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February 01, 2020

Union Budget 2020 Highlights (Pdf Download)

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Finance Minister Nirmala Sitharaman today (1st February 2020) presented the Union Budget 2020-21 in 'bahi khata'. This is her 2nd budget in 8 months. Before presenting the budget, she paid homage to her predecessor Arun Jaitley and described him as the 'Architect of GST'. She said GST has helped in formalisation of the economy and an average household saves 4% on monthly spending after implementation of GST. Sitharaman added that GST has helped in vanishing 'inspector raj' of the past.

While presenting the Budget 2020, the Finance Minister has highlighted 3 Themes of the budget. They are- "Aspirational India", "Economic development for all" and "Caring society". 

In this budget, sitaraman introduced a new optional personal income tax system, a new tax dispute settlement scheme and unveiled a 16-point plan to revive growth in the country. The Union Budget 2020-21 has allocated ₹2.83 lakh crore for its 16-point action plan to double farmers' income by 2022. The plan includes raising fish and milk production. Of this, ₹1.6 lakh crore will go towards agriculture, irrigation and allied fields and ₹1.23 lakh crore for rural development and Panchayati Raj.

The Finance Minister also announced that Indian Railways will set up 'Kisan Rail' with refrigerated freight trains under a PPP model so that perishable goods such as milk, fish and meat can be easily transported. The Civil Aviation Ministry will start 'Krishi Udaan' on international and national routes for the transportation of agricultural produce. Sitharaman also announced that 5 new smart cities will be developed in the country. The cities will be developed with states in private partnership mode.Here are the major highlights of Union Budget 2020-21. You can download PDF version of Union Budget 2020 from HERE.

Key Highlights of Union Budget 2020

Budget 2020 in Numbers

  • List of key Budgetary Allocations :
  • Agriculture allocation : ₹1.38 lakh crore
  • Rural development allocation  : ₹1.23 lakh crore
  • Agriculture and rural allocation  : ₹2.83 lakh crore
  • Agriculture credit target  : ₹15 lakh crore
  • Education allocation  : ₹99,300 crore
  • Healthcare allocation  : ₹69,000 crore (out of the total amount, ₹6,400 crore will be sanctioned for Ayushman Bharat Yojna)
  • Transport infra allocation  : ₹1.7 lakh crore
  • Welfare of senior citizens : ₹9,000 crore
  • Uplift of Scheduled Tribes : ₹53,700 crore
  • Welfare of Scheduled castes and Other Backward Classes : ₹85,000 crore

New income tax slabs

  • 0 - 2.5 lakh - exempted
  • ₹2.5 lakh - ₹5 lakh - 5%
  • ₹5 lakh - ₹7.5 lakh - 10% (20% earlier)
  • ₹7.5 lakh - ₹10 lakh - 15% (20% earlier)
  • ₹10 lakh to ₹12.5 lakh - 20% (30% earlier)
  • ₹12.5 lakh - ₹15 lakh - 25% (30% earlier)
  • No change in tax rates above ₹15 lakh

Major Highlights of Union Budget 2020 (Quick Review)

  • Budget 2020 is based on three themes - Aspirational India, economic development for all, and caring society
  • Budget 2020 presents mega 16-point action plan for farmers.
  • 10% tax for those earning between Rs 5 to 7 lacs
  • 100% tax concession to sovereign wealth funds on investment in infra projects
  • 15% tax for those earning between Rs 7.5 to 10 lacs
  • 60 lakh taxpayers added in the last 2 years
  • Aadhaar-based verification of taxpayers is being introduced
  • Additional Rs 1.5 lakh tax benefit on affordable housing loans
  • Allocation of Rs 8,000 cr for National Mission on Quantum Computing and Technology
  • Budget proposes deferment of tax payment by employees on ESOPs from startups by five years
  • Budget to boost income, enhance purchasing power    
  • Concessional corporation tax rate for electricity generation companies in place
  • Customs duty raised on footwear and furniture
  • Date of approval of affordable housing projects for availing tax holiday on profit earned by developers extended by 1 yr
  • Degree level full-fledged online education system to be set up
  • Dividend Distribution Tax shifted to individuals instead of companies
  • Double farmers’ income by 2022
  • Estimated nominal GDP growth rate for 2020-21 at 10 per cent.
  • From April 2020, government to introduce simplified return for GST
  • Government to sell part holding in LIC
  • Govt proposes deferment of tax payment by employees on ESOPs from startups by 5 years
  • Govt to launch system for instant allotment of PAN on basis of Aadhaar
  • Govt to set up national recruitment agency for recruitment of non-gazetted posts
  • Health cess on import of medical equipment imposed in Budget
  • High-speed train between Mumbai and Ahmedabad will be actively pursued.
  • Housing made more affordable, tax holiday to affordable housing developers
  • Income above 15 lakh rupees will continue to be taxed at 30%
  • Income tax rates cut, 10% for income of Rs 5-7.5 lakh against earlier 20%.
  • Income tax rates will be significantly reduced for those who forego reliefs.
  • Income tax rates will be significantly reduced for those who forego reliefs, exemptions
  • India uplifted 271 million people out of poverty
  • Insurance cover for bank depositors to be raised to Rs 5 lakh from Rs 1 lakh.
  • Manufacturing sector Corporate Tax for new companies at 15%; for existing companies at 22%
  • Medical college to be attached to a district hospital in PPP mode
  • More Tejas-like trains between key stations, Kisan rail for farmers
  • National Education Policy coming soon
  • National Police University and National Forensic Science University proposed by Sitharaman
  • New power generation companies to be taxed at 15%
  • Nominal GDP growth for FY21 revised to 10%
  • Nominal health cess on import of medical equipment to be introduced
  • Parameters and incentives for states who take measures for cleaner air
  • Rs 12,300 crore allocated for Swachh Bharat Mission this year
  • Rs 30,757 cr for Jammu and Kashmir; Rs 5,958 for Ladakh for fiscal 2020-21
  • Rs 4,400 crore to fight Delhi air pollution
  • Rs 40,000 cr per annum will be revenue foregone from new income tax rates for individuals
  • Scheme to provide subordinated debt for entrepreneurs of MSMEs to be introduced
  • Sitharaman proposes 'Kisan Rail' in her 16-point plan to improve farm sector
  • Tax on Co-op societies to be reduced to 22% plus surcharge, as against current 30%
  • Universal pension coverage to have auto-enrolment
  • Zero-budget farming may not be a good move for fertiliser companies

