Top 5 Union Budget 2024 Highlights

Outlining the country’s economic vision, Finance Minister Nirmala Sitharaman has tabled the Union Budget 2024 aimed at boosting investment and consumption, spurring innovation and generating employment opportunities for millions of youth through skill development. 

Here’s a look at the highlights of the Union Budget:

✅Key Takeaways -

• Credit access for MSMEs to promote ‘Make in India’ initiative 
• Corporate tax reduction for foreign firms and angel tax scrapped 
• Import duty cuts on minerals to boost manufacturing in strategic sectors
• Multiple agricultural initiatives to drive India’s rural economy 
• Restructuring of capital gains tax to bring uniformity in tax laws

➡️Credit Schemes for Manufacturing 

To boost the MSME sector which forms a major source of employment, credit guarantee schemes have been announced, allowing manufacturing businesses to avail loans without collateral or third-party guarantee. Additionally, a self-financing guarantee fund has been established to provide additional guarantee cover of up to Rs. 100 crore to each applicant. For micro-businesses, mudra loan limits have been raised from 10 lakh to 20 lakh. 

➡️Investment and Innovation 

Addressing the long-standing demand of foreign firms investing in India, the government has reduced the corporate tax levied on them from 40% to 35%. To boost the startup ecosystem, the angel tax has been abolished across all investor classes, paving the way for innovation.

➡️Import Duty Cuts

Providing a huge fillip to boost domestic production in strategically important sectors like nuclear energy, defence and high-tech electronics industry, the government has fully exempted customs duties on 25 critical minerals. In a major relief to India’s famed jewelry industry, custom duty on gold and silver has been reduced to 6% which will help reduce jewelry prices and lift demand. 

➡️Agricultural Productivity 

Given that agricultural productivity and rural consumption are interconnected, the government has an outlay of 1.52 lakh crore to boost farm incomes and drive rural consumption. Initiatives like natural farming, agricultural research to develop climate-resilient seed varieties, strengthening vegetable and fruit supply chains as well as making India self-sufficient in pulses and oilseed production are vital steps to meet domestic demand and promote agro-exports. 

➡️Capital Gains Tax Restructured 

To ramp up tax collections, the Long Term Capital Gains tax (LTCG) has been hiked from 10% to 12.5% while the Short Term Capital Gains (STCG) tax is increased from 15% to 20% on certain assets. To bring uniformity in tax laws, LTCG on the sale of real estate will also attract a 12.5% tax, a reduction of 7.5% from the existing 20%. However, the government has discontinued the indexation benefit on the sale of real estate, thus it has received mixed responses from experts. 

➡️Skill Development 

The government has allocated a budget of 2 lakh crore to provide employment to 4.1 crore youth, with a push towards skill development, internship and incentives for first-time job seekers through Direct Benefit Transfer. The upgradation of 1000 Industrial Training Institutes has also been planned to prepare youth for jobs in the industry.