Union Budget 2021

Highlights of Union Budget 2021-22

General

• First digital Budget in the history of India
• Vehicle Scrapping Policy. Vehicle Fitness Test after 20 years in case of Personal vehicle and 15 years in case of commercial vehicles
• 64,180 crores allocated for New Health Schemes
• 35, 000 crores allocated for Covid Vaccine
• 7 Mega Textile Investment parks will be launched in 3 years
• 54 lakh crore provided for Capital Expenditure
• 18 lakh crore for Ministry of Roads
• 10 lakh crore allocated to Railways
• Proposal to amend Insurance Act. Proposal to increase FDI from 49% to 74 %.
• Deposit Insurance cover (DICGC Act 1961 to be amended). Easy and time bound access of deposits to help depositors of stress banks.
• Proposal to revive definition of ‘Small Companies’ under Companies Act 2013. Capital less than 2 Cr. and Turnover Less than 20 Cr.
• Disinvestment: IPO of LIC, Announced Disinvestment of Companies will be completed in FY 2021-22

Direct and Indirect tax

• Senior Citizens: Reduced Compliance burden. 75 years and above. Proposal not to file ITR if only pension income and interest income.
• Reduction in time for IT Proceedings: Reopening of Assessments period reduced from 6 years to 3 years except in cases of serious tax evasion cases
• Proposal to constitute ‘Dispute Resolution Committee’. (Taxable income 50 lakhs and disputed income 10 lakh).
• National Faceless Income Tax Appellate Tribunal Centre
• Relaxations to NRI: Propose to notify rules for removing hardship for double taxation.
• Tax Audit Limit: Proposal of tax audit increased from 5 Cr. to 10 cr. (Only for 95% digitized payments business)
• Propose to provide relief on advance tax liability on dividend income.
• Propose to include tax holidays for Aircraft leasing companies
• Prefiling of returns (Salary, Tax payments, TDS etc.) Details of Capital gains from listed Securities, dividend income, etc. will be prefilled
• Small Charitable Trusts. Increased from 1 crore to 5 crores (Compliance limit)
• Late deposit of employee’s contribution by employer will not be allowed as deduction
• Incentive to startup: Tax holiday exemption for one more year
• Duties reduced on various textile, chemicals and other products
• Gold and Silver (BCD reduced)
• Agriculture Products: Custom duty increased on cottons, silks, alcohol etc.