Union Budget 2023: What's there for the Entrepreneurs, Farmers, and Middle Classes?

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Union Budget 2023: What's there for the Entrepreneurs, Farmers, and Middle Classes?

In our day before posts, we have detailed the major highlights of the Union Budget for the fiscal year 2023-24 announced by the Union Finance Minister Nirmala Sitharaman in the February budget session. Today's article is curated categorically for the different sections of society.

Everyone has been eyeing the Union Budget for the past few months, with many speculations swirling around. Now, with the announcement, we have the relevant details for everyone. This year's Budget has much to offer to three classes in general, the Startup Folks, or better, the Entrepreneurs, Farmers, and Middle-Class people. Now without further ado, let us quickly jump into the budget details as per the categories.

A Quick Recap of Budget Announcements from the Day-Before

Increase in Public Investment

• Infrastructure
• Health
• Education

Farmer Support

• Enhancement of the Agricultural Income
• Aid to Farmers through Direct Income support

Taxes & Incentives

Tax incentives for the following promotions:

• Job Creation
• Investment

Providing tax relief to individuals and businesses

E-Payments

• Encouraging Digital Payments
• Exhibiting Financial Inclusion

Manufacturing & Export

• Boosting domestic manufacturing and promoting exports
• Expanding resources for research and development

Financial Services

• Emphasizing the need for fiscal prudence and fiscal consolidation
• Strengthening the capital markets and encouraging foreign investment
• Improving India's ranking in the ease of doing business

Budget Highlights for Entrepreneurs

Let us look at some of the particular benefits for Entrepreneurs.

Tax Incentives

The Government has proposed to provide tax incentives for new enterprises, including startups, to encourage entrepreneurship.

Capital Gains Tax Exemption

To encourage investments into startups, the Government has proposed to exempt long-term capital gains from selling any security or unit of a business trust and units of mutual funds from taxation.

Relaxed Norms for Angel Tax

The Government has proposed to extend the exemption of angel tax to startups as well as to their investors. In addition, the Government has proposed to extend the exemption to startups with a turnover of up to Rs 25 crores. It has a valuation of Rs 100 crore.

Self-Certification Scheme

The Government has proposed extending the self-certification scheme to entrepreneurs engaged in the manufacturing sector. This will help them reduce the compliance burden and free up resources for business expansion.

Relaxed Corporate Tax Structure

The Government has proposed to reduce the corporate tax rate for companies with a turnover of up to Rs 400 crore. This will benefit small and medium-sized enterprises (SMEs) as well as startups.

Budget Highlights for Farmers

The Government has invested invariably in major development schemes, funds, and initiatives for the farmers in the Budget. Let us look at them.

Funds for Farmers

Agriculture Infrastructure Fund

The Centre allocated a budget of Rs. 1.5 lakh crore for the New Agriculture Infrastructure Fund. Agriculture Infrastructure Fund is a top-up scheme of the Indian Government for availing of a grant or subsidy under any present scheme of the Central/State government for projects in addition to this financing facility.

Dairy Processing Infrastructure Development Fund

The Centre has allocated Rs. 20,000 crores for the Dairy Processing Infrastructure Development Fund. Thia Scheme provides loan assistance to the following Dairy Production entities across the country:

• State Dairy Federations
• Milk Producers Companies
• Multi State Cooperatives
• District Milk Unions
• NDDB Subsidiaries

Fisheries and Aqua Culture Infrastructure Fund

The Centre has allocated Rs. 5,000 crores for the development of the Fisheries and Aqua Culture Infrastructure Fund. The Fund provides concessional finance to the following entities for the development of fisheries infrastructure facilities through Nodal Loaning Entities:

• State Governments
• Union Territories
• State Fishery Entities

Beekeeping Initiative

The Centre has allocated Rs. 1,500 crores for the Beekeeping Initiative. It is a new central sector scheme under the National Beekeeping and Honey Mission. This initiative is for the overall development of scientific beekeeping as well as the production of quality honey & other beehive products approved by the Union Government.

Development of Animal Husbandry Infrastructure

The Centre has allocated Rs. 10,000 crores for the Development of Infrastructure in the Animal Husbandry sector. The Animal Husbandry Infrastructure Development Fund incentivizes  investments for the following entities to establish dairy processing, meat processing, and value-addition infrastructure:

• Entrepreneurs
• Private Companies
• MSME
• Farmers Producers Organizations
• Section 8 Companies

Schemes/Yojana for Farmers

Pradhan Mantri Kisan Samman Nidhi (PM-KISAN)

The Union increased the funding for the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) scheme by Rs. 75,000 crores. The PM-Kisan Yojana is a Union Government scheme aimed to provide minimum income support of a maximum of 6000 rupees to all small and marginal farmers.

