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Budget 2023 Live: Budget Expectations Live Updates: Finance Ministry considering proposals to benefit India’s middle class


Budget Expectations Live Updates: The finance ministry is considering proposals to benefit the middle class in its last full Budget of the Narendra Modi 2.0 government to be presented on February 1 in the Lok Sabha. The finance ministry is looking into proposals sent by various government departments on specific steps which may be announced in the Budget, benefitting a large section of the middle class, reported PTI citing sources.The government has not raised income tax exemption limit from Rs 2.5 lakh which was fixed in 2014 by the then Finance Minister Arun Jaitley in his first Budget.Also the standard deduction has remained at Rs 50,000 since 2019. Several experts are of the opinion that the exemption limit as well as standard deduction need to be increased to compensate salaried middle class for elevated level of inflation.The recent statement of Finance Minister Nirmala Sitharaman that she was aware of pressures of the middle class has raised hope that some incentives may come for them in the upcoming Budget.”I too belong to the middle class so I can understand the pressures of the middle class. I identify myself with the middle class so I know,” she had said earlier this month.

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Budget expectations Live updates: Social welfare spends likely to continue

Economic recovery has not yet become broadbased and sustainable as only creamier sections are consuming, India Ratings and Research said on Wednesday and added that the FY24 budget is expected to continue with social sector spending. The annual budget for the financial year 2023-24 will be presented in parliament on February 1.Finance Minister Nirmala Sitharaman will focus on making consumption demand resilient, boosting infrastructure and manufacturing capex, skill development and increasing productivity, fiscal consolidation and climate change in the last budget of this government, reported PTI citing the agency.It said there is likely to be a “stark difference” between economic performances of the first and second halves of FY23, which will suggest that it is only the upper layers which are driving the private final consumption, the agency said.

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Budget expectations Live updates: FinMin contemplating sops for middle class

The finance ministry is considering proposals to benefit the middle class in its last full Budget of the Narendra Modi 2.0 government to be presented on February 1 in the Lok Sabha. The finance ministry is looking into proposals sent by various government departments on specific steps which may be announced in the Budget, benefitting a large section of the middle class, PTI sources said.The government has not raised income tax exemption limit from Rs 2.5 lakh which was fixed in 2014 by the then Finance Minister Arun Jaitley in his first Budget.Also the standard deduction has remained at Rs 50,000 since 2019. Several experts are of the opinion that the exemption limit as well as standard deduction need to be increased to compensate salaried middle class for elevated level of inflation.The recent statement of Finance Minister Nirmala Sitharaman that she was aware of pressures of the middle class has raised hope that some incentives may come for them in the upcoming Budget.”I too belong to the middle class so I can understand the pressures of the middle class. I identify myself with the middle class so I know,” she had said earlier this month.

Budget expectations Live updates: Halwa ceremony today

A customary halwa ceremony will be performed on Thursday, before the “lock-in” process of officials involved in the Budget preparation, in the presence of Union Finance and Corporate Affairs Minister Nirmala Sitharaman.The ceremony marks the final stage of preparing the Union Budget. The finance minister begins the ceremony by stirring the halwa in the kadhai and then serves it to colleagues at the ministry’s headquarters in the national capital.To maintain the secrecy of the Budget, there is a “lock-in” of officials involved in making the Budget. These officers and staff come out of the North Block only after the Budget is presented by the Union Finance Minister. The budget document is tabled the lower house of Parliament on February 1.The halwa ceremony takes place at the Union Finance Ministry headquarters, North Block, in the national capital. The Finance Minister, the Minister of State, and other top officials working with the finance ministry are usually present during the ceremony.

Budget expectations Live updates: Govt may roll out measures to strengthen startup ecosystem

The government is expected to announce in the forthcoming Budget steps to further strengthen the startup ecosystem in the country and address inverted duty issues in certain sectors to promote domestic manufacturing, official sources said. Fiscal incentives under the production linked incentive (PLI) scheme to some more sectors are also likely to be announced in the Budget, which will be presented on February 1.Besides, the government may consider providing funds to infrastructure projects approved by the Network Planning Group (NPG), constituted under the PM Gati Shakti initiative, they said.On October 13 last year, Prime Minister Narendra Modi launched the Gati Shakti – National Master Plan aimed at developing integrated infrastructure to reduce logistics costs.The NPG has representations from various connectivity infrastructure ministries/ departments involving their heads of network planning division for unified planning and integration of the proposals.

Budget expectations Live updates: India’s $5-trillion economy dream confronts moribund MSME

Improving access to credit, technological upgradation and ease of doing business is a must to give a leg up to manufacturing MSMEs, say experts. Well-entrenched policies will make the sector self-reliant and encourage the enterprises to go the next mile in their entrepreneurial journey.With 63 million MSMEs in the country, the sector contributes over 30% to the GDP and has the potential to grow further. At an Assocham event in Mumbai last year, Union Minister for MSME Narayan Rane had stated how MSMEs’ contribution to the economy was crucial to India’s growth path. “The ambitious target of a $5-trillion economy with a 25% contribution from the manufacturing sector will require the MSME sector to play a pivotal role,” he said.

Budget expectations Live updates: Is it going to be a pet-friendly Budget?

