Budget 2022: How FM Sitharaman’s Announcements Will Impact India’s Middle Class | EXPLAINED

Budget 2022: FM Sitharaman on Tuesday said the Budget 2022 lays down the foundation to steer the economic developments with holistic priorities.

Written by: India.com Business Desk Edited by: Manmath Nayak

Updated: February 1, 2022, 9:01 PM IST

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https://www.india.com/business/budget-2022-how-fm-sitharamans-announcements-will-impact-indias-middle-class-explained-economy-job-employment-affordable-housing-income-tax-5218313/ Copy

Budget 2023 Latest Update

Budget 2022: During the Budget 2022 presentation, Union Finance Minister Nirmala Sitharaman announced a host of measures for a number of sectors, aimed at boosting growth amid rising inflation and continuing Covid uncertainties. However, she made remarkably no big changes to the personal income tax structure in a year that had seen demands from various quarters for some sort of relief at this time of pandemic.

FM Sitharaman on Tuesday said the Budget 2022 lays down the foundation to steer the economic developments for the next 25 years with holistic and future priorities. Giving details, she said the Central government will step up spending to Rs 39.45 trillion or USD 529.7 billion in the coming fiscal year to build public infrastructure and drive economic growth.

Soon after the Budget presentation, PM Modi called it “people-friendly and progressive” budget, and added that it has brought new confidence to usher development in the midst of Covid pandemic. PM Modi also said this budget will create many new opportunities for the common people, besides strengthening the economy.

Here is how Sitharaman’s announcements will impact middle class people:

Income Tax: Belying expectations, FM Sitharaman did not tinker with the personal income tax rates in the Budget for 2022-23. She also did not raise standard deduction, which was widely anticipated in view of elevated inflation levels and impact of the pandemic on the middle class. The standard deduction currently stands at Rs 50,000.

Moreover, there was no change income tax slabs in the personal income tax category in the Budget unveiled on Tuesday. The corporate tax rate too was kept at the same level. However, concessional rate of 15 per cent has been extended by one year for newly incorporated manufacturing units.

“To provide an opportunity to correct such errors, I am proposing a new provision permitting taxpayers to file an Updated Return on payment of additional tax. This updated return can be filed within two years from the end of the relevant assessment year,” FM Sitharaman said.

List of things to get cheaper

• Gem stones and diamonds
• Clothes
• Mobile phone chargers
• Camera lens for cellular mobile phones
• Frozen squids
• Frozen mussels
• Cocoa beans
• Asafoetida
• Acetic acid
• Methyl alcohol
• Steel scrap
• Chemicals needed for petroleum products

List of things to get costlier

• Imitation Jewellery
• Single or multiple loudspeakers
• Umbrella
• Headphones and earphones
• Smart meters
• Solar modules
• Solar cells
• X-ray machines
• Parts of electronic toys.

Here’s a sector-wise measures announced in Budget 2022:

Economy

• Capex target expanded by 35.4 per cent — from Rs 5.54 lakh crore to Rs 7.50 lakh crore. FY23 effective capex seen at Rs 10.7 lakh crore
• ECLGS cover expanded by Rs 50,000 to Rs 5 lakh crore
• Top focus of the budget this year are: PM Gati Shakti, Inclusive Development, Productivity Enhancement, Sunrise Opportunities, Energy Transition, Climate Action, Financing of investments

Duties on Industry

• Import duty on certain chemicals to be reduced.
• Customs duty exemption on steel scrap will be extended for another year for MSMEs
• Beginning October 2022, unblended fuel to get additional duty of Rs 2/litre

Jobs

• She said the digital ecosystem for skilling and livelihood will be launched.
• API based skill credentials, payment layers to find relevant jobs and opportunities

Affordable housing

• She said Rs 48, 000 crore is allotted for PM Awas Yojana.
• As per the announcement, in 2022-23, over 80 lakh houses will be completed for identified beneficiaries of PM Awas Yojana.
• Over 60,000 houses will be identified as beneficiaries for PM Awas Yojana in rural and urban areas
• Rs 60,000 crore allocated for providing access to tap water to 3.8 crore households.