Listen to the article
While the country is being steered towards global economic growth, is the average citizen being snubbed by taxes, again?
While the country is being steered towards global economic growth, is the average citizen being snubbed by taxes, again?
Amidst the ongoing third wave of COVID-19, the Union Budget 2022 sets a defining way forward for the Indian economy. Every common man’s attention will be drawn to the cheap and expensive, as well as the impact of this budget on his pocketbook, in the Budget 2022. Finance Minister Nirmala Sitharaman officially launched a Rs 39.45 lakh crore Budget 2022, with increased spending on highways and affordable housing to rev up the economy’s key engines and sustain a world-beating recovery from the pandemic. Sitharaman did not change income tax slabs or tax rates while ramping up infrastructure spending to create jobs and boost economic activity. Industry experts, market watchers, and the common man have expectations that collectively focus on economic revival and tax relief. Were those expectations met? From taxation points to important returns, here are all of the major takeaways from the Union Budget 2022 for you to consider.
Economic Growth Per The Union Budget 2021-2022
The Union Budget presented by Finance Minister Nirmala Sitharaman is paving the way for India to be on par with globally competitive and advanced countries. The Economic Survey suggests that economic growth is resilient at 9.2% in 2021-2022. The International Monetary Fund (IMF) also bears testimony to this with 9% GDP growth projections, making India the fastest growing economy in the world.
Capital expenditure growth increased by 35.4% to INR 7.50 lakh crore in FY23, from INR 5.54 lakh crore in FY22. Overall, there’s a 30% Capex growth over FY21 showing a nod of approval for the investment-led growth approach over consumption-led growth. India, like many other countries, adopted the consumption-led approach in 2008 to recover from the global financial crisis. This led to a period of high inflation in the country making it abundantly clear that this approach is not sustainable in India. After learning from past mistakes, the country is dedicated to taking an investment-based approach as a response to the pandemic. As one of the benefits of this approach, the Emergency Credit Line Guarantee Scheme (ECLGS) increased by INR50,000 crores to INR 5 lakh crore, extended till March 2023.
The fiscal deficit for FY22 grew from 6.8% to 6.9%, further estimated to reach 6.4% in FY23. This also indicates the government’s focus on investment-led growth and realism, keeping the ongoing impact of COVID-19, geopolitical challenges, and the upcoming rate hike cycle.
Any Tax Break For The Common Man?
Hailed by experts for its focus on growth and investment, nothing has changed in terms of personal taxation and existing tax slabs. However, there is a big change for people who are riding the wave of digital assets like cryptocurrencies and NFTs.
For any income incurred from the transfer of digital assets like Bitcoin and Ethereum, the income tax levied will be at the rate of 30% plus surcharge and cess. This is of great significance as India has approximately 20 million investors with estimated investments that amount to US$10 billion.
With regards to income tax returns, the budget has proposed to introduce an “updated tax return” under Section 139(8A). This will enable taxpayers to revise their tax returns and file the updated returns within two years from the end of the assessment year. This measure reduces tax litigation and helps people who have not reported income.
Job Creation As A Priority
The Finance Minister announced the Production Linked Incentive Scheme for Atmanirbhar Bharat that will create 6 million jobs in 14 sectors, with additional emphasis on Solar PV module manufacturing. If executed well, this will promote job combustion that the country needs, faring well for the youth and the economy. The reduction of several compliances, repealing union laws, one nation – one registration scheme, interlinking Udhyam, E-shram, NCS, ASEEM portals to create a seamless workflow are motivating factors for employers and the workforce. Tax exemption for startups till March 2023 and focus to develop FinTech and digital economy welcomes the ambition of rapid urbanization.
Union Budget Highlights
Here are the key takeaways from India’s new finance budget.
General Announcements:
- Gross GST collections have reached a record of INR 1.41 trillion, the highest since 2017.
- RBI backed digital rupee using blockchain will be launched in FY23
- INR 48,000 crore allocated to housing projects under PM Housing Scheme for FY23
- 75 digital banking systems will be set up in 75 districts by scheduled commercial banks
- Post offices will now have core banking services
- Concessional duty on import of capital goods to be gradually removed
- 68% of capital outlay for the domestic defense industry
- Issuance of e-Passports using embedded chips for convenience travel
- Push for electric vehicles by battery swapping policy
- Preparations to roll out 5G
Taxation Announcements:
- No change in tax rates, wealth tax, and inheritance tax.
- Considerable reduction in the surcharge for long-term capital gains, from 28.5% to 23.92%.
- No change in corporate tax rates
- Beneficial tax rate of 15% on corporates on foreign dividends discarded
- Surcharge on long-term capital gains set at 15%
- 1% TDS on transfer of virtual assets and income earned from cryptocurrencies and NFTs to be taxed at 30%
Union Budget 2022 FAQ’S:
Who presents the Union Budget 2022-23?
Finance Minister of India Nirmala Sitharaman will present the Union Budget for the fourth time in a row on February 1, 2022.
