The Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman made her maiden Budget Speech on 5th July,2019 and presented the Union Budget 2019-20 before the Parliament. 

As expected the budget has brought several remarkable provisions for the Indian startup ecosystem. One of the most important moves is that of easing out the much-debated ‘angel tax’. Smt. Nirmala Sitharaman also proposed a system of e- verification of investors and the source of investor’s funds. 

The key highlights on the Union Budget 2019-20 presented on 5th July 2019 are as follows:

Major Expenditure Items:

1. Total capital expenditure will be Rs 876,209 crore (US$ 131.43 billion) for 2019-20.
2. Centrally sponsored schemes have been allocated Rs 331,610 crore (US$ 49.74 billion) in 2019-20.
3. Defence budget is Rs 305,296 crore (US$ 45.79 billion) for the first time in 2019-20.
4. Amount of Rs 174,300 crore (US$ 26.14 billion) has been approved for pension in the budget 2020.
5. The government has allocated Rs 184,220 crore (US$ 27.63 billion), Rs 79,996 crore (US$ 11.99 billion) and Rs 37,478 crore (US$ 5.62 billion) for Food, fertiliser and Petroleum subsidies respectively.

Direct Tax:

1. Interest deduction on housing loan under Section 80EEA increased by 1.5 lakh for home loans taken on self-occupied house property by 31/3/2020, houses with the cost of Rs 45 lacs will be eligible for this
2. To make Aadhaar, PAN interchangeable to file tax returns. Tax return can be filed using Aadhar Number!!
3. To discourage cash payments TDS@ 2% on withdrawals exceeding 1Cr per annum from a bank account.
4. Surcharge for individuals having taxable income from Rs 2 crores to Rs 5 crores increased to 25% and for individuals having taxable income from Rs 5 crores to Rs 10 crores increased to 37% – FY 2019-20
5. Faceless and anonymous assessment system for income tax being rolled out this year in phases.

Infrastructure/ Industries:

1. To set up panel on long-term funding for infrastructure Need to invest heavily in infrastructure
2. Ministry of Railways have been allocated Rs 94,071 crore (US$ 14.11 billion) in 2019-20.
3. The government has suggested the investment of Rs 5,000,000 crore (US$ 750 billion) for railways infrastructure between 2018-2030.
4. Metro rail network has reached to 657 Km.
5. Operating ratio improved by 95 per cent in Union Budget 2019-20.
6. Government has announced to invest Rs 10,000,000 crore (US$ 1.5 trillion) in infrastructure over the next five years
7. To upgrade 1,25,000 kms of road length over the next five years, the estimated cost of Rs 80,250 crore (US$ 12.03 billion) is envisaged under Pradhan Mantri Gram Sadak Yojana-III (PMGSY)
8. 30,000 kms of PMGSY roads have been built using Green Technology, Waste Plastic and Cold Mix Technology.
9. Government has ensured power availability to states at affordable rates through model – One Nation, One Grid.
10. Government has proposed to permit investments made by Foreign Institutional Investors (FIIs)/Foreign Portfolio Investments (FPIs) in debt securities issued by Infrastructure Debt Fund.
11. Road – Bharatmala phase 2 going to be launched to develop the state road networks.
12. Government has finalised the model tendency law- promotion of rental housing.

FARM SECTOR:

1. The government is planning to form 10,000 new Farmer Producer Organizations, to ensure economies of scale for farmers over the next five years.
2. The government will work with State Governments to allow farmers to benefit from e-NAM (National Agriculture Market).
3. The government might replicate “one count: Zero Budget Farming” model which can help in doubling our farmers’ income in time for our 75th year of Independence.
4. The focus of the government is on the “Pradhan Mantri Matsya Sampada Yojana” (PMMSY) for addressing critical gaps in the value chain, including infrastructure, modernization, traceability, production, productivity, post-harvest management, and quality control.

Micro, Small and Medium Enterprises (MSMEs) and Traders:

1. Government has proposed granting of loans up to Rs 1 crore (US$ 0.15 million) for MSMEs within 59 minutes through a committed online portal. Under the Interest Subvention Scheme for MSMEs, Rs 350 crore (US$ 52.50 million) has been allocated for FY 2019-20
2. Government will create a payment stage for MSMEs to enable filing of bills and payment thereof on the platform itself.
3. The Government e-Marketplace (GeM) is being extended to all Central Public Sector Enterprises (CPSEs), providing more opportunities for MSMEs to sell their products.

Labour and Youth Welfare:

1. National Sports Education Board to be setup under Khelo India to prepare youth for new age skills, Artificial Intelligence, IoT, Big Data, 3D Printing, Virtual Reality etc.
2. The National Research Foundation to be established to fund, coordinate and promote R&D.
3. Rs 400 crore (US$ 60 million) provided for ‘World Class Institutions’ for FY20
4. “Study in India” to bring foreign students to higher educational institutions
5. The Government of India has decided to extend the pension benefit to about three crore retail traders & small shopkeepers whose annual turnover is less than Rs 1.5 crore (US$ 0.22 million) under “Pradhan Mantri Karam Yogi Maandhan Scheme.

Vision for the Next Decade:

1. Building Team India with Jan Bhagidari: Minimum Government Maximum Governance.
2. Achieving green Mother Earth and Blue Skies through a pollution-free India.
3. Making Digital India reach every sector of the economy. Launching Gaganyan, Chandrayan, other Space and Satellite programmes.
4. Building physical and social infrastructure.
5. Water, water management, clean rivers.
6. Blue Economy.
7. Self-sufficiency and export of food-grains, pulses, oilseeds, fruits and vegetables.
8. Achieving a healthy society via Ayushman Bharat, well-nourished women & children, safety of citizens.
9. Emphasis on MSMEs, Start-ups, defence manufacturing, automobiles, electronics, fabs and batteries, and medical devices under Make in India.

Suggested Read: Key Highlights of Union Budget 2021-22

MISCELLANEOUS:

1. Election 2019 mandate was full of hope for new India
2. Voters stamped their approval on a performing government
3. People of India voted for national security, economic growth
4. Have set the ball rolling for new India
5. Govt provided fiscal discipline during 2014-2019
6. The average food security amount almost doubled during 2014-19
7. Our last-mile delivery stood out, reached everywhere
8. Will further simplify the procedure, reduce red tape
9. Mega programmes initiated in 1st term will continue
10. We don’t look down upon legitimate profit-earning
11. To take the step for a virtuous cycle of domestic, foreign investment
12. Time right for India to enter aircraft financing, leasing
13.  Launched co to tap ISRO’s capabilities commercially