A budget is a spending plan based on income and expenses. In other words, it's an estimate of how much money you'll make and spend over a certain time, such as a month or year.
The 2024 national budget has been unveiled, addressing key areas to stimulate economic growth, support social welfare, and ensure sustainable development.
Does budget matters? Is this only a matter of tax or It decides how your life should be?
So let us start here are the Key Highlights and Insights You Need to Know about Budget 2024!"
Here are the major highlights of the 2024 budget:
What 2024 budget have for middle-class people?
The budget benefits the middle class in several ways:
Tax Relief: New tax slabs and standard deduction limits provide some relief to middle-class taxpayers.
Job Creation: Employment-linked incentive schemes and apprenticeship programs generate employment opportunities.
Education Loans: Loans of up to Rs 10 lakhs for students studying in domestic institutions with an interest rate of 3%.
Skilling Loans: Loans of up to Rs 7.5 lakhs for individuals to promote business skill development.
Housing: Interest rate subvention of 3-4% for home loans up to Rs 20 lakhs.
Healthcare: Increased allocation for healthcare schemes and programs.
Infrastructure: Investment in infrastructure development, improving roads, railways, and public transport.
Digital Inclusion: Initiatives to promote digital literacy and access to technology.
Social Security: Increased allocation for social security schemes, such as pension and insurance.
Inflation Control: Measures to control inflation, protecting the middle class's purchasing power.
These benefits aim to improve the standard of living, increase employment opportunities, and provide financial support to the middle class.
What has been allocated for skilling and employment in the 2024 Budget?
The Budget 2024 has allocated funds for skilling and employment initiatives, including:
1. Model Skill Loan Scheme: Revised to facilitate loans up to ₹7.5 lakh with a guarantee from a government-promoted Fund, benefiting 25,000 students annually.
2. Apprenticeship Program: Youth from villages will be able to work in top companies under this program.
3. Employment Linked Incentive Scheme: To generate employment opportunities.
4. National Apprenticeship Promotion Scheme (NAPS): Allocation of ₹3,000 crore to promote apprenticeships.
5. Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY): Allocation of ₹1,000 crore to enhance skill development in rural areas.
6. Pradhan Mantri Kaushal Vikas Yojana (PMKVY): Allocation of ₹1,200 crore to support skill development.
7. Skill Development Programs: Allocation of ₹1,500 crore to support various skill development programs.
These initiatives aim to:
- Enhance skill development
- Promote apprenticeships
- Generate employment opportunities
- Support rural and urban youth
The government aims to equip the workforce with industry-relevant skills, making them more employable and driving economic growth.
What's allocated for Infrastructure in Budget 2024?
The Budget 2024 has allocated a significant amount for infrastructure development, including:
1. Capital Expenditure: ₹13.7 lakh crore (around 4.5% of GDP) for capital expenditure, a significant increase from previous years.
2. National Infrastructure Pipeline (NIP): ₹111 lakh crore for NIP projects, aiming to develop world-class infrastructure.
3. Roads and Highways: ₹2.7 lakh crore for roads and highways development.
4. Railways: ₹2.4 lakh crore for railways development, including ₹1.7 lakh crore for capital expenditure.
5. Urban Infrastructure: ₹1.2 lakh crore for urban infrastructure development, including ₹15,000 crore for metro projects.
6. Rural Infrastructure: ₹1.3 lakh crore for rural infrastructure development, including ₹60,000 crore for PMGSY (Pradhan Mantri Gram Sadak Yojana).
7. Power and Renewable Energy: ₹1.2 lakh crore for power and renewable energy projects.
8. Water and Sanitation: ₹70,000 crore for water and sanitation projects, including ₹50,000 crore for Jal Jeevan Mission.
9. Airport and Aviation: ₹25,000 crore for airport and aviation infrastructure development.
10. Ports and Shipping: ₹2,500 crore for ports and shipping infrastructure development.
These allocations aim to drive economic growth, improve connectivity, and enhance the quality of life for citizens.
What is allocated for Farmers in Budget 2024?
The Budget for 2024-25 has allocated ₹1.52 lakh crore for agriculture and allied sectors. The budget also includes the following features
An initiative to introduce 10 million farmers to natural farming practices.
An emphasis on sustainable agricultural practices.
The development of climate-resilient crop varieties.
The establishment of 10,000 need-based bio-input centers.
The promotion of digital public infrastructure for agriculture.
The development of large-scale vegetable production clusters.
Financing for shrimp farming, processing, and export.
A national cooperation policy for the overall development of the country.
What is allocated for education in Budget 2024?
The Indian government has allocated ₹1.48 lakh crore for education and employment in the 2024 budget.
Here are some key highlights of the education budget:
Financial Support for Higher Education: The government will provide financial support for loans up to ₹10 lakh for higher education in domestic institutions.
E-Voucher System: E-vouchers will be given directly to one lakh students every year with an interest subvention of 3% of the loan amount.
Upgrading ITIs: 1,000 Industrial Training Institutes (ITIs) will be upgraded in a hub and spoke model, and course content will be aligned with the skill needs of the industry.
Internship Opportunities: The government will provide internships to one crore youth with a stipend of ₹5,000 and one-time assistance of ₹6,000.
Skilling Programmes: The government has announced a new centrally sponsored scheme for skilling in collaboration with state governments and industries, which will skill 20 lakh youth over the next five years.
What is allocated for health care in Budget 2024?
The Union Budget 2024 has introduced several measures to benefit hospitals and healthcare in India. Some of the key benefits include :
Increased Allocation for Health Ministry: The Health Ministry has been allocated ₹90,958.63 crore, reflecting a 12.9% increase from the previous budget.
