Union Budget 2019 vs 2018
The Union Budget for FY2019 is just four weeks away, and the process of drafting the budget is in full swing at the Finance Ministry. Security has been beefed up, and roughly 100 officials are in lockdown in the North Block of the Ministry. These officials are not allowed to speak to external people (including their family members) until the final budget is drafted and printed. There is much secrecy, and not a lot of information is available before the budget is announced. So in this piece, let’s look at the Union Budget for FY2018 and what you can expect in the upcoming one.
Takeaways from Union Budget 2018
The Union Budget for FY2018 was the last full-fledged budget announced by the Finance Ministry before the general elections. Moreover, as expected by most analysts, the budget was a populist one. It included many schemes and measures that were in line with the government’s overall vision of strengthening agriculture, health and education, employment, rural development and the MSME sector.
This includes:
- a) The world’s largest health protection scheme that would cover over ten crore poor and vulnerable families in the country.
- b) The outlay for health and education was Rs. 1.38 lakh crore.
- c) Ekalavya Residential Schools are to be set up in each tribal block by 2022.
- d) No change in personal income tax slabs
- e) Re-introduction of a standard deduction up to Rs. 40,000
- f) An allocation of Rs. 5.97 lakh crore for infrastructure development
- g) ‘Operation Green’: a Rs. 500 crore initiative to enhance the production of vegetables like tomato, potato and onion.
- h) Minimum Support Price (MSP) of Kharif crops would be at least 1.5 times the cost of production.
- i) Boost for senior citizens as no TDS on interest earned on FDs up to Rs. 50,000
Also read: 4 ways Budget 2018-19 affects economy according to RBI
Budget 2018 vs 2019
Unlike the budget for last year, the current budget is a non-event. This is because the budget announcement comes only a few months before a general election in the country. And in such cases, the Finance Ministry announces an interim budget instead of a full-fledged one. This budget focuses on the expenses to be incurred by the government during the transition period until the new government is formed at the centre. The new government drafts a new budget in July.
Almost everyone looks at the budget to see how it affects them during the year. And two of the most significant factors that influence people are indirect taxation and personal income tax. And indirect taxes have been unified under the Goods and Services Tax (GST). And over the past year, changes to the GST have been made beyond the purview of the Budget. For instance, just a week ago, the Prime Minister announced a reduction in GST for 23 items. Moreover, since this is the interim budget, it is doubtful that any changes would be made regarding personal tax slabs.
Also read: 7 questions to ask from the budget
Conclusion
While the upcoming budget may be more sombre than the previous one, it is still a good idea to tune in on February 1, 2019, to find out what the Finance Minister has to say one last time before the general elections.
- Use existing bank account
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