Page 25 - DHC Budget Book 2021-22 Final

Overview
2021 marks the start of the 75th year of Independence, 60 years of Goa’s accession to India, 50 years of the 1971 India-Pakistan War and year of the 1st Digital Census. Besides, the year will mark India’s turn at the BRICS Presidency, India’s Chandrayaan-3 Mission and the Haridwar Maha Kumbh.
The fiscal deficit for 2020-21 has been estimated at 9.5% of GDP and for 2021-22 at 6.8%.
The numbers projected by the Hon’ble Finance Minister comprised:
— For 2020-21, RE for expenditure was estimated at H 34.50 lakh Crs.
— For 2021-22, BE for expenditure was estimated at H 34.83 lakh Crs. (H 5.54 lakh Crs. as capital expenditure, an increase of 34.5% over the BE figure of 2020-21).
— Projected gross borrowing for 2021-22 expected at around H 12 lakh Crs..
On the taxation front, the Budget focussed on a trust-based system and compliance ease. Various proposed measures comprised the scrapping of income tax return filing requirement for senior citizens under certain conditions, provisions for granting relief from double taxation for NRIs and extension by a year of tax holiday for start-ups.
The Budget proposed amendments to IFSCs to incentivise the setting up of units in IFSC. The Budget proposed a faceless Income Tax Appellate Tribunal to simplify the appellate procedure. Measures proposed for non-filers of income tax returns by imposing higher tax rates for deduction/ collection.
To promote digital transactions, the limit for
tax audits under section 44AB proposed to be increased from H 5 Crs. to H 10 Crs. where 95%
of transactions are digitised. The budget also proposed clarifications to remove ambiguity around the applicability of Equalisation Levy 2.0.
Indirect Tax reforms have been directed to build an AtmaNirbhar Bharat, strengthen the ‘Make in India’
movement and enhance GST user-friendliness. The introduction of deterrent provisions will discourage defaulters at both ends of the transaction from GST misuse (illegal credit, fake invoicing etc.).
The imposition of Agriculture Infrastructure and Development Cess (AIDC) on imports will help develop agriculture infrastructure. The Budget speech clarified that the Government had taken care to not impose additional burden on consumers due to application of AIDC (achieved by way of a corresponding decrease in Basic Customs Duty on goods on which AIDC was levied).
Some changes proposed to be made in Customs Duty; including a roadmap for prospective rate changes to maximise India’s share of the global value chain and enhance exports volume. The proposed introduction of Customs Common Electronic Portal is likely to enhance the ease of doing business in India.
Proposed GST amendments will help settle lingering disputes between the Revenue department and taxpayers. One such amendment provides that members or constituents of an AOP are persons distinct from the Association, club etc. To ensure that Input Tax Credit is available only for genuine transactions, the furnishing of Invoices & Debit Notes by suppliers in GSTR-1 is now proposed to
be a pre-condition for the recipient to avail Input Tax Credit. A mandatory GST audit proposed to
be replaced by the submission of a self-certified reconciliation between the books and returns to enhance functional ease. The Budget indicated that GST changes would be progressively taken to make the law simpler.
Union Budget 2021 promised to focus on AtmaNirbhar Bharat and Ease of Doing Business.
This is expected to translate into economic revival, modernised industry, doubled farmers’ income, stronger infrastructure, women’s empowerment, healthy India, good governance, education for
all, jobs for the youth and ease of compliance for citizens and businesses.
In short, a blueprint for a confident and resilient India.
Content
Foreword Basic 23