Ahead of the presentation of the Union Budget for FY24 to be submitted on February 1 by Union Finance Minister Nirmala Sitharaman, several industry bodies and executives have expressed their wish list that ranges from pet friendly to the usual industry friendly.Will Sitharaman accede to their wishes? Nevertheless, the wish list includes Budget which is pet friendly.”With the 2023 budget, we expect an increase in the healthcare sector which is the need of the hour, especially for animals and some species that are on the brink of extinction. The healthcare sector is important for both humans and animals. The first and foremost area that needs to be focused on is an increase in financial support for veterinary services,” IANS quoted Anushka Iyer, Founder and CEO, Wiggles, as saying.”A substantial budget will foster an environment that pushes more people towards creating quality services that can serve both pets and community animals. It shall also help veterinarians to provide better treatment. Secondly, there must be a concerted effort towards education and sensitization for all, not and not limited to the younger generation,” she said.

Budget expectations Live updates: PLI, Make in India scheme to remain in focus this time

The PLI scheme is widely seen as having the potential to be a game changer on the jobs front for India. The stated objective of this scheme is to make local manufacturing globally competitive, create global champions in manufacturing, boost exports and create jobs.So far, the scheme has been rolled out for 14 sectors with an outlay of Rs 2 lakh crore. The sectors include automobiles and auto components, white goods, pharma, textiles, food products, high efficiency solar PV modules, advanced chemistry cell and speciality steel.Make in India, a policy introduced with the aim to transform India into a global hub of manufacturing, has emerged as a force multiplier to provide the country’s workforce with new livelihood options, the government says. The policy completed eight years in September 2022, and in 27 sectors it has driven noteworthy accomplishments including substantial job generation, govt data shows.

Budget Expectations Live Updates: Tax tweaks that professionals/MSMEs having been looking for

In order to boost small and medium businesses in India, the government should consider rationalising certain income tax provisions for small business and professionals in Budget 2023. Here are some of them:

  • Increasing the monetary limit for presumptive taxation and extending the benefit to LLPs – Section 44AD
  • Rationalising certain provisions of section 44ADA applicable for professionals
  • To address issue of non-grant of full TDS credit appearing in Form 26AS
  • Enhancing the threshold limit of TDS u/s 194J and extending the same to directors
  • Reduction in income tax rate for Partnership Firms and LLPs with small businesses
  • Rationalisation of TDS rates for start-ups, small businesses

Budget Expectations Live Updates: Education sector may receive incentives this time

The Education ministry could introduce a slew of measures for Design-Faculty Development. Since shortage of qualified faculty members is the most significant challenge facing design education in India, the first step would be to bring in foreign faculty that are qualified and experienced in their field, to teach the first few batches as also to train new faculty. Institutions can be incentivised for a limited period of say 5 years to hire foreign faculty members. A foreign faculty hiring fund can be created to be used to support the hiring of foreign faculty members by providing financial assistance for their travel and living expenses. Streamlining visa and immigration processes as also giving a tax-incentive on the salaries paid to foreign faculty members will make it easier for institutions to hire them and will encourage more foreign faculty members to come to India to teach.

Budget Expectations Live Updates: The rising risk of a recession in major economies and global uncertainty due to rising Covid cases yet again might lead to volatile market conditions and discourage the government from factoring in significant privatisation/disinvestment proceeds in the budget calculations

– Sakshi Gupta, Principal Economist at HDFC Bank

Budget Expectations Live Updates: Will it take a pause on bank privatisation?

India’s federal government is most likely to take its foot off the gas pedal for bank privatisation and skip any mention of divesting state banks in the upcoming Budget 2023. However, it may use the privatisation of IDBI Bank as a template for such future endeavors, according to experts. In the Union Budget for 2021-22, the government had announced its intent to take up the privatisation of two state-run banks in the year. It also approved a policy for strategic disinvestment of public sector enterprises.

Budget Expectations Live Updates: Urban governance reforms may receive a push

The forthcoming Union Budget is likely to give a major push to urban governance reforms and housing. The government is likely to emphasise on urban governance, with elections to nine states slated for this year. The plan is part of the government’s attempt to woo urban voters. While the BJP has created a dedicated vote bank in rural India through targeted schemes, it may have to work harder in urban seats.

Budget Expectations Live Updates: Insights from pre-Budget survey

  • According to Kantar India Union Budget Survey 2023, most urban Indians were happy with last year’s budget, with 73% claiming it positively impacted their household.
  • While the hope is that the worst is over, the pandemic has still not disappeared yet, hence 55% still wants continued focus on healthcare in this budget as well. This number however is significantly lower than last year’s 66%.
  • Half the people surveyed believe that the Indian economy will grow in 2023 as against 31% who feel there will be a slowdown.
  • Over 50% claim to be in favour of the new tax regime now and this proportion is higher amongst the affluent at 60% and salaried segment 58%, according to the survey that was conducted amongst a sample of 1892 consumers across top 12 key Indian cities.

Budget Expectations Live Updates: Inflation remains India’s top concern

Rising inflation is the top concern for Indians with 75% of the people wanting the government to introduce decisive measures to tackle the same, according to Kantar India Union Budget Survey 2023.One in four Indians is concerned about the threat of job layoff, higher in the affluent, older and salaried classes. With rising healthcare costs, compounded by rising inflation concerns impacting household incomes, increase in rebate on medical/ health insurance is the next big ask among the consumers at 45%.



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