Budget 2024 Live Updates: Finance Minister Nirmala Sitharaman’s Union Budget 2024 saw her announcing several key projects across agriculture, manufacturing and services sector. She also announced major changes in the capital gains tax regime and income tax regimes. “The people have given a unique opportunity to our government to take the country on the path of strong development and all-round prosperity. In the interim budget, we promised to present a detailed roadmap for our pursuit of ‘Viksit Bharat’,” FM Nirmala Sitharaman.
She outlined nine key areas of focus for the government:
- Productivity and resilience in Agriculture
- Employment & Skilling
- Inclusive Human Resource Development and Social Justice
- Manufacturing & Services
- Urban Development
- Energy Security
- Infrastructure
- Innovation, Research & Development
- Next Generation Reforms
Sitharaman also made significant announcements for Bihar and Andhra Pradesh, including increased infrastructure investment and special financial assistance. The announcement encompasses human resource development, infrastructure, and the creation of economic opportunities to transform the eastern region of the country, which includes Bihar, Jharkhand, West Bengal, Odisha, and Andhra Pradesh, into a driving force for achieving Viksit Bharat. Budget 2024 announced several measures on education and job creation.
“This budget details some of the specific actions to be initiated in the current year towards fulfilment of these priorities with potential for transformative changes. The budget also covers some of the previously made announcements with an intent to strengthen them and step up their implementation for expediting our journey towards the goal of Viksit Bharat,” Sitharaman said.
Furthermore, the government announced a comprehensive review of the Income Tax Act to improve its clarity and readability. Sitharaman also announced changes to the new tax regime slabs and an increase in the standard tax deduction from Rs 50,000 to Rs 75,000. Track TOI’s Budget 2024 live blog for insightful coverage on Budget 2024, FM Sitharaman’s key announcements and expert analysis.
20:46 (IST) Jul 24
“As anticipated, the 2024 union budget highlights the priority given to the solar and renewable energy sectors. Notably, the PM Suryaghar Muft Bijli Yojana, which aims to install ten million rooftop solar panels, stands out as a significant advancement. This initiative could greatly benefit India’s solar PV module manufacturers. Furthermore, removing solar glass, glass, and copper wire connectors from the custom duty exemption list is a prudent measure. This decision is crucial to supporting the burgeoning domestic industry. Nevertheless, additional efforts are needed to accelerate the full development of manufacturing capabilities, for the entire manufacturing process (that is from polysilicon manufacturing to module assembly), which requires urgent support in areas like labor regulations, technology imports, land, and infrastructure. Swift action on these fronts is essential for India to meet its ambitious domestic production targets amidst numerous ongoing projects.”“Pumped storage for power is another vital area with the potential for substantial savings and more efficient power generation utilization. We expect the new policy introduced by the Finance Minister in today’s budget to attract further investments and create new opportunities for manufacturers.”
Visweswara Reddy, Chairman & Managing Director, Shirdi Sai Electricals Limited Group
14:27 (IST) Jul 24
Budget 2024 Live: Rs 1.52 lakh crore allocated for agriculture and allied sectors
In the Budget for 2024-25, the government prioritized ‘productivity and resilience’ with Rs 1.52 lakh crore allocated for agriculture and allied sectors. Measures include promoting horticultural output, implementing Digital Public Infrastructure (DPI) in 400 districts, and introducing 109 high-yield, climate-resistant crop varieties. The plan aims to expand natural farming among one crore farmers over two years. DPI will digitize farmer and land registries for six crore farmers, aiding precise crop estimates from the upcoming kharif season. The budget also focuses on developing vegetable clusters near consumption hubs and achieving self-sufficiency in pulses and oilseeds through enhanced production, storage, and marketing, alongside establishing nucleus breeding centres for Shrimp Broodstocks.
12:30 (IST) Jul 24
Budget 2024 Live: Mallikarjun Kharge calls Union Budget “discriminatory”
“This Budget is discriminatory and unfair. They (BJP) are saying that they allotted special package to Bihar to build roads but roads are built anyway. All of this is deceptive,” he said.
