Union Budget 2022-23 Highlights: Live Updates, Income Tax Info

By Stuti Mishra|Updated : February 1st, 2022

Union Budget 2022-23 has been laid out in both the houses of Parliament by Union Finance and Corporate Affairs Minister Nirmala Sitharaman. It is the second digital Union Budget of India. Let's dig deep inside to know important key highlights of Union Budget 2022-23, live updates, income tax slabs and other important details.

What is Union Budget?

  • Union Budget of India is the annual financial statement of the government, that estimates the revenue and expenses of our country within a year.
  • Union Budget of India is referred to as the Annual Financial Statement in Article 112 of the Constitution of India.
Table of Content

Union Budget 2022-23 Key Highlights - Full Analysis

Highlights of Union Budget 2022-23

Pillars of Union Budget 2022-23

Union Budget 2022-23 comprises of four Pillars:

  • PM Gati Shakti
  • Inclusive development
  • Productivity Enhancement & Investment, Sunrise Opportunities, Energy Transition, and Climate Action
  • Financing of investments

Union Budget 2022-23 will lay a special focus on youth, women, farmers, and the backward classes.

India's growth is estimated to be at 9.27%.

India at 75 to India at 100

Union Budget 2022-23 seeks to lay the foundation, providing a blueprint of the economy over ‘Amrit Kal’ of next 25 years from India at 75 to India at 100.

Capital Expenditure

  • Effective Capital Expenditure (CapEx) of Central Government is estimated at Rs 10.68 lakh crore in 2022-23
  • It is about 4.1% of GDP. 
  • FY23 CapEx target: Rs 7.50 lakh crores.

Fiscal Deficit

  • Fiscal Deficit for FY22 is pegged at 6.9% from 6.8% in FY21.
  • Fiscal deficit target for Fiscal Year 2022-23 (FY23): 6.4% of GDP, which is above expectations.

Four Pillar Approach

PM Gati Shakti Masterplan

  • It is a National Master Plan for Multi-modal Connectivity that intends to bring together 16 infrastructure related Ministries.
  • PM Gati Shakti will encompass 7 engines for multi-modal connectivity to facilitate faster movement of people & goods including railways, roads, ports, airways, etc.
  • It will enrich the economy, create jobs and opportunities for the youth.
  • Roadways: National Highways (NH) Network to be expanded by 25000 Km in 2022-23 with Rs 20,000 crores finance mobilization.
  • Logistic Parks: Four Multimodal Logistics Parks will be implemented through PPP mode in 2022-23
  • Railways: 
    • 'One Station One Product' to help local businesses & supply chains.
    • Railway network of 2000 Km to be brought under Kavach, indigenous world class technology and capacity augmentation in 2022-23.
    • 400 new generation Vande Bharat Trains to be manufactured in the next three years.
    • 100 Cargo Terminals under PM Gati Shakti will also be developed in the next few years.
  • Parvatmala (National Ropeways Development Program): Contracts for 8 ropeway projects of 60 Km length will awarded in 2022-23 on PPP mode.

Inclusive Development

Farmers and Agriculture

MSP:

  • Rs 2.37 lakh crores will be given as direct payment of MSP to farmers
  • Procurement of wheat in Rabi season 2021-22 and estimated procurement of paddy in Kharif season 2021-22 will cover 1,208 lakh metric tonnes of wheat and paddy from 163 lakh farmers

Agriculture financing:

  • Funds with blended capital raised under co-investment model to finance start-ups in agriculture and rural enterprises for farm produce value chain will be set up.
  • They will be facilitated through NABARD

Agricultural Education: States will be encouraged to revise agricultural universities syllabi to meet needs of natural, zero-budget and organic farming, modern-day agriculture.

Use of drones:

  • Drones will be used for crop assessment, digitization of land records, spraying of insecticides and nutrients.

Other Areas

  • NABARD will provide funds to finance start-ups for agriculture and rural enterprise for the farm produce value chain.
  • Chemical-free Natural Farming will be promoted.

Ken Betwa project

  • Outlay: Rs 1400 crore.
  • It will provide irrigational benefits to 9.08 lakh hectares of farmers’ lands.

