{"id":1743,"date":"2021-02-04T10:07:15","date_gmt":"2021-02-04T04:37:15","guid":{"rendered":"https:\/\/knowledgekart.in\/blog\/?p=1743"},"modified":"2021-02-04T10:08:58","modified_gmt":"2021-02-04T04:38:58","slug":"budget-2021-highlights-for-upsc-ias-summary-and-key-pointers","status":"publish","type":"post","link":"https:\/\/knowledgekart.in\/blog\/budget-2021-highlights-for-upsc-ias-summary-and-key-pointers\/","title":{"rendered":"Budget 2021 Highlights For UPSC IAS , Summary and Key Pointers"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><strong>Budget 2021 Highlights, Summary and Key Pointers:<\/strong> The Union Minister for Finance &amp; Corporate Affairs, Smt Nirmala Sitharaman presented the Union Budget 2021-22 in Parliament today, which is the first budget of this new decade and also a digital one in the backdrop of unprecedented COVID-19 crisis. Laying a vision for Aatma Nirbhar Bharat, she said this is an expression of 130 crore Indians who have full confidence in their capabilities and skills. She said that Budget proposals will further strengthen the Sankalp of Nation First, Doubling Farmer\u2019s Income, Strong Infrastructure, Healthy India, Good Governance, Opportunities for youth, Education for All, Women Empowerment, and Inclusive Development among others. Additionally, also on the path to fast-implementation are the 13 promises of Budget 2015-16-which were to materialize during the Amrut Mahotsav of 2022, on the 75th year of our Independence. They too resonate with this vision of Aatma Nirbharta.. Budget 2021 Highlights For UPSC IAS , Summary and Key Pointers<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Macroeconomic Indicators<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Nominal growth of GDP &#8211;<\/strong> 10% (2020-21). Nominal GDP is an assessment of economic production in an economy that includes current prices in its calculation.<\/li><li><a href=\"https:\/\/www.drishtiias.com\/daily-updates\/daily-news-editorials\/assessment-of-make-in-india\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Fiscal deficit<\/strong><\/a> &#8211; 3.8% of GDP (2019-20), 3.5% of GDP (2020-21).<br><ul><li>The estimation for the FY20 was at 3.3%, thereby <strong>deviating from the target set in the fiscal path.<\/strong><\/li><li>The Government has made use of <strong>Section 4 of the FRBM (Fiscal Responsibility and Budget Management) Act<\/strong> which provides a trigger mechanism for a <strong>deviation from the estimated fiscal deficit<\/strong> on account of structural reforms in the economy with unanticipated fiscal implications.<\/li><li><strong>Reasons:<\/strong> The increase in deficit estimate is mainly on account of the shortfall in revenue collection. The government on its part has lowered its expenditure on many of the heads. For example, food subsidy in the budget estimate 2019-20 was over \u20b91.84 lakh crore, which has been lowered to \u20b91.08 lakh crore in the revised estimate<\/li><li><strong>Fiscal deficit, by definition,<\/strong> is the difference between a government&#8217;s revenue receipts plus non-debt capital receipts (NDCR) and its total expenditure.<\/li><li>Fiscal deficit occurs when a government collects lesser money &#8211; in terms of personal and corporate taxes, GST, market loans and NDCR (money received from sale of old assets) etc. &#8211; than it spends, on items such as central sector schemes, salaries of employees, subsidies, payments to states and so on.<\/li><li>According to the <strong>Fiscal Responsibility and Budget Management Act<\/strong> in India, the recommended<strong> fiscal deficit should be 3% of GDP.<\/strong><\/li><\/ul><\/li><li><strong>Revenue deficit-<\/strong> 2.7% of GDP (2020-21). By definition, revenue deficit is the excess of revenue expenditure over revenue receipts.<\/li><li><strong>Size of Economy:<\/strong> India is now the <strong>fifth largest economy<\/strong> of the world in terms of GDP.<\/li><li><strong>Growth and Inflation:\u00a0<\/strong>7.4% average growth clocked during 2014-19 with <a href=\"https:\/\/www.drishtiias.com\/daily-updates\/daily-news-editorials\/return-of-inflation\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>inflation<\/strong><\/a> averaging around 4.5%.<\/li><li><strong>Poverty alleviation:<\/strong> 271 million people raised out of poverty during 2006-16.<\/li><li><strong>FDI:<\/strong> India\u2019s <a href=\"https:\/\/www.drishtiias.com\/daily-updates\/daily-news-analysis\/revised-fdi-norms\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>Foreign Direct Investment<\/strong><\/a> <strong>elevated<\/strong> to US$ 284 billion during 2014-19 from US$ 190 billion during 2009-14.<\/li><li><strong>Central Government debt reduced<\/strong> to 48.7% of GDP (March 2019) from 52.2% (March 2014).