Union Budget Updates & Key features 2022:

Digital assets tax

30 per cent tax on digital asset transfer. Gifts of digital assets to be taxed as well. This includes any income from sale or acquisition of virtual and digital assets.

Cooperative societies tax

Tax rate for cooperative societies reduced to 15 per cent.

GST

Remarkable progress in GST but there were huge challenges, says Nirmala Sitharaman.

RBI Digital Rupee would be launched this year

LTCG surcharge rate to be maximum @15%

The government has not changed income tax rates this year.

Top 100 Highlights of Budget 2022 by Finance Minister Nirmala Sitharaman

Union Finance Minister Nirmala Sitharaman has reached Parliament after meeting President Ram Nath Kovind. She is set to set to present her fourth Budget today — February 1 — for the financial year 2022-23 amid an ongoing third wave of omicron-led coronavirus and volatile stock markets as inflation worries weigh on the sentiment. The Union Budget or the Annual Financial Statement as specified in the Article 112 of the Indian Constitution will be presented in Parliament at 11 am Following are the Highlights of Budget

1. Crypto currency to be taxed at 30 % special rate, no deduction allowed.

Online digital assets to be taxed @ 30%. No deductions or set off of losses. Flat tax at 30% will be lived without any deduction. No deduction except cost of acquisition. TDS at 1% to be deducted on transaction value. No deduction in respect of any expenditure or allowance shall be allowed while computing such income, except cost of acquisition

2. Corporate surcharge to be reduced from 12% to 7%

3. Health and Education Cess and Surcharge shall not be allowed as business expenditure

4. Propose to cap surcharge for AOPs at 15%. Also cap surcharge on LTCG arising from transfer of assets at 15% to give a boost to startup community

5. No Change in Slab Rates for Individuals and others

6. If undeclared income detected during search, no deduction will be allowed on such additional income

7. Propose a provision to file an updated return with payment of additional tax to correct any errors in assessment. Assesses can declare income that may have been missed out previously. New provision introduced to file updated ITR within 2 years in case of any omission or mistake

8. To reduce surcharge on co-operative societies to 7% from 12% for income between Rs 1 cr to Rs 10 cr

9. FM said despite of Covid Pandemic GST collection has touched all time high from it’s inception. FM gave credit to recovering economy and administrative measures taken by revenue department. Gross GST collection in Jan 2022- 1,46,986 cr. Highest since inception of GST

10. Persons with disability – Parents and Guardians can avail annuity even in their life time

11. Gross GST collects for Rs 1,46,986 Cr which is highest since inception of GST; possible due to rapid economic recovery post Covid-19

12. Tax Deduction limit for state govt employees to NPS raised to 14% from 10%

13. Incentives for startups: period of incorporation extended by a year to 2023 to avail of tax benefits. For corporates, Extension also granted for new companies to setup manufacturing facilities to 2024 from earlier 2023

14. Section 115BAB the date for setting up business increased by one year to 2024. Incentive for newly incorporated manufacturing industry a concessional tax rate of 15% was introduced

15. Issuance of E-passports will be ruled out in 2022-23 to enhance convenience for citizens

16. India Economic Growth in FY22 to be at 9.2%. Economic growth estimated at 9.2%

17. 25,000 compliances have been done away with and 1,486 union laws have been repealed

18. Digital rupee to be issued using blockchain and other technologies; to be issued by RBI starting 2022-23. This will give a big boost to the economy

19. Budget seeks to lay the blueprint to steer the economy over the next 25 years from India at 75 to India at 100

20. Children mostly in Govt schools have lost 2 years of formal education. High quality e content will be developed in regional languages. A digital university will be setup. Will be built on a network hub-spoke model

21. Teachers will be equipped with digital tools. Digital University will be set up

22. Public issue of LIC is expected shortly. Others are also expected shortly. This budget will continue to provide impetus for growth- futuristic & inclusive

23. Speed in coverage of vaccination has helped in economic recovery

24. Modern Infra for India at 100 with Multi modal approach

25. Budget to focus on 4 pillars – productivity, climate action, financing investments & PM Gati Shakti plan

26. PM GatiShakti Energy transition, Climate Action to fuel Sustainable development

27. PLI in 14 Sectors to create 50 lakh new jobs and additional production of Rs 30 lakh Cr

28. We are in the midst of the Omicron wave, the speed of our vaccination campaign has helped greatly. I am confident that ‘Sabka Prayaas’, we’ll continue with strong growth

29. This Budget (2022-23) will benefit, youth, women, farmers, SC, ST… ; shall be guided by PM Gati Shakti master plan

30. Contracts for 4 multimodal logistics parks in PPP mode will be awarded in 2022-23

31. 400 new generation Vande Bharat trains with better efficiency to be brought in during the next 3 years

32. 100 PM Gati Shakti Cargo terminals to be developed during next 3 years and implementation of innovative ways for building metro systems

