Comprehensive Analysis of Union Budget 2024 | Initiatives, Schemes and Statistics Explained

Summary

The video provides a comprehensive breakdown of India's Union Budget 2024, discussing key aspects such as the fiscal deficit, taxation reforms, and expert opinions. The government's projected fiscal deficit stands at ₹16.13 lakh crore, indicating the need for borrowing to meet expenditures. The budget introduces changes in income tax slabs, capital gains taxes, and abolishes the Angel Tax to support startups. However, the budget faces criticism for tax hikes on capital gains and the increase in the Securities Transaction Tax. Experts highlight the need for bold reforms to accelerate economic growth and create jobs, while others appreciate the long-term development focus.

Takeaways

• 😀 The Union Budget 2024 of India shows a significant fiscal deficit of ₹16.13 lakh crores, as the government's expenditure exceeds its receipts.
• 😀 Fiscal Deficit is projected at 4.9% of GDP for 2024-2025, down from 5.6% in the previous year, indicating fiscal consolidation.
• 😀 The fiscal deficit target for India is set to reach 3% of GDP by 2028 as part of the Fiscal Responsibility and Budget Management Act.
• 😀 Tax reforms include an increase in long-term capital gains tax from 10% to 12.5%, and short-term capital gains tax from 15% to 20%.
• 😀 The Angel Tax, which previously imposed a 30% tax on funding received by unlisted startups above fair market value, has been abolished.
• 😀 Corporate tax for foreign companies has been reduced from 40% to 35%, encouraging foreign investment.
• 😀 The Securities Transaction Tax (STT) has increased for futures (0.02%) and options (0.1%), drawing criticism from business sectors.
• 😀 Critics argue the tax increases, especially in capital gains, could lead to reduced investor confidence and capital outflows to tax havens like Dubai and Singapore.
• 😀 Supporters of the budget praise its long-term growth focus, with a vision of making India a developed country by 2047.
• 😀 Despite some criticisms, the budget is seen as a step towards fostering inclusive growth, economic stability, and improving the public's quality of life.

Q & A

What is the total projected budget expenditure for India in 2024?

The total projected budget expenditure for India in 2024 is ₹48.2 lakh crore.

What is the total budget receipts expected in India for 2024?

The total budget receipts expected for India in 2024 are ₹32.7 lakh crore.

What is the fiscal deficit for India in 2024-2025, and how is it calculated?

The fiscal deficit for India in 2024-2025 is estimated at ₹16.13 lakh crore, which is the difference between total expenditure (₹48.2 lakh crore) and total receipts (₹32.7 lakh crore).

What is the government's target for fiscal deficit by 2028 according to the FRBM Act?

The government's target for fiscal deficit by 2028 is 3% of the GDP, as per the Fiscal Responsibility and Budget Management (FRBM) Act.

What changes have been made to the income tax slabs in the 2024 budget?

The 2024 budget introduces a new regime for income tax slabs, aiming to simplify the tax system. A comprehensive review of the Income Tax Act of 1961 has also been announced to reduce disputes and litigations.

What is the revised rate of long-term and short-term capital gains tax in the 2024 budget?

In the 2024 budget, the long-term capital gains tax has been increased from 10% to 12.5%, and the short-term capital gains tax has been increased from 15% to 20%.

Why has the increase in capital gains tax been criticized?

The increase in capital gains tax has been criticized for potentially reducing investor confidence, demotivating investments in capital assets, and leading to investments moving to unproductive assets like gold or real estate.

What is Angel tax, and why was it abolished in the 2024 budget?

Angel tax is a tax on funding received by unlisted startups when the investment exceeds the fair market value. It was abolished in the 2024 budget to support the startup ecosystem.

What changes were made to the corporate tax rate for foreign companies in the 2024 budget?

The corporate tax rate for foreign companies has been reduced from 40% to 35% in the 2024 budget.

What are the criticisms related to the increase in the Securities Transaction Tax (STT)?

The increase in the Securities Transaction Tax (STT) on futures and options has been criticized for potentially negatively affecting market liquidity and investor sentiment.

What is the suggestion made by some experts regarding income tax reform in India?

Some experts suggest implementing a single income tax rate of 20% for income above ₹10 lakh to simplify the system and make it more efficient, removing the multiple income tax slabs.

How do experts view the government's approach of taxing more, spending more, and borrowing more?

Many experts believe this approach is not the best for economic growth. They argue that more disposable income should be left with private businesses to promote job creation and investments.