Sectorwise Highlights of Union Budget 2020


  • A new tax regime has been announced. Those who want to be in the old regime with exemptions, can continue to pay at the old rates.
  • For Income Between ₹5 lakh and ₹7.5 lakh : Tax Reduced to 10% from the current 20%
  • For Income Between ₹7.5 lakh to ₹10 lakh : Tax Reduced to 15% from the current 20%
  • For Income Between ₹10 lakh to ₹12.5 lakh : Tax Reduced to 20% from the current 30%
  • For Income Between ₹12.5 lakh to ₹15 lakh : Tax Reduced to 25% from the current 30%
  • For Income Above ₹15 lakh : Tax Continue at 30%, but without exemptions
  • Over 70 deductions have been removed.
  • Companies will no longer be required to pay Dividend Distribution Tax (DDT).
  • Aadhaar-based verification for GST compliance to be introduced.
  • Aadhar-based quick issuance of PAN announced.

Economy and Finance:

  • Bank deposit insurance cover had been increased from ₹1 lakh to ₹5 lakh per depositor.
  • Government plans to amend the Companies Act to decriminalise civil offences.
  • Government to sell part of its stake in LIC via public offering.

Agriculture :

  • A budget allocation of ₹2.83 lakh crore for the sector comprising agriculture and allied activities.
  • Doubling farmers incomes by 2020.
  • Agri-credit availability set at ₹15 lakh crore for 2020-21.
  • Comprehensive measures for 100 water stressed districts.
  • Provide 20 lakh farmers to set up standalone solar pumps. Help another 15 lakh farmers to solarise their power grid.
  • Village storage scheme proposed to be run by women SHGs.
  • Indian Railways to have refrigerated coaches capability in ‘kissan trains’ to carry perishables and milk.
  • Krishi UDAN on international and national routes.

Health and Sanitation :

  • An allocation of ₹69,000 crore for the health sector.
  • ₹12,300 crore for Swachh Bharat this year.
  • Proposal to set up hospitals in Tier-II and Tier-III cities with the private sector using PPP.
  • Expand Jan Aushadhi scheme to provide for all hospitals under Ayushmann Bharat by 2025.

Education :

  • ₹99,300 crore for education sector in 2021 and about ₹3,000 crore for skill development.
  • Urban local bodies to provide internship to young engineers for a year.
  • Degree-level full fledged online education programmes by institutions ranked in top 100 in NIRF rankings, especially to benefit underprivileged students.
  • A national police university and a national forensic science university is proposed to be setup.
  • IND SAT exam for students of Asia and Africa to promote “study in India” programme.

Infrastructure :

  • Budget proposes to provide ₹1.7 lakh crore for transport infrastructure in 2021
  • National Logistics Policy to be released soon.
  • Chennai-Bengaluru Expressway to be started.
  • Aim to achieve electrification of 27000 km of lines.
  • Plan to have a large solar power capacity for Indian Railways.
  • The government also proposes a Bengaluru suburban rail project at a cost of ₹18,600 crore.
  • Govt to monetise 12 lots of national highways by 2024.
  • 100 more airports will be developed by 2024 to support UDAN.

Indian Railways

  • 4 station re-development projects in railways via PPP models
  • To develop solar capacity in Indian railways
  • Plan more Tejas like trains to connect tourist locations
  • Govt to launch ₹18,600 crore worth Bengaluru Suburban Transportation project

Swachh Bharat Mission

  • The Finance Minister announced that the total allocation proposed for Swachh Bharat Mission is ₹12,300 crore
  • Nirmala Sitharaman said the NDA government is "committed to Open Defecation Free (ODF) plus in order to sustain ODF behavior and to ensure no one is left behind."

To Clean Air and Pollution free cities

  • Power plants with emissions above prescribed limits will be asked to close down.
  • India's commitment towards tackling climate change made at Paris conference kick starts from January 1, 2021.
  • FM said ₹4,400 crore has been allocated for states that work towards clean air.

Connecting India

  • Finance Minister Nirmala Sitharaman said ₹6,000 crore allocated for BharatNet programme
  • Around 1 lakh gram panchayats to be linked with BharatNet this year

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