Budget 2020 Highlights

There have been several important developments and improvements on the 2020-2021 Union Budget. In this blog, you’ll see some the highlights and the main points of the budget.

Now, we know that you want to see the new income tax slabs, but wait for it my friend. We’ll tell you all about it, but let's get started with the basics…

Prominent Themes of the Budget

The main theme of the 2020-2021 Union budget is Ease of Living, supported by governance and the financial sector.

Ease of Living branches into:

1. Inspirational India:
   This includes
   i) Agriculture, Irrigation and Rural Development
   ii) Wellness, Water and Sanitation
   iii) Education and Skills.

2. Economic Development:
   This includes
   i) Industry, commerce and investment
   ii) Infrastructure
   iii) New Economy.

3. Caring Society:
   This includes
   i) Women & Child, Social Welfare
   ii) Culture and Tourism
   iii) Environment and Climate Change.

Now, let us come to the main points of the 2020 Annual Budget pertaining to personal finance.

Here are the key highlights of Union Budget 2020-21

On the Tax Front

The Finance Minister in the budget speech said that the new tax regime is “lowest, simplest, and smoothest.”
It boasts 100% tax exemption on Sovereign Wealth Funds' Infra Investment, and concession of 5% on withholding tax extended to municipal bonds.

On DDT or Dividend Distribution Tax

There is good news for companies. From now on, they do not need to pay the DDT or Dividend Distribution Tax. However, the dividend shall only be taxed on the dividend recipients.

Good news for taxpayers- Income tax slabs 2020

The Indian Finance Minister Nirmala Sitharaman says that the personal income tax is at an all-time low. 

Income tax rates shall be reduced significantly for those who do not take relief measures and tax exemptions.

Budget 2020 - Price Increase and Decrease

Thanks to changes in customs and excise duties, the price of some items have gone up, while the price of others have gone down.

Let’s take a look at what they are:

Price goes Up

1. Cigarettes, hookah, and other tobacco products

2. Food items like cooking oil, ghee, butter, cheese, and chewing gum

3. Tableware, kitchenware

4. Imported footwear

5. Footwear parts

6. Furniture goods

7. Household electrical appliances

8. Water filters, padlocks, brooms, hand sieves, combs

9. Imported toys

10. Mobile phone chargers, power adaptors, fingerprint displays, earphones and headphones

11. Portable medical devices

Price goes Down

1. Multiple food products

2. Some electronic items

3. Electric vehicles

4. Sports goods

5. Newsprint

Welcome News for the Fintech Industry

The growing Fintech industry in India sees the new budget in a positive light, as it gives a holistic growth projection for this industry, which is an extension of the scheme for doubling infra boost, farmer’s income, and more.

The government has also proposed Rs. 27,300 crores for the development of the country’s commerce and industry.

Hon'ble FM Nirmala Sitharaman added that public institutions at the Gram Panchayat level shall be provided with Fibre digital connectivity. This way, more than 1,00,000 gram panchayats will be linked by Fibre through BharatNet. Rs. 6000 crore is already allocated for this task. Additionally, a fund of Rs. 8000 crore is allocated to the National Mission on Quantum Computing and Technology for various projects, like setting up Data Centre Parks.

“Technology that has now a greater significance in almost all the sectors was also a pivotal part of Union Budget announcements. The Union Budget 2020 has shown a ray of light for the Fintech sector, with FM Nirmala Sitharaman stating that India will embrace a shared economy with aggregators displacing regular business.”
- commented the owner of a well-known Fintech firm in India on the the Indian Budget -
“The importance of Analytics, IoT, and AI has been recognized in this budget, as they are set to change the world. A policy has been announced to set-up data centre parks all through the country.”

To see the highlights of the 2020 Union budget in infographics, click here.

For all the related documents, click here.