No state got anything in the budget of Modi government. The states where people have rejected BJP, those states got nothing from this budget! Everyone’s plate is empty, and in the plate of two states there are “Pakora” and “Jalebi”! This budget has been brought only to save his chair. The Finance Minister is elected from Karnataka, we expected that we would get the maximum. INDIA Alliance opposes this budget,” he said in a post on X.
12:01 (IST) Jul 24
Budget 2024 Live: A shift from focusing on fiscal deficit to prioritizing the debt-GDP ratio for fiscal management
The government signaled a shift from focusing on fiscal deficit to prioritizing the debt-GDP ratio for fiscal management. Despite keeping the fiscal deficit at 4.9% of GDP for 2024-25, lower than earlier estimates, Finance secretary TV Somanathan emphasized reducing the debt-GDP ratio over fixed deficit targets. This approach accounts for India’s rapid economic growth compared to slower-growing economies.
Finance minister Nirmala Sitharaman pledged further fiscal consolidation, aiming for a deficit below 4.5% next year and declining central government debt post-2026-27. Robust tax revenues and a substantial RBI dividend payout supported these fiscal goals, which were welcomed by ratings agencies for policy continuity.
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11:18 (IST) Jul 24
In the Budget for 2024-25, finance minister Nirmala Sitharaman has significantly boosted capital expenditure while projecting a reduced fiscal deficit without increasing borrowing. Revenue receipts are set to rise by 15%, reaching Rs 31.3 lakh crore, bolstered by higher tax collections, particularly from individual income taxes. Non-tax revenues, driven by increased dividends from public sector entities and the RBI, are expected to surge by 70%. Conversely, capital receipts are slightly down due to reduced borrowing. Total receipts are forecasted to increase by 8.5% to Rs 48.2 lakh crore. This has allowed for substantial allocation of Rs 15 lakh crore for effective capital expenditure, while lowering fiscal deficit to 4.9% of GDP and reducing the revenue deficit to 1.8%.
10:25 (IST) Jul 24
Budget 2024 Live: Sagarika Ghose, Sandeep Pathak criticise the Union Budget 2024
“In this Budget, the NDA government did not follow cooperative and competitive federalism. The government has done discriminatory federalism in the Budget as only two states – Andhra Pradesh and Bihar, who are coalition partners of the Centre, have been given everything… infrastructure projects, financial package. Other states like West Bengal, Tamil Nadu, Maharashtra Kerala have not been given anything. They all are protesting. This Budget is ‘Modi Bachao Budget, Kursi Bachao Budget,” said Sagarika Ghose
“The biggest lacking of the Budget is that it does not have a vision. You are in power for over 10 years, you should have a roadmap to identify the sectors that needs development. Where is your roadmap, what is your vision?” said AAP MP Sandeep Pathak
09:35 (IST) Jul 24
Budget 2024 Live: 1.52 lakh crore allocated for agriculture and allied sectors in FY25
The finance minister allocated Rs 1.52 lakh crore for agriculture and allied sectors in FY25, constituting 3.1% of the total expenditure of Rs 48.2 lakh crore, a marginal increase from FY24’s Rs 1.4 lakh crore. Concerns arise as this adjustment barely covers inflation. Plans to transition one crore farmers to natural farming over two years were announced, juxtaposed against the Rs 1.64 lakh crore earmarked for fertiliser subsidies in FY25, exceeding the entire agriculture budget. This highlights a discrepancy between promoting sustainable practices and subsidising urea, known for low crop absorption efficiency and environmental impact through ammonia emissions and groundwater contamination.