<\/li><li>Budget 2021 Highlights For UPSC IAS<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Two cross-cutting developments:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Proliferation of technologies<\/strong> (Analytics, Machine Learning, robotics, Bioinformatics and Artificial Intelligence).<\/li><li><strong>Highest ever number of people in the productive age group<\/strong> (15-65 years) in India.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/www.drishtiias.com\/daily-updates\/daily-news-analysis\/j-k-and-15th-finance-commission\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>15<sup>th<\/sup> Finance Commission<\/strong><\/a> has<strong> cut state share of central taxes to the states<\/strong> by one percentage point to 41%.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>This is due to the <a href=\"https:\/\/www.drishtiias.com\/daily-updates\/daily-news-analysis\/article-370-and-35-a-revoked\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>newly formed Union Territories of Jammu and Kashmir, and Ladakh,<\/strong><\/a> which will get funds from the Centre\u2019s<\/li><\/ul>\n\n\n\n<ul class=\"wp-block-list\"><li>share, which means <strong>devolution will be for 28 states compared to 29 earlier.<\/strong><\/li><li>42% was recommended by the 14<sup>th<\/sup> Finance Commission<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Changes in Taxation<\/h3>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Dividend Distribution Tax (DDT) removed.<\/strong> Instead of companies paying DDT on the dividend they give out, the <strong>dividend income will now be added to the taxable income of the recipient,<\/strong> and taxed at the applicable rate.<\/li><li><strong>Income Tax<\/strong><br><ul><li>New tax slabs and lower income tax rates. Around 70 of the existing exemptions and deductions to be removed in the new simplified regime.<\/li><li>New tax regime to be optional &#8211; an individual may continue to pay tax as per the old regime and avail deductions and exemptions.<\/li><\/ul><\/li><\/ul>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" width=\"643\" height=\"358\" src=\"https:\/\/knowledgekart.in\/blog\/wp-content\/uploads\/1580727931_image1.png\" alt=\"\" class=\"wp-image-1744\" title=\"\" srcset=\"https:\/\/knowledgekart.in\/blog\/wp-content\/uploads\/\/1580727931_image1.png 643w, https:\/\/knowledgekart.in\/blog\/wp-content\/uploads\/\/1580727931_image1-600x334.png 600w, https:\/\/knowledgekart.in\/blog\/wp-content\/uploads\/\/1580727931_image1-300x167.png 300w\" sizes=\"(max-width: 643px) 100vw, 643px\" \/><figcaption><\/figcaption><\/figure>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>Corporate Tax:<\/strong> Concessional corporate tax rate of <strong>15% to new domestic companies in manufacturing and power sector.<\/strong><\/li><li><strong>5% health cess<\/strong> to be imposed on imports of medical equipment given these are made significantly in India.<\/li><li>Issuance of <strong>Unique Registration Number<\/strong> to all charity institutions for easy tax compliance.<\/li><li><strong>\u2018Vivad Se Vishwas\u2019<\/strong> scheme, with a deadline of 30<sup>th<\/sup> June, 2020, to reduce litigations in direct taxes.<\/li><li><strong>100% tax exemption<\/strong> to the interest, dividend and capital gains income on investment made in infrastructure and priority sectors before 31<sup>st<\/sup> March, 2024 with a minimum lock-in period of 3 years by the Sovereign Wealth Fund of foreign governments.<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"http:\/\/upsc.gov.in\" target=\"_blank\" rel=\"noopener\">UPSC<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"http:\/\/knowledgekart.in\/blog\">Blog<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Budget 2021 Highlights, Summary and Key Pointers: The Union Minister for Finance &amp; Corporate Affairs, Smt Nirmala Sitharaman presented the Union Budget 2021-22 in Parliament today, which is the first&hellip;<\/p>\n","protected":false},"author":1,"featured_media":1746,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[117,55,53,54],"tags":[],"class_list":["post-1743","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economics","category-g-k","category-ias","category-upsc"],"_links":{"self":[{"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/posts\/1743","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/comments?post=1743"}],"version-history":[{"count":0,"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/posts\/1743\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/media\/1746"}],"wp:attachment":[{"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/media?parent=1743"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/categories?post=1743"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/knowledgekart.in\/blog\/wp-json\/wp\/v2\/tags?post=1743"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}