Budget 2023 Analysis Highlights: From changes in income tax slabs and capex bazooka to affordable housing boost, Finance Minister Nirmala Sitharaman's fifth straight Budget has something for everyone. This was the last full Budget of the Modi 2.0 government before the 2024 general elections. While some may argue that the Budget 2023 was populist, FM Sitharaman stuck to the path of fiscal prudence. Here's a detailed analysis of Union Budget 2023.
Budget 2023 analysis: Budget had no surprises, but took dramatic bet on Capex
The Union Budget 2023 did not have any “surprises”, but took a dramatic bet on capex, while continuing the path of fiscal consolidation, said NITI Aayog vice chairman Suman Bery.
Budget 2023 Analysis Live Updates: Sustained focus on infra will push steel demand
Capex increased for infrastructure development to Rs 10 lakh crore in 2023 Budget along with capital outlay of Rs 2 lakh crore for modernising, expanding Railways.
Infrastructure, building and construction sectors together account for nearly 60 percent of end-use steel consumption share in domestic market. So, sustained focus on infra projects will ensure sustained long-term growth in steel demand too, said CareEdge Ratings. It will help both alloy and non-alloy steel producers.
Further, exempting ferrous scrap from basic customs duty and on raw materials for manufacturing CRGO steel will also augment availability of raw materials to the steel sector and save their cost of production.
Expansion in railway network will result in increased steel usage.
Budget 2023 Analysis Live Updates: ‘Budget has strong sense of fiscal discipline’
Noted industrialist Anand Mahindra says: “…I was gratified to see the higher capex. That’s all about investing for higher growth.”
Adds: “This Budget has lived up to India’s conservative tradition of financial discipline…. finance ministry has embedded in it a strong sense of fiscal discipline and an aversion to profligacy and bankruptcy.”
Budget 2023 analysis: Duty hike on cigarettes to have nominal impact on prices
-- The 16 percent duty hike on cigarettes would increase prices of cigarette sticks by around 7–12 paise per stick
-- The upward revision in the National Calamity Contingent Duty would hardly have any impact on smokers or companies selling cigarettes, say experts.
Budget 2023 Analysis Live Updates: Big tax changes for middle-class
-- Salaried class with income up to Rs 7 lakhs under new tax regime (NTR) exempted through tax rebate from erstwhile threshold of Rs 5 lakhs, leading to tax saving of Rs 33,800.
-- Basic exemption limit increased from Rs 2.50 lakh to Rs 3 lakh.
-- Proposed change in tax slab rate and standard deduction under NTR would lead to tax saving of Rs 54,600 for salaried persons having income of Rs 15.5 lakh.
-- Tax exemption limit on leave encashment for non-government employees increased from Rs 3 lakh to Rs 5 lakh
Budget 2023 Analysis Live Updates: Tax tweak in life insurance to dent topline
-- Budget 2023 tweaks tax exemption on life insurance policies.
-- Tweaks are likely to have a bigger impact on thetopline products compared to the bottomline products, if nothing is done to mitigate the change, HDFC Life CMD said.
Budget 2023 Analysis Live Updates: Learning losses during COVID-19 not compensated
Allocations for school education were reduced during the coronavirus pandemic. The increase in allocation for education in Budget 2023 does not help deal with the damage caused to learning during COVID-19, says expert
Budget 2023 analysis: Union Budget 2023-24 has meagre provisions for marginalised
-- Only one percent rise in allocation for the sector; disabled community continues to be neglected, said National Platform for the Rights of the Disabled (NPRD).
-- Allocations for the scheme for implementation of the (Rights of) Persons with Disabilities Act reduced by Rs 90 crores to Rs 150 crore.
-- Government removed income criteria in PM-JAY for persons with disabilities.
-- Allocations for Indira Gandhi National Disability Pension Scheme not increased.
Budget 2023 Analysis Live Updates: Growth-oriented provisions in Union Budget 2023
Some pro-development provisions in Union Budget 2023-24:
-- Sustainable planning and energy transition
-- Inclusive growth through a tech-enabled economy
-- Impetus to the EV sector
-- Exempting Lithium-ion cells from paying custom duty
-- Viability gap funding to support Battery Energy Storage Systems
Budget 2023 Analysis Live Updates: TDS on listed bonds may hit investor returns
-- With clause (ix) under section 193 of the Income Tax Act being removed, a 10 percent tax may be levied on all listed and unlisted bonds.
-- So, bondholders will now have to pay TDS on their returns, thereby reducing their returns.
-- “The returns of investors will decrease because of TDS applicable now on all interest on securities be it listed or unlisted,” said Umesh Kumar Tulsyan, Managing Director, Sovereign Global.
Budget 2023 Analysis Live Updates: Budget underscores role of digital, tech in development: Nasscom
-- According to IT industry body Nasscom Said the Union Budget 2023 underscored India's plan to become an engine for global growth and deploy digital as leading India's development.
-- However, Nasscom also said that the Budget 2023 touched upon “all the critical aspects required to position India as a leader in terms of digital offerings, along with a focus on talent and sustainability”.
Budget 2023 Analysis Live Updates: ‘Demand-creating provisions will boost auto sales’
-- The auto industry's growth is "very highly correlated" with the overall economy, said Maruti Suzuki India Senior Executive Officer, Marketing & Sales, Shashank Srivastava.
-- Hence, he said, the "growth-oriented" Budget 2023 will help in demand creation.
Budget 2023 Analysis Live Updates: Sops for marine products will help seafood industry
-- The sub-scheme of the PM Matsya Sampada Yojana will support the activities of fishermen, fish vendors, and micro and small enterprises, improve value-chain efficiencies, and expand the market.