08:50 (IST) Jul 24
Budget 2024 Live: Scheme benefitting 63,000 tribal villages launched
The government is launching the Pradhan Mantri Janjatiya Unnat Gram Abhiyan to enhance socio-economic conditions for tribal communities across 63,000 villages, benefiting five crore tribals. Finance Minister Nirmala Sitharaman emphasized full coverage in tribal-majority villages and aspirational districts. The initiative includes boosting economic support schemes for craftsmen, artisans, self-help groups, scheduled castes, tribes, women entrepreneurs, and street vendors like PM Vishwakarma, PM SVANidhi, and National Livelihood Missions. The budgetary allocation for the tribal affairs ministry for 2024-25 is Rs 13,000 crore, a significant increase reflecting the government’s commitment to tribal welfare, despite previous revisions and estimates indicating fluctuating support levels in recent years.
07:43 (IST) Jul 24
Budget 2024 Live: Airplane industry to be simplified to promote tourism
India plans to simplify aircraft leasing for domestic carriers, aiming to bolster tourism and increase passenger numbers. Additionally, the country will incentivize the domestic performance of aircraft maintenance, repair, and overhaul (MRO) services, currently predominantly outsourced abroad. These initiatives are part of a broader strategy to enhance the aviation sector’s capabilities domestically, potentially reducing costs and boosting efficiency in air travel operations within India.
“We will seek the required legislative approval for providing an efficient and flexible mode for financing leasing of aircrafts and ships, and pooled funds of private equity through a ‘variable company structure’.” Regarding MRO, she said: “To promote domestic aviation and boat & ship MRO, I propose to extend the period for export of goods imported for repairs from six months to one year. In the same vein, I propose to extend the time-limit for re-import of goods for repairs under warranty from three to five years,” finance minister Nirmala Sitharaman said.
07:16 (IST) Jul 24
Budget 2024: What is there for the travelers
In a bid to bolster cruise tourism, the government proposed a simplified tax framework for foreign shipping firms operating domestic cruises. Finance minister Nirmala Sitharaman highlighted India’s substantial potential in cruise tourism, aiming to stimulate job creation and economic growth.
She underscored tourism’s historical significance and its role in positioning India as a global destination, promising enhanced infrastructure for pilgrimage sites like Vishnupad and Mahabodhi temples.
Additionally, she outlined development plans for Rajgir and Nalanda in Bihar, emphasizing their cultural and religious importance. The budget earmarked Rs 2,479.6 crore for tourism, up from Rs 1,692.1 crore in the previous year, aiming to boost sectoral investment and job opportunities.
“Tourism has always been a part of our civilisation. Our efforts in positioning India as a global tourist destination will also create jobs, stimulate investments and unlock economic opportunities for other sectors,” she said.
03:45 (IST) Jul 24
Budget 2024: Wait for tax refund may irk you more
This is one budget proposal that may disappoint taxpayers. Not only has the period of withholding of tax refund been extended, but you may also lose out on interest paid for a delayed refund.
Currently, if you file an I-T return claiming a refund, and assessment proceedings are pending for any earlier year, the I-T officer can withhold the refund till the completion of earlier year’s assessment if they think that the ‘interest of the revenue will be adversely affected’. But, the officer has to obtain the commissioner’s nod.
01:23 (IST) Jul 24
Budget 2024: Silver generation gets a sliver of relief on pension
There was some good news from the Budget for seniors as well, with the standard deduction for family pensioners being raised from Rs 15,000 to Rs 25,000.
In addition, the FM indicated the Centre’s commitment to guarantee a certain return for govt employees under the New Pension Scheme, pointing to “considerable progress” made by a panel headed by finance secretary TV Somanathan.
“A solution will be evolved which addresses the relevant issues while maintaining fiscal prudence to protect common citizens,” she said.
00:43 (IST) Jul 24
Budget 2024 Live: Rajasthan gets new industrial park in Union Budget 2024
Rajasthan has received a major industrial park in the first Budget of the BJP-led government at the Centre, with the state receiving Rs 7,000 crore more as a share of Central taxes this time.
Among the 12 new industrial parks being announced by Union Finance Minister Nirmala Sitharaman, the Jodhpur Pali Marwar Industrial Area has been sanctioned for Rajasthan under the National Industrial Corridor Development Programme.
