With the 2023 budget, India takes a significant stride towards being a global leader in innovation and cutting-edge technology. Since it prioritises digitalization, deep technology, and entrepreneurship, it may be essential in propelling the country forward and realising Naya Bharat's goals. This budget is incredibly forward-thinking and will provide India with a much-needed boost to help it achieve its objectives. Creating AI "Centres of Excellence" is a priority in the fiscal year 2023 budget. This will lay the groundwork for artificial intelligence in India and guarantee that it is utilised to propel the country forward. In addition, the budget’s drive on research and development will assist India to stay at the forefront of technological breakthroughs. By spending money on research and development, India will be prepared to make artificial intelligence useful and take use of its many advantages. All in all, the budget 2023 represents a big stride forward for India, and is likely to foster progress, innovation, and economic prosperity for years to come. Let's rally around this idea and do what we can to make Naya Bharat a reality.

Major announcements for Income Tax payers:

The new tax system will replace the current one as the default tax regime.

In the new tax system, the first Rs 7 lakhs of annual income are exempt from taxation.

In the proposed new tax system, the government plans to raise the income tax rebate maximum from Rs 5 lakhs to Rs 7 lakhs.

Tax rates are being restructured into four slabs.

Income below Rs 3,00,000 is exempt from tax.

New slabs under new tax regimes

Rs 0 -3 lakh- no tax

Rs 3-6 lakh -5%

Rs 6-9 lakh -10%

Rs 9-12 lakh- 15%

Rs 12-15 lakh- 20%

Indirect Taxes:

Some brands of cigarettes have a 16% higher rate of non-accidental nicotine poisoning

Within a day, 45 percent of all tax refunds were issued. Seventy-two lakh returns were the daily maximum for the taxpayer portal.

Up to March 2024, newly formed cooperatives can take advantage of a reduced tax rate of 15% if they begin production. In this proposal, we recommend lowering the standard customs duty on crude glycerine from 5% to 2.5%.

Put forth a plan to raise the import tax on silver bars to bring it in line with the rates for gold and platinum. The one-year extension of the reduction in import taxes on mobile phone components. Open cell tariffs for TV panels have been decreased to 2.5% in an effort to encourage value-added production.

Fiscal position:

The Finance Minister reaffirmed her goal of reducing the budget deficit to less than 4.5 percent of GDP by 2025–26.

The revised estimate for FY23 maintains FM's fiscal deficit objective of 6.4% but lowers it to 5.9%. 

  • Net market borrowing in FY24 is projected at Rs 11.80 lakh crore , while gross market borrowing is predicted at Rs 15.43 trillion.
  • The updated forecast for FY23 net tax collections is Rs 20.9 lakh crore.
  • The new estimate for overall spending in FY23 is Rs 41.9 lakh crore.
  • Total non-borrowing revenues for FY23 are now projected at Rs 24.3 lakh crore, while net tax revenues are expected to total Rs 23.3 lakh crore in FY24.

Saving schemes

The ceiling for the Monthly Income Scheme has been increased to Rs. 15 lakhs from Rs. 9 lakhs, and the maximum for the Senior Citizen Savings Scheme has been raised to Rs. 30 lakhs from Rs. 15 lakhs.

Mahila Samman Saving Certificates, a new savings programme for women, will be available for purchase for a limited period only, from 2019 until 2025.

MSME

With the addition of Rs 9,000 crore to the corpus, the revised credit guarantee for MSMEs will go into effect on April 1, 2023.

The new credit guarantee plan will cut the cost of lending by 1 percentage point, making it more affordable for micro, small, and medium-sized enterprises.

Banking:

The government is considering new legislation to strengthen bank oversight.

Skill training:

Government will launch Pradhan Mantri Kaushal Vikas Yojana 4.0

Thirty worldwide Skill India Centres will open in various States to prepare young people for jobs abroad.

Clean Energy:

Up to Rs 35,000 crores in urgent funding for the energy transition

Battery storage will receive viability gap funding thanks to a green credit programme that will be announced under the Environmental Protection Act.

The government will subsidise the installation of a 4,000 MwH energy storage battery.

To help with the transition to low carbon intensity, lower reliance on fossil fuel imports, and put the country in a position of technological and commercial leadership, India has allocated Rs 19,700 crore to fund the National Green Hydrogen mission.

Gems and Jewellery:

One of the IITs will get a five-year research and development funding to support the creation of a domestic lab-grown diamond industry.

Part-B of the budget statement will include a proposal to reconsider the customs duty on lab-grown diamonds.

Aviation:

To enhance regional air connection, 50 more airports, helipods, water aero drones, and sophisticated landing grounds will be resurrected.

Railways gets massive boost:

As of the end of FY24, the railway system had an allocated budget of Rs 2.4 lakh crore. This is roughly nine times the funding provided in FY14 and is the largest commitment in the history of Railways.