MSME

  • Interlinking of Udyam, e-shram, NCS and ASEEM portals
  • Emergency Credit Linked Guarantee Scheme (ECLGS):
    • Additional credit to 130 lakh MSMEs
    • It will be extended up to March 2023.
    • Guarantee cover to be expanded by Rs 50000 Crore to Rs 5 Lakh Crore.
  • Additional credit of Rs 2 lakh crore for Micro and Small Enterprises to be facilitated under Credit Guarantee Trust for Micro and Small Enterprises (CGTMSE).
  • Raising and Accelerating MSME performance (RAMP) programme to be rolled out with outlay of Rs 6000 Crores.

Skill Development

  • Digital Ecosystem for Skilling and Livelihood (DESH-Stack e-portal) will be rolled out
  • Startups will be promoted for ‘Drone Shakti’ and Drone-As-A-Service (DrAAS).

Education

  • PM eVIDYA’s ‘One class-One TV channel’ programme to be expanded to 200 TV channels.
  • Virtual labs and skilling e-labs to be set up.
  • High-quality e-content to be developed for delivery through Digital Teachers.
  • Digital University for world-class quality universal education to be established.

Health

  • National Digital Health Ecosystem platform to be rolled out.
  • National Tele Mental Health Programme for counselling and care services to be launched.
  • Network of 23 tele-mental health centres of excellence will be set up, with NIMHANS as nodal centre and International Institute of Information Technology-Bangalore (IIITB) providing technology support.
  • Two lakh anganwadis will be upgraded to Saksham Anganwadis.

Har Ghar, Nal Se Jal

  • Outlay: Rs. 60,000 crores.
  • Will cover 3.8 crore households in 2022-23

Prime Minister’s Development Initiative for North-East Region (PM-DevINE)

  • Aim: to fund infrastructure and social development projects in the North-East.
  • Rs. 1,500 crores allocated initially.

Banking

  • 5 lakh post offices to come under core banking system.
  • Scheduled Commercial Banks to set up 75 Digital Banking Units in 75 different districts.

 e-Passport

  • e-Passports with embedded chip and futuristic technology features to be rolled out.

Urban Planning

  • Modernization of building byelaws, Town Planning Schemes, and Transit Oriented Development will be implemented.
  • Battery swapping policy will be rolled out

Land Records Management

  • Unique Land Parcel Identification Number will be provided for IT-based management of land records.

Productivity Enhancement & Investment, Sunrise Opportunities, Energy Transition, and Climate Action

Accelerated Corporate Exit

  • Centre for Processing Accelerated Corporate Exit (C-PACE) to be established

Telecom Sector

  • Scheme for design-manufacturing to be launched strong for 5G as part of the Production Linked Incentive Scheme.

Export Promotion

  • Special Economic Zones Act to be replaced with new legislation to enable States to become partners in ‘Development of Enterprise and Service Hubs’.

Defence

  • Sector observed 68% of capital procurement earmarked for the domestic industry in 2022-23
  • Defence R&D to be opened up for industry, startups and academia with a 25% defence R&D budget earmarked.
  • For meeting testing and certification requirements, an Independent nodal umbrella body will be set up

Sunrise Opportunities

  • Sunrise Opportunities: Artificial Intelligence, Geospatial Systems and Drones, Semiconductor and its eco-system, Space Economy, Genomics and Pharmaceuticals, Green Energy, and Clean Mobility Systems.
  • Govt will contribute to its R&D

Energy Transition and Climate Action:

  • Additional allocation of Rs. 19,500 crores for Production Linked Incentive (PLI) for the manufacture of high-efficiency solar modules to meet 280 GW goal of installed solar power by 2030.
  • 5 to 7% biomass pellets to be co-fired in thermal power plants that will reduce CO2 emission, provide extra income to farmers and held in avoiding stubble burning.
  • Financial support to farmers belonging to Scheduled Castes and Scheduled Tribes for agro-forestry.

 Financing of investments

Public Capital Investment

  • Public investment continues to pump- private investment and demand in 2022-23.
  • The outlay for capital expenditure stepped up by 35.4% to Rs. 7.50 lakh crore in 2022-23 from Rs. 5.54 lakh crore in the current year.
  • The outlay in 2022-23 to be 2.9% of GDP.

Digital Rupee

RBI to introduce Digital Rupee in 2022-23.

