The Budget 2020 has brought mixed feelings among the common man as well as some industry
experts. Although the longest ever budget speech has brought relief to some it has aroused
confusion in most others. We got some clarity by watching Akash Banerjee’s ‘Unboxing Budget
2020 – Highlights & Analysis’. While he provided us with some much-needed information about
the Budget 2020 in simple language, he also talked about an interesting opportunity to trade
and earn.
Read on to check out our favourite bits from the video.
He begins the video by discussing the challenges that were in front of our Finance Minister, but,
also gives hope that certain announcements made by her, if executed well, will help increase
the lowest GDP we have had in 11 years.
Taxes
The new Income Tax slabs have led to a sense of excitement among people, but it includes a
lot of ifs and buts. So, it’s best to consult an expert before we jump to any conclusions. He also
talks about how the Bank deposit cover has been increased to Rs. 5 lakhs from Rs.1 lakh. If
anything, it does bring some assurance to the depositors regarding the safety of their hard-
earned money. Amendments to Companies Act are being proposed as the government has
finally realized that the tax system is currently very oppressive. Decriminalization of certain civil
offenses, no tax harassment, and amendment of the I-T Act to allow for faceless appeals have
all been mentioned by her. A scheme has been proposed to close the pending cases, which
seemed like a step in the positive direction by the government as the issues have been
recognized and measures are being taken to eradicate them.
Agrarian crisis
FM Sitharaman has proposed a 16-point action plan to boost agriculture. Addressing this crisis
which all of us know about, is at least one step towards betterment. About 6.11 crore farmers
are to be insured through the prime minister’s insurance scheme and the Central government is
still committed to double farmer’s income by 2022. Their current reluctance in revealing the
farmers’ suicide data makes us question the commitment, but it is something we might see in
the coming year.
Steps to improve the economy
One of the most important factors when it comes to countering economic slowdown is
Infrastructural Spending. Five new smart cities are planned to be built in partnership with public
and private institutions. In more important information, 1.7 trillion has been allocated by our FM
for transport infrastructure. This is so critical because this can lead to economic growth. Setting
up 9000 km of economic corridor, monetization of a total of 12 lots of highway bundles by 2024,
more Tejas-like trains, Delhi-Mumbai expressway completion by 2023 and developing 100 more
airports by 2024 are some of the major promises made by the government.
In the line of positive moves, one major proposal is also that there will be 100% tax exemptions
on Sovereign wealth Funds’ investments on infrastructure projects. Which is basically an
invitation for big-budget projects to invest in India without any taxes.
In what’s more expensive and what’s getting cheaper
Imported military equipment prices will be reduced. Certain mobile components that are made in
India and fingerprint reader have gotten cheaper. Unfortunately, imported refined vegetable oil
and chewing tobacco also got expensive. Imported headphones, PCB of mobile phones, glass
beads, artificial flowers, wooden furniture, toys, household appliances, combs, hairpins, and
most importantly imported electric vehicles and parts got expensive.
Fundraising through LIC IPO
Government plans to raise funds through LIC IPO which is going to be controversial since the
chairman of LIC, MR Kumar had said in November 2019 that there is no need to sell LIC now.
He was saying that there is still a scope of growth in LIC despite the slowdown. It is also quite
evident with the 45% premium growth in the first 9 months of FY18 as opposed to premium
growth in the private sector which was around 20.7%. This means LIC is a profit-making PSU
and yet the government is planning to sell it while the initial plan for disinvestment was to sell
non-strategic PSUs which seems to be not working.
ESOP taxation
Until now, the rule was that whether you apply for stock options or not, you had to pay the taxes.
The new rule says that now you only have to pay if you exercise your tax options or sell your
stocks or leave the company.
These are small moves that were not implemented earlier but can help Startup India to grow if
executed well.
Also, the FM has not said anything about long term capital gain stocks and that the stock market
remained 1000-points down.
Wondering what to do in such a market scenario?
Along with his unboxing of the budget 2020, Akash Banerjee talks about a shining ray of hope
for new and seasoned investors alike – Upstox. You can invest in stocks, build your long-term
savings, beat inflation, and that too at home with your phone. A successful start-up, now
supported by industrialists like Ratan Tata, it also provides 0 brokerage for long term
investments. Very soon, it will also provide the ability to spend in global markets.
Upstox is also offering free opening of Demat account for a limited period of time! To avail this
opportunity, click on the link in the description of Akash’s ‘Unboxing Budget 2020 – Highlights
& Analysis’ video.
You also get several trading tips and free advisory services worth upto Rs. 28,000 along with a
user-friendly app that is available in Hindi as well.
Improve the Economy by investing right. Invest in shares and mutual funs in such successful
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