I. Tax proposals 2019-2020 for Individuals

  1. Income Tax slabs will remain the same for FY 2019-20.
  2. No tax on notional rent of second Self-occupied House under “Income from House Property” i.e. up to two self-occupied house properties to be considered for exemption.
  3. Tax Rebate Limit under 87A increased from Rs. 3.5 lakhs to Rs. 5 lakhs for taxpayers. The maximum limit of the tax rebate increased to Rs.12,500 from the present limit of Rs. 2,500. This means that anyone with net taxable income up to Rs 5 lakh will not be required to pay any taxes. However, anyone with net taxable income above Rs 5 lakh will not be able to avail this tax benefit.
  4. TDS limit under Section 194A (TDS on Interest other than Interest on Securities) hiked from Rs 10,000 to Rs 40,000 on Post Office Savings and Bank Deposits.
  5. Standard Deduction for the salaried class increased from Rs 40,000 to Rs 50,000.
  6. Under section 54 of the I-T Act, to save on the capital gains made on the sale of a residential property, one is currently allowed to invest only in one other house property. Budget 2019 has proposed to relax the condition required to be met to save on capital gains made on the sale of a residential property. The benefit of rollover of capital gains under section 54 of the Income Tax Act will be increased from investment in one residential house to two residential houses for a tax payer having capital gains up to Rs 2 crore. This benefit can be availed once in a life time.


II. Tax proposals 2019-2020 for Businesses, MSME & Real estate

  1. Benefits under Section 80-IBA to be extended for one more year – to the housing projects approved till 31 March 2020.
  2. Period of exemption from levy of tax on notional rent, on unsold inventories is extended from one year to two years, starting from the end of the year in which the project is completed.
  3. SMEs with earnings below Rs 5 Crores will soon file GST returns only once in 3 months.
  4. MSMEs and Traders to note that GST Registered SME units will get 2% interest rebate on an incremental loan of Rs. 1 Crore.
  5. The requirement of sourcing from SMEs by Government enterprises has been increased to 25% with 3% reserved for women-owned SMEs.
  6. A scheme of ‘Business loans up to Rs. 1 crore in 59 minutes’ will be implemented.
  7. Limit to deduct TDS on Rent under Section 194I has been increased from Rs 1,80,000 to Rs. 2,40,000.


III. Measures for the poor and backward class
Rs 60,000 crores are being allocated for MGNREGA in Budget Expenditure 2019-20. Additional amount would be provided if required.


IV. Women Empowerment

  1. Providing cleaner fuel for rural women – out of the 8 crores promised free LPG connections, 6 crore is already delivered under Ujjwala Yojana and remaining will be delivered in the coming year.
  2. More than 7,000 beneficiaries of PM Mudra Yojana are women. 15.56 crore loans of ₹7.23 lakh crore disbursed under MUDRA Yojana.
  3. Benefits of maternity leave of 26 week have provided support to women.


V. Banking Reforms & Insolvency and Bankruptcy Code (IBC)

  1. Outstanding loans of public sector banks increased from Rs 18 lakh crore to Rs 52 lakh crore. Under the clean banking initiative, the 4R approach- Recognition, Resolution, Recapitalisation, Reforms is being followed.
  2. Three banks namely Bank of India, Bank of Maharashtra and Oriental Bank of Commerce are out of Prompt Corrective Action (PCA)
  3. 8 public sector banks still remain within PCA framework which imposes restrictions on lending and expansion.
  4. IBC has instituted a resolution-friendly mechanism to speed-up recovery of NPAs. Consequently, Rs 3 lakh crore has already been recovered to this effect.
  5. A sum of Rs 2.6 lakh crore has been directed towards recapitalisation of Public Sector Banks (PSBs).
  6. Amalgamation of banks in place to avail economies of scale, better capital and wider geographical coverage.


VI. Positive disruptions in Pension Sector

  1. Benefits to 10 crore workers in the unorganised sector as part of the Mega Pension Yojana.
  2. Contribute Rs. 55-100 per month and govt will contribute the same – to get Rs. 3000 pension monthly post 60 under Pradhan Mantri Shram Yogi Mandhan Yojana.
  3. Over Rs. 35,000 crore has been allocated under the ‘One Rank One Pension’ scheme for Defence personnel.
  4. Rs. 500 crore allotted for pension schemes for individuals in other sectors.
  5. NPS rules amended in December are implemented- with increased Government contribution from 10% – 14%.


VII. Agricultural Reforms

  1. Minimum Support Price (MSP) fixed at 50% more than the cost for all the 22 crops.
  2. Pradhan Mantri Kisan Samman Nidhi (PM-kisan) to benefit around 12 crore small and marginal farmers with a direct income support of Rs 6000 annually. Rs 75,000 crore has been allocated towards this.
  3. The amount of interest subvention has been doubled, crop loans to farmers increased to Rs 11.68 lakh crore.
  4. Allocation for Rashtriya Gokul Mission increased to Rs 750 crore. Rashtriya Kamdhenu Aayog has been established to genetically upgrade cow resources.
  5. Under Kisan Credit Card scheme, farmers pursuing animal husbandry and fisheries will get 2% interest subvention. An additional 3% interest subvention will be provided for timely loan repayment.
  6. Under National Disaster Relief Fund (NDRF), farmers affected by natural calamities will get 2% interest subvention. A prompt repayment incentive of 3% will be given for entire loan reschedulement period.


VIII. Other Announcements / Provisions

  1. Tax free gratuity limit proposed to be raised from Rs 20 lakh to Rs 30 lakhs.
  2. Returns filed with increased 80% tax base in the last financial year
  3. 99.84% returns filed in the last FY processed without scrutiny. Going further target of processing filed returns within 24 hours

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