Exemption of Customs Duties: Three cancer drugs, Trastuzumab Deruxtecan, Osimertinib, and Durvalumab, have been exempted from customs duties, making them more affordable for patients.
Reduction in Cost of Medical Equipment: The budget has proposed changes to the basic customs duty for X-ray tubes and flat panel detectors used in medical X-ray machines, which will reduce their cost.
Boost to Ayush Ministry: The Ayush Ministry’s budget has seen a significant increase of 23.74% to ₹3,712.49 crore, acknowledging the growing importance of integrating traditional medicine systems into mainstream healthcare.
Increased Funding for Medical Research: The Department of Health Research will receive ₹3,301.73 crore, which is crucial for advancing medical research and innovation.
New Medical Colleges and Sports Infrastructure: New medical colleges and sports infrastructure will be constructed in Bihar, which will improve access to healthcare and medical education.
Digital Public Infrastructure: The government will develop digital public infrastructure applications for productivity gains, business opportunities, and innovation in the healthcare sector.
Performance-Linked Incentive Scheme: The budget expenditure on the performance-linked incentive scheme for the pharmaceutical industry has been increased from ₹1,200 crores in 2023-24 to ₹2,143 crores in 2024-25.
Benefits for Taxpayers in Budget 2024
- Standard Deduction Increased: The standard deduction for salaried employees has been hiked to ₹75,000, from ₹50,000 under the new income tax regime in FY25.
- New Income Tax Slabs: New income tax slabs have been introduced, providing relief to taxpayers:
- 0-3 lakhs: 0%
- 3-6 lakhs: 5%
- 6-9 lakhs: 10%
- 9-12 lakhs: 15%
- 12-15 lakhs: 20%
- Above 15 lakhs: 25%
- Rebate Limit Increased: The rebate limit has been increased to ₹12 lakhs from ₹5 lakhs, providing relief to small taxpayers.
- No Tax on Leave Encashment: Leave encashment received on retirement will be exempt from tax.
- Deduction for Disability: A deduction of ₹1.5 lakhs has been introduced for persons with disabilities.
- Relief for Senior Citizens: Senior citizens (above 75 years) will not be required to pay tax on income up to ₹7.5 lakhs.
- Simplified Capital Gains Taxation: Budget 2024 aims to simplify the capital gains taxation regime.
- No Angel Tax: The government has proposed to eliminate the angel tax on all asset classes.
Note: These benefits apply to individual taxpayers and may vary based on individual circumstances.
The Budget for Defence in 2024
The Budget for Defence in 2024 is ₹6.21 lakh crore, which is an increase from last year's allocation of ₹5.94 lakh crore. Here are some key highlights of the defence budget:
- Capital Outlay: The capital outlay has been pegged at ₹1.72 lakh crore, which will further strengthen the capabilities of the Armed Forces.
- Domestic Capital Procurement: ₹1.05 lakh crore has been allocated for domestic capital procurement, which will provide further impetus to self-reliance in the defence sector.
- Border Infrastructure: The Border Roads Organisation (BRO) has been given a 30% increase in allocation over the last budget under the capital head, with ₹6,500 crore allocated to further accelerate border infrastructure.
- Startups in Defence: ₹518 crores has been allocated to the iDEX scheme to fund technological solutions given by startups, MSMEs, and innovators in the defence sector.
Pros & Cons of Budget 2024
Pros of Budget 2024
- Increased Standard Deduction: The standard deduction for salaried employees has been hiked to ₹75,000, from ₹50,000 under the new income tax regime in FY25.
- Reduced Custom Duty: Custom duty on precious metals like gold, and silver has been reduced to 6% and platinum to 6.5%.
- Relief for Cancer Patients: Three cancer medicines have been exempted from customs duties.
- Boost to Startups: The government has proposed to eliminate the angel tax on all asset classes, which is a long-awaited move by the startup and venture investment community.
- Simplified Capital Gains Taxation: Budget 2024 aims to simplify the capital gains taxation regime.
Cons of Budget 2024
- Increased Securities Transaction Tax: The hike in STT (Securities Transaction Tax) on F&O (Futures and Options) securities has led to a negative reaction in the stock market.
- No Changes in Crypto Tax Regulations: Crypto tax regulations remain unchanged, which could potentially slow down the sector’s growth.
- Increased Long-Term Capital Gains Tax: The tax rate on long-term capital gains for all financial and non-financial assets will rise from 10% to 12.5%.
- Removal of Indexation Benefit: The removal of the indexation benefit available on the sale of property may lead to increased tax liability for some taxpayers.
Key Takeaways of Budget 2024
1. Increased Standard Deduction: Standard deduction for salaried employees increased to ₹75,000.
2. New Income Tax Slabs: New income tax slabs were introduced, providing relief to taxpayers.
3. Boost to Infrastructure: Allocation of ₹10 lakh crore for infrastructure development.
4. Focus on Agriculture: Allocation of ₹1.52 lakh crore for agriculture and allied sectors.
5. Emphasis on Education: Allocation of ₹1.48 lakh crore for education and employment.
6. Healthcare Focus: Allocation of ₹90,958.63 crore for healthcare.
7. Defence Budget: Allocation of ₹6.21 lakh crore for defence.
8. Simplified Capital Gains Taxation: Simplification of capital gains taxation regime.
9. Relief for Startups: Elimination of angel tax on all asset classes.
10. Focus on Digital India: Allocation for digital public infrastructure and digital payments.
11. Green Energy Focus: Allocation for green energy and sustainable practices.
12. Increased Allocation for Railways: Allocation of ₹2.52 lakh crore for railways.
These key takeaways highlight the government's focus on economic growth, infrastructure development, social welfare, and digital transformation.
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