The park stands significant for the industrial development in western Rajasthan as around 40,000 people will get direct employment out of it.
The project will be developed near the Delhi-Mumbai Industrial Corridor and is located at an equal distance (30 km) from Jodhpur and Pali City.
This project will be developed on 1,578 acres with an estimated cost of Rs 922 crore.
00:17 (IST) Jul 24
Budget 2024 Live: Union Budget does not take into account Karnataka’s demands, CM Siddaramaiah
Karnataka Chief Minister Siddaramaiah said that Union Finance Minister Nirmala Sitharaman has presented a disappointing budget without acknowledging any demands of the state.
Addressing a press conference on Tuesday, he said that Nirmala Sitharaman has given a ‘Chombu’ (Empty vessel) to the people of the state by completely ignoring their interest. He stated that the Prime Minister has given special grants to the states of Andhra Pradesh and Bihar to maintain his power while neglecting other states.
Chief Minister Siddaramaiah said, “In the pre-budget meeting, the state government had put forward several requests. However, the Union Finance Minister has not responded to any of the demands. Nirmala Sitharaman had announced in the previous budget to provide Rs. 5300 crore in grants for the Upper Bhadra Project. It was requested again in this budget, but no money has been provided for this project. The government is providing Rs. 5,000 crore this year for the comprehensive development of Kalyana Karnataka.”
23:44 (IST) Jul 23
Budget 2024 Live: “Budget for strengthening NDA coalition,” says Kerala Finance Minister
Kerala Finance Minister KN Balagopal hit out at the Centre over the Union Budget and said that Finance Minister Nirmala Sitharaman made no announcement of any special package for the southern state.
Addressing a press conference in Thiruvananthapuram, KN Balagopal said, “The first budget of the Modi government (3.0) is totally disappointing for the state. It is not only for the state but for the entire country. We expected that some kind of new measures will be there for more employment. For more economic activity and development.”
“For farmers, for youth, and for different sectors. We expected that something more would be there. The economy will boost after the elections…that is what we expected,” he said.
23:30 (IST) Jul 23
Budget 2024 Live: ‘Enhancement of farmers’ income will have an impact’, says former CMD of Indian Overseas Bank, M Narendra
“Due to climate change and all, the agriculture sector is not doing that well. The enhancement of farmers’ income will have an impact on consumption demand. That way, the priority on agriculture has been given.”
23:15 (IST) Jul 23
Budget 2024 Live: ‘A very progressive Budget’, says Anarock Chairman, Anuj Puri
“It’s a very progressive Budget. Clearly, the Budget is focused on job, growth, opportunities, startups, women, infrastructure, development, and how do you bring in more industrial output into India. It aims to increase industrial output in India. The continuation of this government’s third phase is evident, emphasising the need to create more jobs, infrastructure, and development. That thought has continued.”
23:00 (IST) Jul 23
Budget 2024 Live: Union minister Ashwini Vaishnaw says, ‘Budget makes provisions for middle-class to fulfil home ownership dreams’
Union minister Ashwini Vaishnaw highlighted that the 2024-25 budget includes significant measures to simplify tax rates, reduce taxes, and help middle-class families achieve homeownership. “This budget simplifies tax rates, works on reducing them, and helps middle-class families build their own homes,” he told ANI.
Vaishnaw emphasized the budget’s Rs 2 lakh crore allocation to create employment opportunities, focusing on internships and boosting the manufacturing sector. “This budget provides Rs 2 lakh crore for employment opportunities, including internships and jobs in manufacturing,” Vaishnaw said.
The budget also includes special provisions for the MSME sector, such as credit guarantees and cash flow-based credit assessments, addressing key challenges faced by small business owners.
Finance minister Nirmala Sitharaman presented her seventh consecutive Union Budget, making history. Key priorities include productivity and resilience in agriculture, employment and skilling, urban development, and infrastructure. Sitharaman announced income-tax reforms, an increased standard deduction, and revised tax rates for salaried individuals.
