RBI GRADE B PHASE 2 ESI FM STUDY MATERIAL 2020:Budget 2020 - 21 Highlights
RBI GRADE B PHASE 2 ESI FM STUDY MATERIAL 2020
👉Economy and Finance:
🔸A new tax regime has been announced. But, this is optional in nature. The new regime is applicable to individuals who would opt out of the rebates-based old regime. The old regime is still there. If anyone wants to continue taking exemptions (deductions to bring down their taxable income), they will have to pay a higher tax rate(old regime). However, the ones opting out can benefit from lower tax rates. This is a move towards a cleaner and simpler tax structure.
🔸Bank deposit insurance cover has been increased from 1 lakh to 5 lakh. In the event of the bank run, people have improved financial security. This reform was long pending. In light of the ailing banking sector, this move will boost savings and deposit rates.
🔸A new Vivad se Vishwas scheme has been proposed. This is to settle litigation pertaining to direct taxes. The penalty and interest charges due to delay are waived off if taxpayers pay the tax demanded by 31st March 2020.
🔸This scheme covers individuals as well as companies. There are more than 500,000 cases, with a total tax demand of about Rs 8 lakh crore, pending in courts and quasi-judicial forums for years. It would take a long while before the tax department gets the money — that is if it eventually wins the cases. So, this is a win-win for either party.
🔸Civil offences are to be decriminalized by amending the Companies Act. This has been done to improve the business environment. Offences that could be decriminalized would include corporate social responsibility (CSR) violations and non-filing of returns.
👉Agriculture:
🔸The agriculture sector has gotten a budgetary allocation of 2.83 lakh crores. This is in consonance with efforts to tackle farmers distress and improve the agricultural growth which has remained stagnant at around 3%.
🔸A new Krishi Udaan scheme under Aviation ministry for transportation of agri-products has been announced. This is a forward linkage measure to improve price-realization for agri-products.
👉Health and Sanitation:
🔸The allocation for healthcare has increased from 62000 crores to 69000 crores.
🔸Expansion of AB-PMAY is to be done with more hospitals under PPP model in Tier II and Tier III cities
👉Education:
🔸Efforts will be made to bring FDI and ECBs in this sector. This has been done to improve the higher education and research ecosystem by attracting talents. Thus, the focus remains on innovation.
🔸Apart from other regular announcements, the proposal for a national police university and a national forensic science university stands out.
👉Infrastructure:
🔸1.7 lakh crores have been proposed for transport infrastructure in 2021. This is in line with our global commitments to cut down carbon emissions.
🔸Logistics sector remains in poor state. The cost of logistics in India is 14% of the GDP which is far higher as compared to other countries. Thus, a national logistics policy will be announced to bring down logistics costs for global competitiveness. This will have a spillover effect over a large number of sectors- agriculture, industry, exports in terms of reduced input costs and better price-realization for output.
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