Interim Budget 2019: Key Highlights
Finance Minister Piyush Goyal tabled the Interim Budget 2019 on February 1 and it did strike a chord with key segments of the society and especially the middle-class. Overall, it did turn out to be positive for homebuyers, homeowners and developers.
Here are some key highlights of the Interim Budget 2019:
Income tax benefit for the masses: Individual taxpayers, with a taxable income of Rs 5 lakh, will be given full tax rebate. This would mean they will have to pay no tax. This rebate will also be applicable to such individual, whose gross salary is upto Rs 6.50 lakh.
Additionally, a standard annual deduction, which was proposed in Union Budget 2018, has been raised from the current Rs 40,000 to Rs 50,000.
Selling your residential property got easier: For those with capital gains of up to Rs 2 crore can also heave a sigh of relief. The benefits under Section 54 of the Income Tax Act will now be increased from investment in one residential property to two and can be availed once.
Relief for second self-occupied property owners: The FM has proposed to exempt the levy of tax on notional rent on a second self-occupied home owned by an individual.
GST benefits for homebuyers, maybe: The real estate sector can look forward to GST benefits, once the Group of Ministers appointed by the GST Council come out with their recommendations. "Our government wants the GST burden on homebuyers to be reduced and accordingly we have moved the GST Council to appoint a group of ministers to examine and make recommendations in this regard at the earliest," Goyal said.
Double delight for developers: Section 80-IBA was inserted under the Finance Act, 2016, and came into effect from April 1, 2017. Where the gross total income of an assessee includes any profits from developing/building housing projects, such assessees will be allowed a cent per cent deduction of profits and gains derived from such business. This was allowed for projects approved between June 1, 2016 to March 31, 2019. However, the FM has now extended the timeline. So, such projects, approved up to March 31, 2020, could enjoy the benefits under this Section. This would promote construction of more affordable units across the country.
Additionally, the real estate sector will benefit given that Goyal has proposed to extend the period of exemption from levy of tax on notional rent on unsold inventories from one year to two years calculated from the end of the year when the projected was completed.
Interest earned is less taxing now: Until now, interest earned in excess of Rs 10,000 through banks or through post office schemes was liable for TDS. However, now, the TDS threshold has been raised from Rs 10,000 to Rs 40,000. This is expected to ease the tax burden of the middle-class, especially the homemakers.
Look forward to
Besides this, the vision for India which the minister hailed as “the bright spot of global economy” has also been envisioned with maximum impetus on infrastructure building up to 2030.
Other segments and avenues that found a mention and relief in Interim Budget 2019 include farmers, youth, unorganised workers, filmmakers, as also artificial intelligence, jobs within aviation sector, animal husbandry and fisheries etc.
The government has also stated that it is keen to develop one lakh digital villages across the country. This would, in turn, help the youth turn to employment avenues especially after data usage has grown by over 50 per cent in the last five years and the cost of using it has dropped significantly to settle as one of the lowest tariffs in the world now.
- Road infrastructure has been progressing at the rate of 27 km per day. To further boost the development of roads, the Pradhan Mantri Gram Sadak Yojana has received funds to the tune of Rs 19,000 crore.
- The Pradhan Mantri Shram-Yogi Maandhan, an ambitious pension plan for those falling in the unorganised sector will help such workers receive a pension of up to Rs 3,000 per month.
- Railways has been allotted a budget of Rs 64,587 crore in the upcoming fiscal.
- To also promote waterways in the country, the government plans to scale up its work on the Sagarmala programme and develop other inland waterways faster.
- To curb the rising pollution levels and ensure better environment, under its Vision 2030, the government would focus on promoting electric vehicles running on renewable energy. This would reduce the country's dependence on oil and gas, that is largely imported from other countries.
To read the complete Budget Speech, click here