The budget proposes creating employment for 4.1 crore youth over the next five years, with Rs 2 lakh crore allocated for this purpose. Additionally, Rs 1.48 crore is proposed for skilling 20 lakh youth and upgrading 1,000 industrial training institutes.
22:45 (IST) Jul 23
Budget 2024 Live: Congress criticises Union budget 2024, announces boycott of NITI Aayog meeting
Congress general secretary KC Venugopal criticised the Union budget 2024 as discriminatory and announced that INC chief ministers would boycott the NITI Aayog meeting on July 27. On social media platform X, Venugopal said, “The Union budget presented today was extremely discriminatory and dangerous, which completely goes against the principles of federalism and fairness that the Union government must follow. In protest, INC CMs will be boycotting the NITI Aayog meeting scheduled for 27th July.” He further added that the government’s attitude was antithetical to constitutional principles and that the party would not participate in an event designed to conceal the regime’s discriminatory nature.
After finance minister Nirmala Sitharaman presented the first Budget in Narendra Modi 3.0, opposition parties termed it a “Kursi Bachao Budget,” while ruling parties called it a roadmap for a “Viksit Bharat.” Sitharaman made history by presenting seven consecutive budget speeches, surpassing former Prime Minister Morarji Desai’s record of six consecutive budgets between 1959 and 1964.
Sitharaman outlined key priorities in the 2024-25 Union Budget, focusing on fostering economic growth and creating opportunities, with priorities including productivity and resilience in agriculture, employment and skilling, and services. However, the opposition criticised the budget heavily. Rahul Gandhi accused the finance minister of making hollow promises.
Mallikarjun Kharge called the budget a “save Modi government” budget and criticised it for distributing half-hearted “rewadis” to coalition partners. P Chidambaram noted missed opportunities in the budget but welcomed the adoption of Congress’ Employment-Linked Incentive (ELI) and Apprenticeship scheme and the move to abolish the Angel Tax, a long-standing Congress demand.
Samajwadi Party chief Akhilesh Yadav labelled the budget a ploy to retain power by mentioning special projects for Bihar and Andhra Pradesh, questioning what the BJP had done for farmers and youth over the last decade. Congress leader Jairam Ramesh highlighted the government’s failure to conduct the Census and noted the absence of funds for the decadal Population Census, which was supposed to take place in 2021.
West Bengal CM Mamata Banerjee also slammed the budget, calling it politically motivated, directionless, anti-people, and lacking vision. “Directionless, anti-people, no vision, only political mission is there. I don’t see any light, it is dark,” she said.
22:30 (IST) Jul 23
Budget 2024 Live: Delhi minister Aatishi slams Union budget allocation, says, ‘Delhi contributes over ₹2 lakh crore in taxes but receives just 0.4% back’
Delhi’s finance minister and AAP leader, Aatishi, expressed strong discontent with the Union budget, stating that it has once again “betrayed” the people of the national capital. Despite Delhi contributing over Rs 2 lakh crore in income tax and Rs 25,000 crore in central GST, the city did not receive any share of central taxes or funds for the Municipal Corporation of Delhi (MCD).
Addressing the media, Aatishi emphasized that Delhi is a major growth engine for the country, yet it received no financial support from the BJP-led central government. She highlighted that Delhi was seeking just Rs 20,000 crore, a mere 0.4% of the Union budget, but was left empty-handed. Last year, Delhi residents paid Rs 2.07 lakh crore in income tax, underscoring the city’s significant contribution to the national economy. Aatishi accused the central government of neglecting Delhi for the past 11 years, despite its substantial contributions. She pointed out that while other states received their share of central taxes, Delhi was excluded.
According to the budget document, Rs 1.24 lakh crore was allocated to various states, and Rs 82,207 crore was designated for local bodies, both urban and rural, but none of this was allocated to Delhi. Aatishi challenged the BJP to show any significant contributions made to Delhi in the last 11 budgets presented by its government at the Centre. She contrasted this with the efforts of the Arvind Kejriwal government, which, despite limited resources and numerous challenges, provides essential services like 24-hour electricity, good schools, hospitals, and free bus travel for women.