33. The National Highway network will be expanded by 25,000 kms in 2022-23

34. Support will be provided for branding and marketing and harvest of millets. 2022-23 has been announced as International Year of Millets

35. MSMEs: ECLGS has provided much needed credit. Scheme to extended to March 2023, cover to be expanded by 50,000 cr to 5 lakh cr. With the additional amount earmarked for hospitality sector

36. Rs 20000Cr to boost Transport Infra

37. Rs 2.73 lakh Cr as Public Procurement/MSP for Wheat &Paddy

38. Focus on Natural,Chemical Free& Zero Budget Farming

39. Drones for Agriculture

40. ECLGS till March 2023,with total cover of Rs 5 lakh Cr

41. Unified Logistics Interface Program for JIT Inventory Management

42. Railways to fuel Logistics for Small Farmers

43. One Station One Product for Local Businesses

44. 2000km under Kawach 400

45. Vande Bharat Trains

46. 100 Cargo Terminals

47. Productivity-linked incentive schemes in 14 sectors have received excellent response; received investment intentions worth Rs 30 lakh crore

48. Chemical-free natural farming will be promoted throughout the country with a focus on farmers’ land in 5 km wide corridors along the river Ganga, in the first stage

49. Procurement of wheat in Rabi season 2021-22 and the estimated procurement of paddy in Kharif season 2021-22 will give cover 1208 lakh metric tonnes of wheat & paddy from 163 lakh farmers& Rs 2.37 lakh crores will be the direct payment of MSP value to their accounts

50. Emergency Credit Line Guarantee Scheme (ECLGS) extended till March 2023. Guarantee cover for ECLGS will be expanded by Rs 50,000 cr to a total of Rs 5 lk cr.

51. MSMEs such as Udyam, e-shram, NCS & Aseem portals will be interlinked, their scope will be widened… They will now perform as portals with live organic databases providing G-C, B-C & B-B services such as credit facilitation, enhancing entrepreneurial opportunities

52. PM Gati Shakti will pull forward the economy and will lead to more jobs and opportunities for the youth

53. National tele mental health program to be launched, steered by NIMHANS, National Tele Mental Health Centres of Excellence to be launched

54. Will promote startups for drone manufacturing

55. Data exchange among all-mode operators to be brought on Unified Logistics Interface Platform, designed for API will enable, Efficient movement of goods, Reduce logistics costs and time, Assist Just In Time inventory management and Eliminate tedious documentation

56. PM E-Vidya to be Expanded to 200 TV channels in Regional Languages with focus on High quality e-content

57. 2 Lakh Anganwadis to be Upgraded

58. 8.7Cr Households have access to Har Ghar Jal,with

59. 5.5Cr getting Drinking Tap Water

60. Rs 50000Cr to cover 3.8Cr Households in 2022-23,under Har Ghar Jal

61. 80 Lakh Beneficiaries identified under PM Awas Yojana, for 40000Cr

62. Implementation of Ken-Betwa rivers linking with estimated cost of Rs 44,605 cr to be taken up

63. Propose to setup 75 digital banking units in 75 districts by scheduled commercial banks

64. PM Gati Shakti is driven by 7 engines: roads, railways, airports, ports, mass transport, waterways & logistics infra.

65. Kisan Drones for crop assessment, land records, spraying of insecticides expected to drive a wave of technology in agri sector

66. Rs 6,000 crore programme to rate MSMEs to be rolled out over 5 years

67. 400 new generation Vande Bharat trains with better efficiency to be brought in during the next 3 years; 100 PM Gati Shakti Cargo terminals to be developed during next 3 years and implementation of innovative ways for building metro systems

68. 1.5 lakh post offices to be connected to core banking

69. A network of 23 tele mental health centres of excellence with Nimhans being the nodal centre and IIIT Bangalore providing technology support

70. Push for EVs by Battery swapping policy will be brought out and inter-operability standards will be formulated

71. To promote a shift to the use of public transport in urban areas…special mobility zones with zero fossil fuel policy to be introduced…Considering space constraints in urban areas, a ‘Battery Swapping Policy’ will be brought in

72. Accelerated Corporate Exit for voluntary winding of company from current 2yr to less than 6months

73. Digital university to be set up to provide education; to be built on hub and spoke model

74. High level committee of urban planners, economists & others will be setup to facilitate reforms. Necessary amendments in IBC to be made for more efficient resolution; to also enable cross border insolvency resolution

75. Fund to be facilitated through NABARD to finance startups for agriculture and rural enterprise, relevant for farm produce value chain. Startups will support FPOs and provide tech to farmers

76. 2,000 km of rail network to be brought under the indigenous world-class technology KAWACH, for safety and capacity augmentation

77. Spectrum auctions will be conducted in 2022 to roll out 5G services. Scheme for design led manufacturing in 5G to be launched as part of PLI scheme

