Union Budget 2021 Latest Updates: With the Central government holding pre-budget concultations with a number of stakeholders, it is expected that the Union Ministry of Finance will introduce ‘Covid-19 cess’ this time. However, a final decision on the ‘Covid-19 cess’ is expected to be taken near to the budget announcement date. Union Finance Minister Nirmala Sitharaman is likely to announce the budget for the upcoming fiscal year on February 1, 2021. Also Read - Budget 2021: Tax Slabs May Remain Unchanged But Salaried Taxpayers Likely to Get Some Relief This Year
At this time of coronavirus pandemic, now all eyes are on the Centre’s upcoming budget announcement for 2021-22 as India looks to get back into growth trajectory after a devastating economic blow due to the COVID situation. Also Read - Nirmala Sitharaman Hosts Halwa Ceremony Ahead of Budget 2021 | Here's All You Need to Know
The tough economic situation has left the Centre with little choice but to spend more — a task that seems difficult due to lower revenue collection and higher expenditure during most parts of 2020. Moreover, the cost of vaccination drive against Covid-19 will further increase the government’s expenditure this year. Also Read - Railway Budget 2021: Will Centre Focus on New Bullet Trains in Coming Years? Details Here
Keeping all this mind, the Centre is holding discussions on a plan to introduce a coronavirus cess or surcharge, reported The Economic Times newspaper. Though the talks are in the preliminary stage, the plan is to introduce a Covid-19 cess or surcharge for India’s high-income earners.
What is Covid cess?
The Centre is discuss the COVIS cess with a number of stakeholders. The preliminary talks revolved around introducing a small cess on taxpayers who fall under the high-income bracket alongside some additional indirect taxes.
Apart from this, the Centre is also planning to introduce additional excise cess on petroleum and diesel on top of existing customs duties. However, the government has not yet made any such indication.
Earlier, Niti Aayog member Dr Vinod Paul had confirmed that the Centre will cover vaccination costs for at least 30 crore people. The government has confirmed that the first nationwide vaccination drive will start on January 16. Also, the Centre will spend a big chunk towards distribution, training and logistics. As the government will have to face these extra expenses, a Covid-19 cess for high-income individuals may become a possibility.