Union Budget 2024 -25 - Key Highlights & Takeaways

 

People from all walks of life eagerly wait for the annual budget. February 1, the D-Day when the government discloses its proposed sources and amount of revenue and resource allocation for the upcoming year, keeps individuals and businesses alike engrossed. 

February 1, 2024, was no different. Finance Minister presented what is being touted as one that is not populist even though the general elections are around the corner. Instead, the latest budget is being seen as an announcement that exudes confidence in the ruling government. 

As is the case with all large-scale exercises that encompass and have an impact on the broader population, this budget too brought cheers to some stakeholders while others wished that it could have done a little more for them. 

The thrust of the budget has been fiscal consolidation. The overarching objective of the government is to reduce the budget deficit to 5.1 per cent in the fiscal year 2024-25 (FY-25), down from 5.8 per cent in 2023-24 (FY-24). To buoy the overall economic development in the country, the budget features an increased capital expenditure (capex) by a whopping 11 percent. As a result, Rs 11.11 lakh crore will be the capex in FY-25.

Here are the main highlights of the budget and how they impact the common man:

Budget and Direct Tax

• The same tax rates for direct taxes will be followed for the fiscal year 2024-25 as well. 

For individuals below 60 years

Income Tax Slabs For Senior Citizens

Income Tax Slabs For Super Senior Citizens

* The income tax amount will attract a Cess of 4%. The surcharge is applicable on income above Rs 50 lakh.

• Certain tax benefits to Start-ups and investments made by sovereign wealth funds/pension funds, tax exemption of some International Financial Services Centre (IFSC)units earlier expiring on 31.03.2024 shall be extended up to 31.03.2025

• About one crore taxpayers are likely to benefit from the withdrawal of disputed direct tax demands up to Rs 25,000 pertaining upto  FY 2009-10 and up to Rs. 10,000 for FY 2010-11 to 2014-15.

People-Centric Inclusive Development

• All forms of infrastructure - Physical, Social, and Digital to witness substantive development.

• Digital Public Infrastructure (DPI) to enjoy formalization and financial inclusion.

• The tax base via GST will deepen and widen. 

• Strengthening of the financial sector for increased savings, credit, and investment

• To develop and promote the trading of global securities and commodities through GIFT International Financial Services Centre (GIFT IFSC).

• To proactively manage inflation.  

• All regions of the country are likely to witness active economic growth. 

The Union Budget also rolled out “Strategy for Amrit Kaal”. Some of the initiatives under it are highlighted below: 

• Inclusive development of all sections of the society with a prime focus on the upliftment of four major castes, ‘Garib’ (Poor), ‘Yuva’ (Youth), ‘Mahilayen’ (Women), and ‘Annadata’(Farmer).

• Taking adequate steps and measures to ensure that the impact of government policies reaches the last mile

• Under Rooftop solarization initiative - 1 crore households will be enabled to obtain up to 300 units of free electricity per month

• Green growth or the push towards ‘LiFE’, or Lifestyle for Environment, the country aims to reach “Net-zero” carbon emission by 2070.

• Projects for port connectivity, tourism infrastructure, and amenities will be taken up in islands, including Lakshadweep.

• Under Nari Shakti scheme 30 crore Mudra Yojana loans has been disbursed to women entrepreneurs.

• Government has encouraged “Cervical Cancer Vaccination” for girls between age group 9-14 years.

• Harnessing the potential of youth. Fostering entrepreneurial aspirations of youth - 43 crore loans sanctioned under PM Mudra Yojana.

•  Emphasis was laid on the effective implementation of the National Education Policy and subsequent job creation and business support. Opening of 30 Skill India International Centres for international opportunities. A National Apprenticeship Promotion Scheme to offer stipend support to 47 lakh unemployed youth. 

Some of the major government schemes receive major fund allocation. These include:

• Mahatma Gandhi National Rural Employment Guarantee Scheme - Rs. 86,000 crore

• Ayushman Bharat (PMJAY) - Rs. 7500 crore. The healthcare to extend to all ASHA workers, Anganwadi Workers, and helpers.

• Production Linked Incentive Scheme - Rs. 6200 crore

• Modified Programme for Development of Semiconductors and Display Manufacturing Ecosystem - Rs. 6903 crore

• Solar Power Grid - Rs. 8500 crore

• National Green Hydrogen Mission - Rs. 600 crore

The total fund allocation for Budget 2024 is as follows:

• Pension - 4%

• Interest payments - 20%

• Centrally Sponsored Schemes - 8%

• Subsidies - 6%

• Defense - 8%

• Central Sector Schemes - 8%

• Finance Commission and Other Transfers - 8%

• State’s Share of Taxes and Duties - 20%

• Other Expenditure - 9%

Conclusion

In conclusion, India's Budget Highlights 2024 reflect a strategic vision to foster economic growth and social development. The government's commitment to fiscal prudence, coupled with targeted investments, sets the stage for a dynamic and sustainable economic trajectory. As the nation navigates the challenges ahead, these budgetary measures seek to propel India into a brighter future, addressing both immediate concerns and long-term aspirations.

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ARN – INT/ED/02/24/8670