78. Special economic zone policy to be replaced with a new legislation

79. Battery Swapping Policy will be brought out & inter operational service will be formulated. Private sector will be encouraged to create sustainable and innovative business models for battery and energy as a service, improving the efficiency in the EV ecosystem

80. ‘One Nation, One Registration’ will be established for anywhere registration to facilitate ease of living & doing business:

81. Implementation of Ken Betwa Linking project at est. cost of Rs. 44,605 Cr. to be taken irrigation benefits to 9.0 lakh hectare farm land

82. 68% of the capital procurement budget for Defence to be earmarked for domestic industry to promote Aatmanirbharta and reduce dependence on imports of defence equipment. This is up from the 58% last fiscal

83. To reduce the delay in payment, an online bill system to be launched which will be used by all Central ministries

84. Animation, Visual Effects, Gaming and Comics (AVGC) sector offers immense potential to employ youth. An AVGC promotion task force with all stakeholders will be set up to recommend ways to realise this and build domestic capacity for serving our markets and the global demand

85. Fund to be facilitated through NABARD to finance startups for agriculture and rural enterprise, relevant for farm produce value chain. Startups will support FPOs and provide tech to farmers

86. SEZ Acts will be replaced with a New Act. SEZ (Special Economic Zones) Act will be replaced with new legislation…for the development of enterprise and hubs… It will cover the existing industrial enclaves and enhance the competitiveness of exports

87. To achieve 280 GW of solar power by 2030, Additional allocation of Rs 19,500 towards solar PLI for mfg of high efficiency modules

88. Amendments for the Bankruptcy Code – IBC amendments to enhance efficiency of resolution process – Facilitate cross-border insolvency resolution – To speed up voluntary winding up of companies

89. A high-level panel to be set up for urban planning

90. Modern building by-laws will be introduced

91. Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) to be revamped with required fund infusion Will facilitate additional credit of Rs. 2 lakh crore for Micro and Small Enterprises and expand job opportunities

92. Effective Capital Expenditure of the Central Govt is estimated at Rs 10.68 lakh crores in 2022-23, about 4.1% of GDP: Public expenditure needed to pump prime demand and crowd in private investment

93. A new scheme PM development initiative for North East will be initiated to fund social development projects

94. 5 existing academic institutions for urban planning to be designated as Centre for Excellence with endowment fund of Rs 250 cr

95. Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE) to be revamped with required fund infusion Will facilitate additional credit of Rs. 2 lakh crore for Micro and Small Enterprises and expand job opportunities

96. Sovereign green bonds will be used to finance green projects

97. To setup an expert committee to examine holistic regulatory framework for VCs, PEs and look at areas of friction

98. Capital Expenditure to increase 35.4% from ₹5.54 lakh crore to 7.50 lakh crore

99. Total expenditure is estimated at Rs39.45 lakh cr Receipts are estimated at Rs22.84 lakh cr. FY’23 fiscal deficit target at 6.4% of GDP vs 6.9% (RE)

100. Rs 1 lakh crore financial assistance to states to be provided in 2022-23 to catalyse investments

Key-Highlights of GST Proposals in Finance Bill 2022:

1. Time-limit to avail ITC u/s 16(4) extended till 30th November of next year from 30th September.

2. Additional Condition for availment of ITC u/s 16(2)- ITC can be availed only if the same is not restricted in GSTR-2B.

3. Composition Tax Payer’s Registration can be cancelled suo-moto if they have not filed their GSTR-4 return beyond 3 months from the due date.

4. Credit Notes in respect of supply made in a financial year can be issued by 30th November of next financial year (currently allowed till 30th September)

5. Any rectification of error in GSTR-1/ GSTR-3B is now permitted till 30th November of next financial year (currently allowed till 30th September).

6. The two-way communication process in filing GST returns is scrapped.

7. The due date for filing return by non-resident taxable person is prescribed as 13th day of next month

8. Section 41 of the CGST Act is being substituted so as to do away with the concept of “claim” of ITC on a “provisional” basis.

9. Section 47 of the CGST Act is being amended so as to provide for levy of late fee for delayed filing of TCS returns.

10. Section 49 of the CGST Act is being amended so as to provide for restrictions for utilizing the amount available in the electronic credit ledger.

11. Section 49 of the CGST Act is being amended so as to allow transfer of amount available in E- cash ledger of a registered person to the E- cash ledger of a distinct person;

12. Section 49 of the CGST Act is being amended so as to provide for prescribing the maximum proportion of output tax liability which may be discharged through the electronic credit ledger

13. Section 50(3) of the CGST Act is being substituted retrospectively, with effect from the 1st July, 2017, so as to provide for levy of interest on input tax credit wrongly availed and utilized. (Meaning  thereby Interest will not be levied if ITC is not utilized)

14. Refund claim of any balance in the electronic cash ledger shall be made available.

15. Rate of Interest u/s 50(3) prescribed as 18% in all cases.

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