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Hot Deal Budget 2021 Highlights

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  • FM announces the Jal Jeevan Mission with an outlay of 2.87 lakh crores aiming to provide full-fledged water supply to all urban local bodies with household tap connections.
  • The FM proposed Rs1.41 lakh crores over a period of 5 Years for the Urban Swacch Bharath 2.0.
  • An amount of Rs.1.47 lakh crores, over a 5-year-period, from 2021 has been assigned for initiatives such as wastewater treatment, reduction in plastic waster, reduction in pollution and the like.
  • The Scrapping Policy has been announced in the Budget2021. The voluntary vehicle scrapping policy aims to remove inefficient vehicles so as to reduce vehicular pollution and oil import bills.
  • FM proposes an amount of Rs.35000 crore to manufacture and make accessible the COVID19 vaccine.
  • FM proposes an amount of Rs. 1.97 lakh crores, over 5 years, starting this FY to nurture global manufacturing champions and increase jobs for the youth
    FM has proposed a mega-investment textile park to be launched along with 7more textile parks to be established over the next 3 years.
  • The FM proposes to set up a Development Financial Institution with an amount of Rs.5 lakh crores
  • FM states that the Budget2021 will focus on the NHAI operational toll roads, airports in tier-2 and 3 cities, and sports stadiums
  • The capital expenditure for the year 2021-22 will be 5.54 lakh crore with a 34.5% Y-o-Y growth rate.
  • Our FM announced that more than Rs.2 lakh crores will be allocated for capital expenditure in the states and other autonomous bodies.
  • FM announced that till date, a measure of 3,800 km highway-stretch has already been constructed and an additional km will be constructed under Bharat Mala project.
  • The FM proposed the following National Highway budget for the below states:
  • Tamil Nadu: 3500km @ Rs. 1.03 lakh crores
    Kerala: 1100km @ Rs.65,000 crores
    West Bengal: 675km @ Rs.25,000 crores
  • Also, National highway project of around 19,000 crores is in progress in Assam. Overall, the FM proposes a total of Rs.1,18,101 lakh crore for Ministry of Road Transport and Highways.
  • An Infra-National Rail plan to prepare a future rail system in India by 2030 has been proposed to bring down logistics cost.
  • The next few phases of metro projects will be taken up in Metro cities. Also in line are the ‘Metro Lite’ & ‘Metro New’ concepts for tier 1& 2 cities.
  • The FM proposed to extend Ujjwala Scheme up to 1 crore beneficiaries from the existing 8 crore beneficiaries.
  • The FM proposes to focus on the various allied laws of the securities market to be merged to the Securities Market Code.
  • FM announced that the #SEBI will be notified to regulate the setting up and arrangement of the commodity market system.
  • FM grants Rs.1,000 crores to the Solar Energy Corporation of India for the growth of the Solar Energy Sector.
  • FM proposed to amend the Insurance Act to introduce additional FDI to insurance companies from the existing 49% to 74%.
  • FM announces that a new Asset Reconstruction Company is to be set up to provide resolution to stressed assets in PSUs.
  • The FM proposed to amend the DICGC Act, 1961 to streamline its provision where the depositors of the bank can get easy access to deposits through insurance in the case of a stressed bank.
  • The FM announced that de-criminalization under the Companies Act, 2013 is complete and now the decriminalization of LLP Act, 2008 will be in force.
  • Our FM modified the definition of small companies: companies with a paid-up capital not exceeding 2cr & a turnover not exceeding 20cr are to be considered small companies. Over 2 lakh+ companies benefit from this provision.
  • For Startups and Innovators, the FM announced that the OPC can be incorporated without a limit for turnover or paid-up capital. This also allows NRIs to incorporate OPC in India.
  • Our FM proposes a special framework for MSME.
  • The FM announced that MCA 21 V3.0 to be introduced with additional modules for e-scrutiny and e-adjudication.
  • FM stated that the IPO of the LIC will be carried out in FY 2021-22. Also, for the disinvestment strategy, two PSUs and 1 insurance company will be considered.
  • The FM informed that the 15th Finance Commission’s recommendation is to rationalize and reduce centrally sponsored schemes.
  • In the Agriculture sector, the MSP regime has undergone a change to provide 1.5 times the product cost across all commodities.
  • The total amount paid to wheat farmers was doubled in 2019-20 when compared to 203-14.
  • The FM announced that agricultural credit will be increased to 16.5 lac crore.
  • The FM proposed to enhance the scope of the ‘Operation Green Scheme’ to include 22 perishable crops, and 1.68 crore farmers have registered. Also, 1,000 mundis to be integrated under the said scheme.
  • The FM stated that the government will take up the development of fishing harbors and fish landing centers along the banks of rivers and waterways.
  • The FM announced that the ‘1 nation-1 ration card’ plan has been implemented by 32 States and UTs. Migrant workers benefit from this scheme as they can claim ration from anywhere in the country.
  • The total fiscal deficit is pegged at 9.5 % of GDP and it is funded through govt borrowing. An additional 80,000 crore is needed to ensure our economy is given the needed push.
  • The borrowings from the market for next year will be at 12 lakh crores.
  • FM announced that the senior citizens who get only pension and interest on income are not required to file ITR.
  • Reopening of assessment:
  • In normal cases: the time limit has been reduced to 3 years from 6 years.
    In serious tax evasion cases: can be reopened till 10 years, only when concealment of income is more than 50 lakh.
  • FM announced that the ‘Faceless dispute resolution committee and mechanism’ is set up to reduce litigations for small taxpayers. Any taxpayer with taxable income up to 50 lakh and disputed income up to 10 lakh can approach the committee.
  • FM proposed a faceless Income Tax Appellate Tribunal (ITAT) for providing online resolution.
  • The ‘tax audit limit’ under Section 44AB has been increased from Rs.10 crores to Rs.5 crores where 95% of business transactions are done in digital mode.
  • The FM announced that the ‘advance tax liability’ on dividend income shall rise only after the declaration or payment of dividend.
  • The FM announced that the deduction under section 80EEA is to be extended to loans taken up to 31st March 2022.
  • FM announced that the affordable housing projects can avail tax holiday until 31 March 2022.
  • FM announces tax incentives for the IFSC and tax holiday for aircraft leasing and rental companies.
  • FM announces the pre-filled ITR in Budget2021: Salary, Tax Payments, TDS are already pre-filled. Capital Gains, dividend incomes, and interest income will now be pre-filled.
  • FM states that in case the PF amount was deducted but not deposited by the employer, it will not be allowed as a deduction for the employer.
  • FM announces that the deduction under section 80IAC will be extended upto 31st March 2021.
  • Under Indirect Taxation, the FM proposes to review 400 old exemptions this year through extensive consultations. After which a revised customs duty structure will be introduced.
  • The FM has rationalized customs duty on copper, textile, gold and silver.
  • The FM raised customs duty on solar inverters from 5% to 20% and solar lanterns from 5% to 15%.
  • The FM proposed to withdraw exemption on import of leather as they are domestically produced.
  • The FM proposes ‘Turant Customs’ initiative for faceless, paperless, and contactless customs measures.
61 Comments  |  
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KG+
TLDR, any change in income tax scheme? They introduced one new agriculture cess which will be imposed on petrol/diesel and things like gold etc. What does that mean? On the latter the import duty was decreased 5%. So, how will agriculture cess be added to it?