Kisan Rail Scheme

The Centre has allocated Rs. 500 crores for the Kisan Rail scheme. This Rail scheme enables farmers to utilize the nation's vast railway network, thereby gaining access to more extensive and lucrative markets. Such access will allow farmers to sell their produce at a better price, fulfilling the Government's vision of doubling farmers' income.

Kisan SAMPADA Yojana

The Centre has allocated Rs. 2,500 crores for the Kisan SAMPADA Yojana. The Pradhan Mantri Kisan Sampada Yojana is a comprehensive package for modern infrastructure development with efficient supply chain management right from the farm gate to the outlast retail outlet.

Krishi Udaan Scheme

The Centre has allocated Rs. 500 crores for the Krishi Udaan scheme. The scheme incentivizes the movement of agricultural produce by air transportation with a full waiver of the following:

• Airplane Landing
• Airplane Parking
• TNLC Charges for Indian freighters
• RNFC Charges for Indian freighters 

e-NAM

The Centre has allocated Rs. 2,000 crores for the National Agricultural Market (e-NAM). The National Agriculture Market is a pan-India e-trading portal that networks the existing APMC MANDIS, creating a unified market for various agricultural commodities.

Organic Farming Scheme

The Centre has allocated Rs. 500 crores for the Organic Farming Scheme. With an increasing number of organic products demand, the Union has been promoting Organic Farming as a chemical-free alternative through its dedicated schemes, such as:

• Paramparagat Krishi Vikas Yojana
• Mission Organic Value Chain Development for NE-Region

Budget Highlights for the Middle-Class in India

The Government has exempted or incentivized carious taxes and cesses for the middle class in the current Budget. Let us look at them.

Tax Exemptions

The Centre has increased the exemption limit for Income Tax up to Rs. 5 lakhs for middle-class taxpayers. They have raised the income level to which no tax is payable. It will be 7 lakh rupees a year from FY2023-24. Earlier, it was Rs 5 lakh, but there is a catch. This change is reflective of those choosing the New Tax Regime.

Rise in Standard Deduction

The Centre has increased the standard deduction up to Rs. 50,000 for senior citizens in the middle-class category. The previous standard deduction was available in the old regime, but now you can opt for the new rule for availing of the standard deduction.

Incentive Expansion in the Equity Market

The Centre has expanded tax incentives for investments in equity markets up to Rs. 2 lakhs. The Authority taxes the short-term capital gains in equity funds at the rate of 15% in addition to a 4% cess. At the same time, the Authority taxes long-term capital gains at 10% with a 4% cess if the gain is over Rs 1 Lakh.

Tax Deduction in Housing Loans

The Centre has increased the Tax Deduction for housing loans up to Rs. 3 lakhs. Earlier Tax Deductions for Housing Loans for a Salaried Individual were up to INR 2,00,000. Thi amount was from an individual under Income from House Property. The amount would have been set off against their income from his or her salary.

Opt-Out System for lower Tax Slabs

The Centre has introduced an "opt-out" system for existing income taxpayers to switch to a lower tax slab rate. Now, a salaried taxpayer can choose the tax slab from the new tax regime at the year's beginning and intimate his employer. However, he cannot change his choice during the financial year but during the income tax return filing in July 2024.

Tax Incentives for New Business Ventures

The Centre has extended tax incentives to those who start new businesses. After registering as a Startup, you can apply for Tax Exemption under section 80 IAC of the IT Act. After getting the required clearance for Exemptions, the Startup can also avail of Tax Holiday for three years out of its first ten incorporation years.

Tax Holiday

The Centre has introduced a tax holiday for middle-class startups. After getting the required clearance for Tax Exemptions from the Tax Authority, the Middle-Class Startup can avail of Tax holidays for three consecutive years out of its first ten incorporation years.

Extension of the Vaya Vandana Yojana

The Centre has extended the Pradhan Mantri Vaya Vandana Yojana for senior citizens in the middle-class category. So now, the sale period of Vaya Vandana Yojana has been raised from the fiscal year 2020-21 to March 31, 2023.

Extension of the Fasal Bima Yojana

The Centre has extended the Pradhan Mantri Fasal Bima Yojana for farmers in the middle-class category. The Government has vowed to extend the cut-off date to enroll Maharashtra and other states' farmers from July 15 to July 23 for the designated Kharif season 2021 under its Fasal Bima Yojana.

Tax Exemption for e-Payments

The Centre has introduced tax incentives for digital payments. E-Payments have shown wide acceptance in 2022. An increase of 76% in transactions and 91% in value is recorded for the e-payments in the country. Therefore, the Centre has further allocated funds to provide financial support for the digital public infrastructure in 2023-24.

For more on Union Budget 2023-24, stay tuned to Registrationwala, and follow our social media handles. We provide crisp and concise content latest policy issues of the Government. 

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