What is the key focus of Budget 2022 – 23 for the real estate sector?
Budget 2022 focuses to improve ease of business and make the real estate sector more transparent, highlighting its role to boost the Indian economy.
What is the theme of the union budget 2022-23?
The theme of this year’s Union Budget is to increase employment generation, promote ease of business, digitize the banking sector to reach rural India, and trump inflation with growth policies.
Related Articles
Exploring REITs? Here Are The 3 REITs Listed In India & How To Invest
Most would not have gone for REITs investing a decade or so. But, REITs have grown in appeal among institutional and ordinary investors, especially with the positive prospects surrounding future office space expansion.
Real Estate Crowdfunding: What is it And How It Works?
Real estate crowdfunding is often used to increase and diversify one’s financial holdings while maintaining an overall balanced portfolio of financial investments, including stocks, bonds, and other equity holdings, rather than as a major means of generating wealth.
Dividend Income or Passive Income From Real Estate – What’s Worth It?
This article mainly explains about the dividend and passive income that is generated from real estate investments. Read more to know about which type of income is best from investing in real estate properties.
Real Estate Investing – How Much Will The Sector Grow Till 2030?
There is no doubt that the real estate sector is growing like anything in India. After Covid 19 situation the industry is experiencing an increase in demand for many commercial and residential buildings. This blog gives us a clear idea of what real estate industry growth is going to be till 2030.
How To Calculate Yield For All Types Of Real Estate Investments In India
Rental yield may be measured in two ways: gross rental return and net rental return. The gross rental yield is the yearly rental revenue derived from the property valuation, excluding expenditures for property upkeep and taxes. It’s just the amount of money you make in rent each year.
Is Office Space Still A Worthy Real Estate Investment In The Work From Home World?
The market appears to be improving, with lease activity picking up in the top seven cities in 2021. Many offices already have opened, and many more are expected to start soon. As a result, this is an excellent moment to invest in commercial real estate.
What Drives The Price Of A Commercial Asset in Real Estate Investment?
A main real estate market driver is a primary force that positively impacts the market. If a market driver is available, there is a good chance that favorable market or industry trends will emerge. Values may rise, and demand may increase.
FEMA Regulations For NRI Real Estate Investments in 2022
This blog gives us a brief idea about the FEMA regulations that are required for NRI real estate investments in 2022.
What Is The Minimum Amount For Real Estate Investment Online In India
Nowadays small investors are coming forward to make profits with a minimum amount of investment in Indian real estate online. This blog gives them a clear idea of the various methods present in real estate investments.
How To Create A Tax-Smart Portfolio With NRI Real Estate Investments
These are the numerous investment opportunities available to NRIs in India. This article helps the NRIs to understand the different methods where they can be able to create tax-smart portfolio with their investments.
India Among The Top Flexible and Cost Efficient Office Locations in the World: Report
The rise of India as a startup powerhouse has also boosted the demand for flexible spaces. They’ve reimagined their products and repositioned themselves to be more relevant in today’s changing environment.
What Makes Real Estate Investment In India The Most Profitable Investments For NRIs?
There are different types of real estate investments present in India which can make NRI investments profitable within a short span of time. This blog gives you clear info on how the investments are being Profitable for NRIs.
JLL reports India real estate garnered $943 million in investments worth in Q1 2022
JLL India has reported that the Indian real estate sector has attracted investments of worth $943 million in Q1 2022 which is 41 percent more compared to the previous quarter.
10 Real Estate Investing Terms To Understand Before Talking To An Agent
Real estate investing may be expensive. However, if you do it correctly, you might earn a sizeable chunk of passive income from rental as the property appreciates. That is why it is critical to comprehend the main terminology of real estate investment.
RBI Rules & Permissions For NRI Investments In India Real Estate
The RBI provides guidelines from time to time outlining the legislation and granting broad authority to NRIs to acquire certain immovable assets in India without needing additional approval from the RBI.
Navigating Marketing Volatility In Real Estate Investment Via Fractional Ownership
Financial markets enjoyed a wild journey in 2022, with sharp ups and downs in stock and cryptocurrency valuations. While real estate with fractional ownership has always been a solid basis in every good portfolio
The Right Way To Measure The Performance Of A Real Estate Investment
This article gives an overview of real estate performance measurement. Property valuation is more difficult than other types of asset appraisal because it lacks specific published values.
Over 2.5 Fold Jump in Office Leasing For Delhi-NCR During The First Quarter: Report
With this report we can clearly observe a 2.5 fold jump in leasing office spaces in Delhi NCR region with in the first Quarter of 2022.
Institutional Investments To Touch $1.1 Billion In The First Quarter of 2022: Report
Institutional investments in Indian property investment reached 1.1 billion in Q1 2022, more than doubling from the same period last year.
As Property Prices Rise In India, The Real Estate Industry Needs Fractional Ownership Now More Than Ever
Across the country, prices are likely to rise by 10-15%. According to our poll, 65 percent of developers believe that prices would increase by 10%. The impact would be the greatest on the inexpensive housing market.