An amount of Rs.1.47 lakh crores, over a 5-year-period, from 2021 has been assigned for initiatives such as wastewater treatment, reduction in plastic waster, reduction in pollution and the like.
Corruption ki khuli chuut hogi is mehakame ko.

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FM announced that the senior citizens who get only pension and interest on income are not required to file ITR. >>>> The age is 75 years afaik not 60 and above.
In normal cases: the time limit has been reduced to 3 years from 6 years. >>>> Wasn’t this 8 years earlier?
The FM raised customs duty on solar inverters from 5% to 20% and solar lanterns from 5% to 15%. >>>> This will nullify the decrease in carbon tax initiative like scrappage policy etc.
The FM proposed to amend the DICGC Act, 1961 to streamline its provision where the depositors of the bank can get easy access to deposits through insurance in the case of a stressed bank >>>> FRDI? Access to customer’s deposits?

Can anyone explain the different sections of tax saving modes like 80C, 80EEA etc?

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billubakra wrote:

FM announced that the senior citizens who get only pension and interest on income are not required to file ITR. >>>> The age is 75 years afaik not 60 and above.
In normal cases: the time limit has been reduced to 3 years from 6 years. >>>> Wasn’t this 8 years earlier?
The FM raised customs duty on solar inverters from 5% to 20% and solar lanterns from 5% to 15%. >>>> This will nullify the decrease in carbon tax initiative like scrappage policy etc.
The FM proposed to amend the DICGC Act, 1961 to streamline its provision where the depositors of the bank can get easy access to deposits through insurance in the case of a stressed bank >>>> FRDI? Access to customer’s deposits?