Meanwhile, Delhi BJP president Virendra Sachdeva praised the Union budget as “holistic” and “development-oriented,” benefiting all sections of society, particularly youth and women. He claimed the increase in Pradhan Mantri Awas Yojana allocation is unlikely to benefit Delhi’s financially weaker sections due to the Kejriwal government’s failure to implement it. The allocation for the Government of National Capital Territory of Delhi in the Union budget 2024-25 remained stagnant at Rs 1,168 crore, with no grants in lieu of its share in central taxes.
22:15 (IST) Jul 23
Budget 2024 Live: HM Amit Shah praises Union budget for youth training and employment initiatives
Union home minister Amit Shah praised the 2024-25 Union budget for its initiatives aimed at youth training and employment. Shah highlighted the government’s plan to provide world-class training to 1 crore youth through internships in the top 500 companies, calling it a game-changing move. He shared on social media platform X that the budget allocates Rs 2 lakh crore to train 4.10 crore youth in various skills.
Shah thanked Prime Minister Narendra Modi for these new employment initiatives, using the hashtag #BudgetForViksitBharat to emphasize the goal of making India a developed country. He also expressed gratitude to PM Modi for doubling the Mudra loan limit from Rs 10 lakh to Rs 20 lakh, which he believes will support small and women entrepreneurs in becoming job creators.
Finance Minister Nirmala Sitharaman, presenting her seventh consecutive budget, outlined key priorities such as agriculture productivity, employment and skilling, human resource development, and next-generation reforms. Sitharaman proposed significant income tax reforms and announced an allocation of Rs 2 lakh crore to create jobs for 4.1 crore youth over the next five years, along with Rs 1.48 crore for skilling initiatives.
22:00 (IST) Jul 23
Budget 2024 Live: ‘Balanced budget which lays out the blueprint for Viksit Bharat’, says, managing director of JK Paper Ltd, Harsh Pati Singhania
“I think it’s a good Budget, it is balanced Budget and it also lays out the blueprint for ‘Viksit Bharat’… There is a lot of focus on job creation and skilling because that is essential. Unless you create, how are you going to grow the economy? The focus is also on the farm and agri sector.”
21:45 (IST) Jul 23
Budget 2024 Live: ‘Very thoughtful budget’, says President & managing director of Volvo Group India Private Limited, Kamal Bali
“It is a very thoughtful budget and it has addressed various sections of the economy and society like employment generation, manufacturing, rural economy, infrastructure, agriculture.
It is a growth-oriented budget. Taxation will be rationalised which is very important for the nation and the government.”
21:30 (IST) Jul 23
Budget 2024 Live: ‘Wholeheartedly applauds the visionary budget’ says, director & co-founder of Zishta, Meera Ramakrishnan
“Zishta wholeheartedly applauds the government’s visionary budget, which places a strong emphasis on rural development and skill development. The allocation of ₹2.66 lakh crore for rural development is a significant step towards empowering our artisans and craftsmen. We are particularly excited about the proposed e-commerce export hubs, which will provide a much-needed platform for MSMEs and traditional artisans like us to reach global markets.
The focus on developing 100 weekly haats is also commendable, as it will create new opportunities for artisans to showcase their products to a wider audience. Schemes like PM Swanidhi and MGNREGA have already proven effective in uplifting rural communities, and we believe that the government’s continued commitment to these initiatives will lead to a brighter future for India’s artisans.
We are confident that these measures will not only revitalize rural economies but also contribute to preserving and promoting our rich cultural heritage.”
21:15 (IST) Jul 23
Budget 2024 Live: ‘Puts comprehensive focus on housing and rural development’, says MD & CEO of LIC Housing Finance, Tribhuwan Adhikari
“The Union budget has put comprehensive focus on housing and rural development alongside the economic growth narrative. The allocation of ₹2.66 lakh crore for rural infrastructure and the construction of 3 crore additional houses under the PM Awas Yojana in both rural and urban areas are complementary and would significantly boost housing demand. Rental housing has received the attention and will improve the housing stock.
