Finance Minister Nirmala Sitharaman emphasized the Centre’s support to states with timely tax devolution and GST compensation arrears to boost growth on Saturday. At the pre-budget meeting with state finance ministers, Sitharaman encouraged states to make use of the scheme where the Centre offers a 50-year interest-free loan for specific reforms. She also highlighted the government’s support through timely tax devolution, Finance Commission grants, and GST compensation arrears to stimulate growth, according to an official statement.
As per latest reports, the FM will table the budget 2024-25 in the third week of July, with the commencement of the Monsoon Session of the Parliament. The Monsoon Session is set to begin on July 22, per sources. The session is likely to continue until August 9. Stay with us here as we provide real-time updates, insights, and expert opinions on what to expect from the upcoming budget.
In its June monetary policy committee meet, the RBI decided to keep its repo rate unchanged at 6.50 per cent, for the eighth time in a row. The RBI MPC met for the first time after the Lok Sabha Elections 2024. The six-member MPC decided to keep the interest rate unchanged by a 4:2 majority. Meanwhile, economists opined that the rate cut cycle is unlikely to start before October 2024.
Before the Union Budget 2024, the Indraprastha Gas Limited (IGL) has announced a Rs 1 per kilogramme increase in Compressed Natural Gas (CNG) rates. In Delhi, the price has risen from Rs 74.09 to Rs 75.09 per kg, Noida, Greater Noida, and Ghaziabad, the prices have increased from Rs 78.70 to Rs 79.70 per kg and in Gurugram, Haryana, there has been no change in the CNG prices.
The Modi 3.0 has approved a release of Rs 20,000 crore to 93 million farmers as the 17th instalment of direct cash benefit programme – Pradhan Mantri Kisan Samman Nidhi (PM-kisan). This is the new government’s “first” decision after it assumed office. More than Rs 3 trillion have been transferred to farmers’ bank accounts, since the launch of direct cash transfer scheme in February, 2019.
In its June Global Economic Prospects report, World Bank said that India will remain the fastest growing of the world’s largest economies, and its pace of expansion is expected to moderate with a steady average annual growth of 6.7 per cent between FY25 and FY27. It raised India’s growth projection by 0.2 per cent points each to 6.6 per cent for FY25 and 6.7 per cent in FY26 compared with its projection in January this year.
CII President Sanjiv Puri recommends income tax relief for the lowest slab in the upcoming budget to counter high inflation. He calls for a consensus platform for reforms. CII anticipates Budget 2024-25 to prioritise public capital expenditure, fiscal discipline, social infrastructure, a green fund, and rural sector investment.
The Union Budget was printed exclusively in English until 1955. However, starting with the 1955-56 Budget, because of an initiative led by the then Finance Minister CD Deshmukh, it began to be presented in both English and Hindi.
The Union Budget was leaked in 1950, despite its great security. During that time, John Mathai served as the Finance Minister. Following the leak, the printing of the budget was moved from Rashtrapati Bhawan to Minto Road. After 1980, the budget printing process moved to the North Block basement.
The National Logistics Policy and PM Gati Shakti National Master Plan are transforming the logistics industry, both technologically and structurally. Continued infrastructure investment across the budget is critical to sustaining this growth, allowing for a robust distribution network and stronger global value chain links.
Prime Minister Modi’s third term focuses on tackling agricultural issues, boosting job creation, maintaining capital expenditure, and enhancing revenue growth for fiscal stability. S&P has raised India‘s sovereign rating outlook to positive, endorsing the country’s economic policies of the past decade. Further rating upgrades are possible in the next 1-2 years if fiscal deficit targets are met by the government.
The Reserve Bank of India forecasts the Indian economy to grow by 7.2 per cent this fiscal year, boosted by more rural consumption and lower inflation. The Modi 3.0 government inherits a thriving economy with strong fiscal discipline, which is backed by the RBI‘s record-high dividend of Rs 2.11 lakh crore for FY24.
– Commitment to meet ‘Net Zero’ by 2070
– Viability gap funding for wind energy
– Setting up of coal gasification and liquefaction capacity
– Phased mandatory blending of CNG, PNG and compressed biogas
– Financial assistance for procurement of biomass aggregation machinery
The 53rd meeting of the Goods and Services Tax (GST) Council marks the first gathering since the new government took office. State finance ministers will join this important session to discuss various aspects of the GST system. As usual, the GST Council will address topics such as tax rates, policy modifications, and administrative challenges. This council plays a crucial role in shaping India‘s indirect tax framework, aiming to balance business and citizen tax relief with the country’s economic goals.
Finance Minister Nirmala Sitharaman chaired a pre-budget meeting with Finance Ministers from all States and Union Territories today. This meeting, organized by the Ministry of Finance and Corporate Affairs, aimed to gather suggestions for the upcoming Union Budget 2024-25.
A day after Nirmala Sitharaman took office as the Union Minister of Finance and Corporate Affairs, the government announced the 53rd GST Council meeting, set to take place on June 22, 2024, in New Delhi.
In a pre-Budget consultation meeting with industry leaders and associations, the finance minister received suggestions aimed at advancing India‘s journey towards ‘Viksit Bharat.’ PHDCCI proposed ten key reforms:
Nirmala Sitharaman is poised to set a new record for presenting the most consecutive Union Budgets in India. With the upcoming Union Budget 2024, she will surpass former finance minister Morarji Desai’s record of six consecutive budget presentations. This budget is anticipated to outline the economic agenda for Modi 3.0.
