2021 will be the Year of Amendments for the Union Budget: What to Expect

Among the Indian citizens watching Parliament sessions, Union Budget sessions are one of the most-watched by every Indian citizen. The Union Budget 2021 is in the vicinity and everyone is waiting to learn about the new annual policy announcements by the government.Amidst the COVID battle, because of which, people are left with a struggling economy, now, in just a few weeks and from taxpayers to students, everyone hopes to gain something out of the budget.There are reports from experts that this year, the finance ministry will not conduct the Halwa ceremony and there will be no paper involved in the Budget 2021. Only soft copies of the Budget could be circulated among the Parliamentarians. These precautions are going to be implemented due to the Covid-19 pandemic.

What Can Be Expected From The Budget 2021?

Education –

As stated by one of the experts that 40 million students, teachers and all the other stakeholders in the higher education ecosystem require quality access to affordable technology in education.

According to the expert comments, the government should recognize the cost of education and decrease the GST on online education services in Budget 2021. This way, along with the affordable technology, more and more students will be able to avail online education.

There should be a high focus on the development of the education sector, primary education in rural areas.

The expert also said that the education sector is optimistic about the announcement in Budge 2021, majorly when the New Education Policy focuses on the K12 segment. The teachers and students are highly hoping for skilling and STEM-based education in schools and colleges to be given more emphasis. In Budget 2021, the central government also should look after the reduction of 85 percent expenditure to get tax exemption to 75 percent.

Amendment Of Section-47 –

Under the Income – Tax Act’s Section-47, SGB (Sovereign Goal Bonds) transfers by way of redemption shouldn’t be regarded as transfers for capital gain purposes. But, this applies only to the SGB Scheme, 2015, and Section-47 should be amended for removing any particular year’s reference.

There is another expectation that Section-198 should be amended to treat income generated in foreign countries at par with income earned in India, as Section-198 states that the tax deducted at source should be included in one’s gross total income. However, the income computation gets disputed if taxes get withheld outside India and corresponding income is offered to tax in India, while the assessing officer assesses the gross income.

Housing Tax Halts –

For reigniting the pace of the real-estate sector, the government is expected to assess the enhancement of the standard deduction of 30 percent of Net Annual Value to 50 percent and/or enhancement of the present limit of deduction of interest payable on housing loan on self-occupied properties to INR 4 lakh per annum.

Insurance –

A life insurance company’s CEO stated that there should be a separate tax deduction for insurance premiums and more that the 80C limit which is similar to the one allowed for NPS.

Insurance professionals hope that the Government is aiming towards improving life insurance policies and considering these as equipment for policy persistence.

Another insurance company’s CEO and MD stated that the introduction of a separate deduction of 50000 for the first-time insurance buyers and an additional capping of 50000 for someone purchasing the pure protection (term) plan will help life insurance align with the industry development pace.

Experts also suggest that the government should have a relook at the 18 percent GST structure.

Healthcare Facilities –

There should be more focus given on the establishment of centrally funded hospital cum medical college in the 739 Indian districts. With this, there will be drastic changes in the healthcare ecosystem of India. It will also ensure cost-effective yet quality healthcare facilities to the Indian citizens.

There should also be a country-wide unified EMR (electronic medical records) system, which should contain disease registrations and healthcare worker databases for optimized resource allocation.

There should be an establishment and funding of a National Healthcare Audit Authority (NHAA) which would audit the functioning and quality of the care that the healthcare institutes are delivering in the country using objective KPI’s with minimum quality standards set for the care delivered at every step.

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