Other positives are digitization of land records, PM Surya Ghar Muft Bijli Yojana, encouraging states on moderation of high stamp duty rates and considering lower stamp duty on properties purchased by women. These measures will stimulate the housing market, driving demand and fostering socio-economic growth.”
21:00 (IST) Jul 23
Budget 2024 Live: ‘Delighted about reduction in import duties of precious metals’, says chairman and managing director of PNG Jewellers, Saurabh Gadgil
“We are delighted to learn about the significant reduction in import duties for gold, silver to 6%, and Platinum to 6.4%. This decision, which aligns with the industry’s long-standing request, is expected to have a positive impact on the organization and growth of the industry. By lowering import duties, we anticipate an increase in gold consumption and a moderation in gold prices, which have recently reached record highs.
Furthermore, this move is not only beneficial for the industry but also provides relief to consumers. It represents a substantial step towards enhancing industry transparency and curbing illegal smuggling activities. We wholeheartedly welcome this decision and look forward to its positive effects on the industry and the market.”
20:45 (IST) Jul 23
Budget 2024 Live: ‘Aimed at boosting youth employment and skills development’ says, MD of Ladderup Wealth Management, Raghvendra Nath
“The budget announcement was largely as anticipated, emphasizing fiscal consolidation with a target fiscal deficit of 4.9% for FY 24-25. It introduces measures aimed at boosting youth employment and skills development and has allocated a significant Rs 1.52 lakh crore for agricultural and allied sectors. Infrastructure continues to be a focus area with 3.4% of GDP (totalling 11.11 lakh crore) earmarked for this critical sector. Additionally, new schemes and measures have been introduced to bolster manufacturing, services, and the energy sector. The budget also includes supplementary allocations to Bihar and Andhra Pradesh to boost capital investment. The middle class received marginal relief with an increased standard deduction of Rs 75,000 for salaried individuals under the new regime and a higher exemption limit on LTCG raised from Rs 1 lakh to Rs 1.25 lakh.
Reductions in customs duties on gold and silver are anticipated to benefit domestic companies by potentially lowering the prices of these precious metals. Initial market response has been negative due to the increase in LTCG tax on listed equities to 12.5% from 10%, an increase in STCG to 20% from 15%, and higher STT rates on Futures & Options at 0.02% and 0.1%, respectively.”
20:30 (IST) Jul 23
Budget 2024 Live: ‘Government killed two birds with one stone’, says co-founder and COO of Appreciate, Shlok Srivastav
“In all fairness, markets and the business ecosystem were anticipating some bid at ‘rationalisation’ of the long-term and short-term capital gains tax rates. The drastic revision of STCG from 15% to 20% makes sense given that there have been renewed murmurs vis-a-vis the overheating of the derivatives market. The recent statement by the market regulator that the growth in trading volume has now leapfrogged to a macro-level concern from being a micro-one was a big hint that the government was actively looking to temper and moderate the action in the derivatives segment.
Having said that, one must tip their hat to the government for killing two birds with one stone with the revision in LTCG. For serious long-term investors, the increase from 10% to 12.5% would hardly make a dent in the larger accounting of gains. At the same time, it will nudge investors into entering Indian markets with a reasonably long-term outlook and encourage them to step up as actual stakeholders in the Indian growth story. Sure, the LTCG hike would be a market sentiment dampener for some time but as we know from hindsight, capital market players are going to take this move into stride and move on.
On the macro level, the government must be credited for keeping its eye on the prize, namely, maintaining fiscal discipline. There was a larger expectation amongst economists that the budget would be pro-welfare, to the extent that it would skew the fiscal balance. With the fiscal deficit targeted at 4.9%, the government has reaffirmed its commitment to the fiscal glide path, and this is music to the ears of foreign investors and rating agencies. Effectively, it will bring in liquidity and a lower cost of capital for India.”
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