GIFT-IFSC

  • World-class foreign universities and institutions to be established in the GIFT City.
  • International Arbitration Centre to be set up for timely settlement of disputes

Mobilising Resources

  • Data Centres and Energy Storage Systems to be upgraded to infrastructure status.
  • Venture Capital and Private Equity investment to be scaled up
  • Blended funds to be promoted for sunrise sectors.
  • Sovereign Green Bonds for mobilizing resources for green infrastructure to be issued

 

Greater Fiscal Space to States

  • Enhanced outlay for ‘Scheme for Financial Assistance to States for Capital Investment’ from Rs. 10,000 crore in Budget Estimates to Rs. 15,000 crore in Revised Estimates for current year
  • States will be allowed fiscal deficit of 4%, of which 0.5% will be tied to power sector reforms in 2022-23.

Official Data of Expenditure and Revenue

Revenue Comes From

byjusexamprep

 

Expenditure Goes to

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Tax Proposals

Direct Tax

  • New updated return: Here people can file updated return within 2 years of filed IT Return.
  • Cooperative societies:
    • Alternate minimum tax reduced for cooperatives from 18.5% to 15%.
    • Surcharge of cooperative societies reduced from 12% to 7% for those having income of more than 1 crore and up to Rs 10 crores.
  • Tax Benefits to startups: Existing tax benefits for Startups to be extended by 1 more year till 2023.
  • Tax relief to persons with disability: Payment of annuity and lump sum amount from insurance scheme to differently abled dependent during lifetime of parents/guardians, i.e., on parents/ guardian attaining the age of 60 years.
  • Parity in National Pension Scheme (NPS) Contribution
    • Tax deduction limit increased from 10% to 14% on employer’s contribution to the NPS account of State Government employees.
    • Brings them at par with central government employees.
  • Virtual digital assets:
    • They will be taxed at 30%.
    • Loss from the transfer of virtual digital assets cannot be set off against any other income.
    • TDS on payment made in relation to the transfer of virtual digital assets is at the rate of 1%.
    • Gift of the virtual digital asset will also to be taxed in the hands of the recipient.
  • Tax incentives to IFSC:
    • Income of non-residents from offshore derivative instruments.
    • Income from over the counter (OTC) derivatives issued by an offshore banking unit.
    • Income from royalty and interest on account of lease of ship.
    • Income received from portfolio management services in IFSC.
  • Surcharge
    • Surcharge on Association of Persons (AOPs) capped at 15%.
    • Surcharge on long term capital gains on transfer of any type of assets capped at 15%.
  • Health and Education Cess: Any surcharge or cess on income and profits not allowable as business expenditure.
  • Discouragement against tax evasion: Budget discourages tax invasions and allow any loss against undisclosed income detected during search and survey operations.

Indirect Tax

  • GST: GST revenues goes buoyant despite the pandemic. Gross GST collections for the month of January 2022 is Rs 1,40,986 crore, which is the highest since the inception of the tax in 2017
  • Special Economic Zones: Customs Administration of SEZs to be fully IT driven and Customs National Portal will be implemented by 30th September 2022.
  • Customs Reforms and duty rate changes
  • Faceless Customs service has been fully established. 
  • Certain exemptions for advanced machineries that are not manufactured within India shall continue.
  • Few exemptions introduced on inputs, like specialized castings, ball screw and linear motion guide will encourage domestic manufacturing of capital goods.
  • More than 350 exemption entries to be gradually phased out.
  • Electronics: Duty concessions to parts of transformer of mobile phone chargers and camera lens of mobile camera module and certain other items.
  • Gems and Jewellery: Customs duty on cut and polished diamonds and gemstones has been reduced to 5% and Nil customs duty to simply sawn diamond.
  • Customs duty exemption for steel scrap extended for one more year.
  • Unblended fuel to attract an additional differential excise duty of Rs 2 per litre from 1st October 2022.

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FAQs

  • The Union Budget 2022-23 tabled by Finance Minister Nirmala Sitharaman.

  • RK Shanmukham Chetty (then finance minister) presented Independent India's first Budget on 26th November 1947.

  • Four times union budget was presented by Nirmala Sitharaman.

  • 4 pillars,

    • PM Gati Shakti
    • Inclusive development
    • Productivity Enhancement & Investment, Sunrise Opportunities, Energy Transition, and Climate Action
    • Financing of investments


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