Highlights of Union Budget 2021-22

Highlights of Union Budget 2021-22

Economy

Finance Box

Finance Box

164 week ago — 3 min read

The Union Budget was tabled on 1 February 2021. Here are some of the major highlights of this budget.

 

Income Tax

  • Exemption from tax filing for senior citizens above 75 years of age with only pension and interest income.
  • Scheme of Vivad se Vishwas extended till 28 February 2021.
  • No Advance tax on dividend income until it is paid by the companies.
  • Sec 44AB limit increased to 10cr from 5cr for persons whose transactions in cash does not exceed 5% of the total transactions.

 

Companies

  • Definition of small companies has been revised by increasing their threshold for capitalization to Rs. 2 crores from the current limit of Rs 50 lakhs.
  • Tax holiday for Start-Ups extended to 31st March 2022.
  • No restriction on turnover and paid-up share capital for the incorporation of a one-person company. NRIs will also be allowed to incorporate OPCs in India.
  • Presence in India for 120 days in a year is enough to start an OPC.

 

MSMEs

  • Lower interest rates on loans i.e around 1 to 1.5%
  • 50% subsidy on a patent application
  • MAT credit can be carried up to 15 years instead of 10 years
  • Reimbursement of ISO certification charges.
  • Easy access to govt websites and government tenders
  • Access to collateral-free loans

 

Banking

  • Government to allot Rs. 20,000 crore for bank recapitalization of PSBs.
  • Immediate access to bank deposits up to Rs 5 lakhs covered under the deposit insurance.
  • Government aims to amend Insurance Act to allow higher FDI, increasing the FDI limit in insurance to 74% from 49% and allowing foreign ownership.

 

Compliance

  • Revision in Custom duty rates on certain Goods & introduction of Customs duty policy from October 2021.
  • MCA Version 3.0 is being launched which shall make E-Scrutiny, E-Adjudication, and Compliance management simpler.
  • Income Tax Appellate Tribunal to become Faceless for taxpayers with a total income of up to Rs 50 lakhs and disputed income of up to Rs 10 lakhs.

 

Others

  • LIC IPO to be out in FY 2021-22.
  • Rs 44,000 crore under capital expenditure to be allocated to the Department of Economic Affairs in FY 2021-22.
  • Additional deduction of Interest up to Rs 1.5 lakhs on Affordable Housing loans extended up to 31 March 2022.
  • The allocation to healthcare in this budget has been increased substantially.

 

Also read: A realistic budget for a challenge that comes once in a century

 

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