Can anyone explain the different sections of tax saving modes like 80C, 80EEA etc?

You missed the most important point. smile

FM announces the pre-filled ITR in Budget2021: Salary, Tax Payments, TDS are already pre-filled. Capital Gains, dividend incomes, and interest income will now be pre-filled.

No more avoiding tax on all those funds in savings acc in idfc.
@bikidas2060 @MrKool_JJ @caks2006407 @ManojSingla @Tejaa @AJ89 @aam_aadmi @avgn @VellaBoy @rockingneo @GoogleCA @A2Zdeals

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guest_999 wrote:

You missed the most important point. smile

FM announces the pre-filled ITR in Budget2021: Salary, Tax Payments, TDS are already pre-filled. Capital Gains, dividend incomes, and interest income will now be pre-filled.

No more avoiding tax on all those funds in savings acc in idfc.
@bikidas2060 @MrKool_JJ @caks2006407 @ManojSingla @Tejaa @AJ89 @aam_aadmi @avgn @VellaBoy @rockingneo @GoogleCA @A2Zdeals

It means all banks will deduct  tax on interest earned in savings accounts irrespective of tax slab of individual?
And at what rate  10%??

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guest_999 wrote:

You missed the most important point. smile

FM announces the pre-filled ITR in Budget2021: Salary, Tax Payments, TDS are already pre-filled. Capital Gains, dividend incomes, and interest income will now be pre-filled.

No more avoiding tax on all those funds in savings acc in idfc.
@bikidas2060 @MrKool_JJ @caks2006407 @ManojSingla @Tejaa @AJ89 @aam_aadmi @avgn @VellaBoy @rockingneo @GoogleCA @A2Zdeals

Sorry for this stupid question, pre filled matlab? It’s limit of 10k is still there, right?

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AJ89 wrote:

It means all banks will deduct  tax on interest earned in savings accounts irrespective of tax slab of individual?
And at what rate  10%??

It means now you cannot hide/avoid showing interest income correctly in itr(many people having 15-20k interest income at 6-7% savings acc interest were showing it as 10-11k & after claiming 10k deduction hardly any/no tax to pay)will have to pay exact tax on all interest income minus 10000.
@billubakra

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guest_999 wrote:

It means now you cannot hide/avoid showing interest income correctly in itr(many people having 15-20k interest income at 6-7% savings acc interest were showing it as 10-11k & after claiming 10k deduction hardly any/no tax to pay)will have to pay exact tax on all interest income minus 10000.
@billubakra

Ok bro then no impact on me, as I shown correctly all the time. Btw idfc reduced it to 6% pensive pensive

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billubakra wrote:

KG+
TLDR, any change in income tax scheme? They introduced one new agriculture cess which will be imposed on petrol/diesel and things like gold etc. What does that mean? On the latter the import duty was decreased 5%. So, how will agriculture cess be added to it?

An amount of Rs.1.47 lakh crores, over a 5-year-period, from 2021 has been assigned for initiatives such as wastewater treatment, reduction in plastic waster, reduction in pollution and the like.
Corruption ki khuli chuut hogi is mehakame ko.

No change in IT tax slabs
Petrol and diesel will get costlier due to this cess

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AJ89 wrote:

Ok bro then no impact on me, as I shown correctly all the time. Btw idfc reduced it to 6% pensive pensive

But many don’t show this interest income correctly & they will be most affected by this change. Yes I know but I never expected idfc to continue giving 7% interest rate for long & in fact if it keeps giving such rate for long then I would have become cautious as it is just not financially viable nowadays to offer 7% interest rate on deposit for any scheduled commercial bank.

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AJ89 wrote:

It means all banks will deduct  tax on interest earned in savings accounts irrespective of tax slab of individual?
And at what rate  10%??