Previously, the government imposed a tax known as the Dividend Distribution Tax (DDT) on these dividends. Introduced in the Finance Act of 1997, DDT applied to dividends distributed by domestic companies, regardless of whether the companies had already paid income tax on the profits from which the dividends were derived. However, in the 2020-21 Budget, the Indian government made a significant change by abolishing the DDT. This means that companies are no longer required to pay this separate tax on distributed dividends. Instead, shareholders are now responsible for paying taxes on dividends they receive, based on their individual income tax rates.
This change aimed to simplify the taxation system related to dividends and align it more closely with international practices where shareholders are taxed directly on dividends received.
Dividends are payments that companies distribute to their shareholders from their profits. These payments serve as a reward to shareholders for investing in the company.
Finance Minister Sitharaman on Thursday conducted the second pre-Budget meeting with prominent experts from the financial and capital markets sectors. The consultation was attended by Union Minister of State for Finance Pankaj Chaudhary, along with the Finance Secretary, Secretaries from the Department of Expenditure, Economic Affairs, Investment and Public Asset Management (DIPAM), Revenue, Financial Services, Corporate Affairs, and the Chief Economic Adviser.
Nirmala SitharamanThe finance minister led the initial pre-Budget talks on Wednesday with prominent economists for the upcoming General Budget 2024-25. The session included Union Minister of State for Finance Pankaj Chaudhary, the finance secretary, and secretaries from the economic affairs, revenue, financial services, and corporate affairs departments, along with the chief economic adviser. Economist Ashwani Mahajan stated to PTI, “We’ve had our first pre-budget discussion. Leading economists from around the country participated and shared their ideas for the budget.”
Section 80C limit has remained untouched since 2014 despite the rise in inflation rates. Experts feel that the govt is likely to make changes in this when announcing the budget this year.
Income tax exemption limits are affected by various things including economic conditions, government priorities, revenue needs, and political factors.
Reuters has reported that the upcoming Budget 2024 under Modi 3.0 is expected to provide relief to taxpayers by potentially reducing income tax rates for certain groups. The government is also contemplating a decrease in income tax rates for individuals earning annual incomes of Rs 10 lakh.
Prime Minister Modi’s third term focuses on tackling agricultural issues, boosting job creation, maintaining capital expenditure, and enhancing revenue growth for fiscal stability. S&P has raised India‘s sovereign rating outlook to positive, endorsing the country’s economic policies of the past decade. Further rating upgrades are possible in the next 1-2 years if fiscal deficit targets are met by the government.
The Reserve Bank of India expects the Indian economy to grow by 7.2 percent this fiscal year, supported by increased rural demand and lower inflation. The Modi 3.0 government inherits a robust economy marked by solid fiscal discipline, further bolstered by the RBI‘s record-high dividend of Rs 2.11 lakh crore for FY24.
Saloni Verma, Co-Founder and chairperson, Sunshine Corporate Creches says,
“The recent elections have given multiple indications that citizens want the Government to focus on their immediate needs, getting them jobs, which now seems to be even more important than handing out freebies or propagating their religion etc. There is a very simple option within the existing set of laws for the Government to:-
(i) create jobs in every single company that operates,
(ii) improve employee satisfaction due to work-life balance,
(iii) increase the gender ratio in companies by ensuring women don’t drop out,
(iv) build better citizens tomorrow by ensuring better quality education during the important early learning phase of children under 8 years of age.
The Maternity Act 2017 made it mandatory for companies to offer creche services for all their employees which would achieve all the above benefits immediately. If the Government offers special incentives for those who invest in implementing this law both in letter and in spirit it would meet multiple goals.”
“As the Modi 3.0 government prepares to announce the budget, there are several key areas we hope will be addressed to support the various sectors. Government Contribution to PF/ESI: We hope the budget will link government contributions towards Provident Fund (PF) and Employee State Insurance (ESI) with the employee’s tenure within the company. Enhanced contributions for longer tenures would promote employee retention and financial security,” Dr. Ravinder Goyal, Founder and CEO, Erekrut.
Amit Prasad, Founder and CEO, SatNav Technologies says, “Over the last 3 decades, the IT services industry has helped create a brand for India worldwide, generated employment opportunities to expand our middle class, and earned forex for the country. Looking forward for next decade and beyond, mere cost arbitrage is no longer going to sustain much longer as cheaper countries exist and cost efficiencies are being ensured in developed countries too. Skillsets are being acquired by multiple countries worldwide which is already making it less of a differentiator. It is very important for the Government to find a way to incentivize companies building Products and creating Intellectual Property from India that can be sold worldwide. Only a handful of success stories are there, while many others have good products, the availability of funds to scale their businesses is lacking. The funding ecosystem in the country comprising VCs, PEs, Family offices and Angel Investors are a very disjoint set of people with varying experiences and knowledge. The Government has a host of subsidies, incentives, and foreign missions that are supposed to promote trade with multiple officers occupying plum posts in countries around the world. Giving them targets for the growth of new business with a focus on IPR-based entities can do wonders for our country and give us that next-level boost, which can be 100x bigger than the IT Services boom of the past, as we embark on our journey to a Viksit Bharat 2047.”
According to latest media reports, the forthcoming 2024-2025 Budget will prioritise citizens’ interests. There are discussions about reducing income tax rates for individuals earning between Rs 15 lakh and Rs 17 lakh annually. This move aims to ease financial pressures on middle-income earners, increasing their disposable income.
Rahul Garg, Founder and CEO Moglix says, “Leveraging India‘s strong economic growth and fiscal responsibility, the 2024-25 Budget can become a catalyst for innovation in AI, deep tech, and manufacturing. Increased R&D funding in AI, alongside clear ethical guidelines, is crucial to establish global leadership in this transformative field. For the manufacturing sector, streamlining regulations, tax breaks, and infrastructure investments will boost efficiency and empower startups to compete globally. Specialized incubators, accelerators, and robust export support can provide them with the resources, mentorship, and market access needed for success.”