KEY HIGHLIGHTS OF UNION BUDGET 2020-21

Sr.No.

Areas

Key Highlights

1

• Optional tax regime (devoid of deductions) for individual tax payers:

• Corporate Tax: New Companies in manufacturing sector be taxed at a 15 %
• 100% tax exemption on Sovereign Wealth Funds’ Indra Investment.
• Concessional 5% withholding tax extended to municipal bonds
• ESOP to be taxed at the end of 5 years, leaving the company or selling shares, whichever is earlier.
• Concessional tax rate of 15% for new domestic companies in electricity generation.
• Dividend Distribution Tax to be removed, companies will not be required to pay DDT, dividend to be taxed only at the hands of recipients at applicable rates
• Charitable institutes be registered with the Income tax department

2

• Get exemption from interest and penalty on payment of disputable tax till 31st March, 2020.
• Tax payer charter (to stop tax harassment) to be a part of the Statute
• CBDT to adopt tax charter.
• New digital scheme for litigation
• Faceless assessments and appeals

3

• Allocation of INR 103 lakh crores for infrastructure pipeline.
• Audit threshold for MSMEs raised to ₹5 crore from ₹1 crore.
• Digital refund to exporters for duties and taxes currently not being refunded
• Firms operating old thermal power plants advised to shut units if emission norms not met
• Allocation of ₹44 billion for clean air incentives in cities with over 1 million people

4

• Establishment of pension fund by employers other than Government.
• Investment in government securities open to Non Residents.

5

• Deposit insurance coverage increased to ₹5 lakh from the existing ₹1 lakh.
• Limits for NBFC for debt recovery decreased to ₹ 50 lakhs.

6

• 150 higher education institutions to offer apprenticeship diplomas by March 2021. Government will promote ‘Study in India’ initiative.
• Attach a medical college to a district hospital in PPP model
• Urban local bodies to provide opportunities to fresh engineers for 1 year.
• Introduction of Ind Sat Examination for foreign candidates.
• Launch of “TB harega desh jeetga” (TB will be defeated and the country will win) campaign to eliminate tuberculosis by 2025,”

7

• 2,500 access control highway
• 9,000 km eco-development corridors
• 200 coastal and port roads
• 2,000 km strategic highways
• Delhi-Mumbai expressway and 2 other corridors will be completed by 2023
• 4 station re-development projects in railways via PPP models
• 100 more airports to be developed by 2024 to support Central government’s “Udaan” scheme.
• Indian Railways will set up Kisan Rail in public–private partnership (PPP) mode for cold supply chain to transport perishable goods.