No change in TDS rules unless specifically announced. It mean interest income earned from deposits in banks shall automatically show-up while filing your IT Return. It does not clearly say whether interest income only from FD will show up or from FD & savings both.
Many banks were already reporting the FD income to the IT department against the account holder’s PAN number, irrespective of the interest amount without any TDS.
This does not require any change in TDS rules

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BAT_MAN wrote:

No change in IT tax slabs
Petrol and diesel will get costlier due to this cess

Petrol and diesel will get costlier due to this cess- wrong. Pls read full

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guest_999 wrote:

It means now you cannot hide/avoid showing interest income correctly in itr(many people having 15-20k interest income at 6-7% savings acc interest were showing it as 10-11k & after claiming 10k deduction hardly any/no tax to pay)will have to pay exact tax on all interest income minus 10000.
@billubakra

Govt will say it as ease of filing return but in effect it will curb evasion
Whatever less or more but some amount of untaxed savings interest, mf capital gains will get taxed
Govt has all the data, just that they were not using it up
Each year (whichever govt it is) income tax bureaucrats plug some loophole

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Alexios wrote:

Petrol and diesel will get costlier due to this cess- wrong. Pls read full

no impact over petrol, diesel as of now as agri cess is adjusted by excise, saed duty as of now

basically they reduced duty so gave from one hand and then took it back by another hand by applying agri cess

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A2Zdeals wrote:

no impact over petrol, diesel as of now as agri cess is adjusted by excise, saed duty as of now

basically they reduced duty so gave from one hand and then took it back by another hand by applying agri cess

“As of now”

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billubakra wrote:

FM announced that the senior citizens who get only pension and interest on income are not required to file ITR. >>>> The age is 75 years afaik not 60 and above.
In normal cases: the time limit has been reduced to 3 years from 6 years. >>>> Wasn’t this 8 years earlier?
The FM raised customs duty on solar inverters from 5% to 20% and solar lanterns from 5% to 15%. >>>> This will nullify the decrease in carbon tax initiative like scrappage policy etc.
The FM proposed to amend the DICGC Act, 1961 to streamline its provision where the depositors of the bank can get easy access to deposits through insurance in the case of a stressed bank >>>> FRDI? Access to customer’s deposits?

Can anyone explain the different sections of tax saving modes like 80C, 80EEA etc?

so bad that solar is becoming expensive

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billubakra wrote:

Sorry for this stupid question, pre filled matlab? It’s limit of 10k is still there, right?

The TDS rate on fixed deposits (FDs) is 10% if the interest amount for the entire financial year exceeds Rs 10,000 for AY 2019-20.
In the interim budget 2019, the TDS deduction limit on FD has been increased to Rs. 40,000 annually which is applicable in AY 2020-21.

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guest_999 wrote:

It means now you cannot hide/avoid showing interest income correctly in itr(many people having 15-20k interest income at 6-7% savings acc interest were showing it as 10-11k & after claiming 10k deduction hardly any/no tax to pay)will have to pay exact tax on all interest income minus 10000.
@billubakra

Aag se khelne vale ch*tiye hamesha pele jaate hai

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Alexios wrote:

Petrol and diesel will get costlier due to this cess- wrong. Pls read full

[email protected]_MAN Check karo sahi btao. AFAIK it will get costlier soon as that Agriculture cess is imposed on it along with state tax, swach bharat cess, jumla cess and what not.

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billubakra wrote:

[email protected]_MAN Check karo sahi btao. AFAIK it will get costlier soon as that Agriculture cess is imposed on it along with state tax, swach bharat cess, jumla cess and what not.

AIDC of Rs 2.5 on petrol and Rs 4 on diesel.
These will not result in any additional burden on consumers AS OF NOW

Bcoz, petrol was earlier attracting a basic excise duty (BED) of Rs 2.98 and a special additional excise duty (SAED) of Rs 12 per litre. These have now been reduced to Rs 1.4 and Rs 11 per litre, respectively.

Similarly, the BED on diesel has been cut from Rs 4.83 to Rs 1.8 and the SAEC on it from Rs 9 to Rs 8 per litre.

Overall excise incidence on petrol (BED+SAEC+AIDC) will now be Rs 14.9/litre, which was previously Rs 14.98, while that on diesel is Rs 13.8 (earlier Rs 13.83)

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bpadman wrote:

The TDS rate on fixed deposits (FDs) is 10% if the interest amount for the entire financial year exceeds Rs 10,000 for AY 2019-20.
In the interim budget 2019, the TDS deduction limit on FD has been increased to Rs. 40,000 annually which is applicable in AY 2020-21.

FD interest is fully taxable though irrespective of TDS limit so practically no benefit of higher tds limit.

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Star_Chaser wrote:

Don’t see much attraction… Still stock market bumping flushed

Now you know why many people make lakhs/crores in stock market but very few people become actual lakhpati/crorepati because of stock market. wink

Missing