 5 per cent.
The proposals in this budget, while continuing with the declared policy of stable and predictable tax regime, intend to bring more reforms that will take ahead the vision to establish a trustworthy tax regime, she said.
The proposals will further simplify the tax system, promote voluntary compliance by taxpayers, and reduce litigation, the Finance Minister said. To give another boost to the ease of doing business, a trust based governance is proposed for business sector.
Taxpayers are permitted to correct mistakes or omissions in their previous returns and can file Updated Returns on payment of additional tax. An updated return can be filed within two years from the end of the relevant assessment year.
To help cooperative societies. Currently, cooperative societies are required to pay Alternate Minimum Tax at the rate of 18.50 per cent. However, companies pay the same at the rate of 15 per cent. The rate for the cooperatives will be now 15 per cent.
Sunrise opportunities like Artificial Intelligence, Geospatial Systems and Drones, Semiconductor and its eco-system, Space Economy, Genomics and Pharmaceuticals, Green Energy, and Clean Mobility Systems have immense potential to assist sustainable development, she said. Government will contributed to R&D in these sunrise opportunities.
The issuance of e-Passports using embedded chip and futuristic technology will be rolled out in 2022-23 to enhance convenience for the citizens in their overseas travel.
Use of ‘Kisan Drones’ will be promoted for crop assessment, digitization of land records, spraying of insecticides, and nutrients.
To impart supplementary teaching and to build a resilient mechanism for education delivery, the ‘one class-one TV channel’ programme of PM eVIDYA will be expanded from 12 to 200 TV channels.
In 2022-23, 80 lakh houses will be completed for the identified eligible beneficiaries of PM Awas Yojana, both rural and urban. Rs 48,000 crore is allocated for this purpose.
A new scheme, Prime Minister’s Development Initiative for NorthEast, PM-DevINE, will be implemented through the North-Eastern Council.