It is that time of the year again! The annual budget has been presented by Finance Minister Nirmala Sitaraman. Termed as ‘conservative but realistic’ the budget has put forth various proposals that have earned bouquets and brickbats alike.
Key Highlights of the 2022 Union Budget
- Overall government spending is 4.6% more than that of the current year with defense getting the highest allocation
- The total expenditure is expected to be Rs. 39.45 lakh crore
- India’s economy is projected to grow at 9.2% in FY 22 as per government’s estimate but inflation is still a cause for concern.
- There are no changes in the existing income tax slab for 2022-23
- A central digital bank currency using blockchain technology will be introduced. Additionally, a 30% tax will be imposed on income earned from Virtual Digital Assets such as cryptocurrencies and NFTs.
- Surcharge on long term capital gains to be capped at 15% against 37% previously
- Infrastructure (roads, railways, airports, etc.) to be upgraded under the PM GatiShakti Master Plan.
- Mental health services to be given a boost with the launch of the National Tele Mental Health Programme with Bengaluru’s NIMHANS as a nodal center
- Budget allocation for farmer’s welfare as well as Ministry of Agriculture has been increased by 4.5%
- A Digital University to be established to provide world class quality education to students from across the country
Expensive vs. Affordable – At a Glance
Wondering what you can save money on vs. what you need to spend more on?
Here’s a list for you –
Provisions Offered Under Various Sectors –
For Individual Taxpayers
Wondering how the budget impacts your taxes? Take a look below –
- No changes in the existing income tax slab for 2022-23. Individuals can opt for any of the two existing income tax regimes
- If you have not declared certain assets or payments in your ITR, you can now pay an updated return within 2 years from the end of the relevant assessment year.
- However, this comes at an additional cost of up to 50% of liability
- 30% tax will be imposed on income earned from Virtual Digital Assets such as cryptocurrencies and NFTs. Does this mean that crypto assets will be legalized in India? Only time will tell.
- Long term capital gains (gains from assets you have held for over a year such as stocks, land, etc.) to be subject to surcharge of 15% for all assets as opposed to 37% previously which is good news.
- A new tax benefit/deduction has been introduced for guardians/parents of disabled under Sec 80DD.
- Under this option, the parent/guardian can avail a tax benefit on savings life insurance policy which has the disabled individual as beneficiary.
- State Government employees can benefit from an increased tax deduction limit of 14% on employer’s contribution to NPS (National Pension Scheme).
- Payment received from an employer for COVID related treatment is non-taxable. Additionally, payment received by the employee’s family is also non-taxable up to Rs. 10 lakh.
Stay tuned for Part II of this blog where we bring you budget highlights from Healthcare, Infrastructure, Education, and Housing perspective.
In the meantime, what do you think of the implications of the budget on your taxes? Let us know in the comments!