Budget 2020 was presented on 1st February, 2020 by our Finance Minister Smt. Nirmala Sitharaman. After presenting the Budget as usual politicians from Ruling Party will support each and every proposal made in Budget,whereas politician from opposite party will called it as ‘Useless’. So ignore all this and if you truly want to know what Budget 2020 is all about read economist column. It will provide you non-subjective view.
As said in above I am not an economist but even then just want to provide you all, a non-subjective view on the Budget 2020 w.r.t. proposals that may affect Common Man.
Proposal – New optional tax slabs: New income tax slabs will be available for those who forgo exemptions.
View – Providing new optional tax slabs are definitely beneficial to those middle class earning group who are in the income range of 7.5 lakh to 12.5 lakh.
Proposal –To simplify the tax system and lower tax rates, around 70 ofmore than 100 income tax deductions and exemptionshave been
View – Academic point of view it is really good, in a sense to remember lesser provisions. Jokes apart it is good move to reduce complexity existing in current law and makes it simpler.
Proposal – Dividend Distribution Tax (DDT) abolished; Companies will not be required to pay DDT; dividend to be taxed only at the hands of recipients, at applicable rates.
View – Cost effective measure for the companies. They can use these funds for their business expansion. However, promoters who are high dividend earners will now bare the tax burden. Small investors have not much impact.
Proposal – Cash reward system envisaged to incentivize customers to seek invoice.
View – Good initiative to curb black money which is going into the pockets of seller.
Proposal – To end tax harassment, new taxpayer charter to be instituted. Tax harassment will not be tolerated, says FM.
View – Success of the system will depend on how well it is implemented and executed with rights given to taxpayer.
Proposal – To amend I-T Act to allow faceless appeals.
View – Good initiative in future. Currently the technical glitches into the system faced by the taxpayer first need to be removed. In current scenario it is cumber some to execute. Opinion of the consultants, advisers, practitioners should be obtained before given effect to such type of initiative.
Proposal – Tax holiday for affordable housing extended by 1 year. Additional deduction up to Rs. 1.5 lakhs for interest paid on loans taken for an affordable house extended till 31st March, 2021.
View – Beneficial to investors as well as to those who are engaged in such business of providing affordable housing. However, those individuals who will go for new tax regime will not get this benefit.
Proposal – Customs duty raised on footwear to 35% from 25% and on furniture goods to 25% from 20%.
View – Import of these goods now costlier and therefore price of these branded goods in consumer market will get increase. However, motive behind this is to encourage domestic manufacturer of these products.
Proposal – Turnover threshold for audit of MSMEs to be increased from Rs 1 crore to Rs 5 crore, to those businesses which carry out less than 5% of their business in cash.
View – Increasing Turnover limit for audit of MSMEs helps to small business to reduce its cost in relation to audit fees and cost related to compliance.
Proposal- To help bank depositors, government increasesdepositor insurance to Rs 5 lakh from current Rs 1 lakh.
View – It is also a good decision in favour public at large.
At the outset Initiatives, various schemes and funds support looks good and promising on the paper. But real question is whether all these schemes and funds reach to root level. Time will give the answer.
You can reach me at firstname.lastname@example.org