-- The duty reduction for key inputs for shrimp feed will also help the seafood industry as marine product exports are facing headwinds in foreign markets because of recession and other problems
Budget 2023 analysis: Why is 2023 Union Budget for senior citizens, salaried class
-- Salaried class wanted rebate and relaxation in income-tax slabs, which was incorporated in Union Budget 2023. FM Sitharaman has proposed raising the rebate limit, reducing number of tax slabs, and increasing standard deduction limit.
-- For the benefit of senior citizens, the Finance Minister has proposed doubling the deposit limit of the Senior Citizen Savings Scheme from Rs 15 lakh to Rs 30 lakh for individual accounts, and Rs 60 lakh for joint accounts.
Budget 2023 analysis:
- From an individual’s perspective, the money saved, if invested, can have a multiplier impact over the following few years and, if spent, will help meet other goals and requirements.
- According to the finance minister’s calculations, the total savings by individuals would amount to Rs 35,000 crore. These additional funds will partly come to the financial system in the form of savings and investments and partly as increased demand for goods and services.
Budget 2023 Analysis Live Updates: Individuals should continue investments even if they opt for new tax regime
There is a lot to cheer for individuals with the prospect of an increase in disposable and investable income on account of enhanced slab limits and reduction in surcharge for individuals in the highest tax bracket. The move is aimed at incentivising taxpayers to shift to the new tax regime, which has not seen much traction since its launch in FY21.
The new tax regime is the default option, but the old regime is still available if preferred. An individual with a total income of up to Rs 7 lakh (Rs 5 lakh earlier) does not need to pay any tax, which is a relief for individuals at the bottom of the taxpayer pyramid. Read more
Budget 2023 Analysis Live Updates: Stepping up capex in Budget will boost logistics, connectivity across country
- The International Road Federation (IRF) has welcomed the increased allocation of Rs 10 lakh crore as capital expenditure in Union Budget, saying it will help boost logistics and connectivity across the nation.
- IRF in a statement also welcomed the thrust of the Budget on seven growth engines of PM GatiShakti, including roads, railways, airports, ports, mass transport, waterways and logistics.
- It said the increased allocation will ensure time-bound creation of world-class transport infrastructure and improve logistics and connectivity across the nation.
Budget 2023 Analysis Live Updates: New tax regime 'sweetened' to benefit maximum number of taxpayers
- The new income tax regime for filing returns has been "sweetened" in the Budget 2023-24 and it will be beneficial for maximum number of taxpayers as they can enjoy a "reduced" tax rate, CBDT Chairman Nitin Gupta said.
- Speaking to PTI during a post-Budget interview, Gupta said the intent of the government while announcing the new slabs and rates under the new tax regime is to gradually "do away with deductions and exemptions" so that the "long-standing demand of reduction of taxes for individual taxpayers and entities can be met."
Budget 2023 Analysis Live Updates: Large outlays for Indian Railways, but not enough
- Ever since the Railway Budget got merged with the country’s General Budget in 2017, Indian Railways have been relegated to the margins of the Finance Minister’s annual Budget speech.
- This year is no exception ― all that the Indian Railways got in the speech was a one-line mention, a capital outlay of Rs 2.40 lakh crore provided to Indian Railways, the highest-ever, at about nine times the FY2014 figure. Read more
Budget 2023 Analysis Live Updates: Will stimulate green growth across sectors in India, says
SumantSinha, chairman and CEO,ReNewPower
- The continued focus on infrastructure expenditure and increasing it by 33 percent to Rs 10 lakh crore and to 3.3 percent of the GDP are also important.
- Taxrationalisationfor the common man is a significant shift. It puts an extra Rs 38,000 crore in the hands of the common man and woman, and therefore, hopefully, encourages more investors and consumption/demand.
Budget 2023 Analysis Live Updates: One tailored for the taxpayers
- The personal income tax announcements are indicative of the government's push towards the tax paying citizen to opt for the new tax regime announced in FY 20-21.
- This regime has now become the default regime and the new slabs are to nudge taxpayers to opt for it. The highest income tax rate has also been reduced to 39 percent (previously 42.74 percent). Read more
Budget 2023 Analysis Live Updates: The focus is on increasing productivity, efficiency through quality spending
- The finance minister has adopted a pragmatic pro-growth approach in Budget 2023-24 in setting the path for India’s transition from being the 5th largest global economy to the 3rd largest by the turn of this decade.
- The budget has been presented in the backdrop of a strong recovery in the Indian economy after being battered by Covid, recessionary headwinds for major global economies in 2023, and a turbulent global geo-political environment. Read more
Budget 2023 Analysis Live Updates: What Morgan Stanley said
- Morgan Stanley in its report called it a 'good' growth Budget that improved the quality of government spending and remained fiscally prudent.
- "In our view, the Budget provides firm support to domestic demand, which is critical in an environment of slowing."
Budget 2023 Analysis Live Updates: What CLSA said
- CLSA hailed the Budget's growth-focussed nature. It said that there weren't any populist measures that many were concerned about due to general elections next year.
- Due to the changes being offered in new income tax regime, it said that many will continue with old regime resulting in no major savings. This will not spur consumption.Read more
Budget 2023: Nirmala Sitharaman hits three targets in one shot
- Finance minister Nirmala Sitharaman has delivered a Bahubali Budget, hitting three targets at a time.
- She has provided Rs 10 lakh crore for capital expenditure in FY24, which is 33 percent higher than last year, and almost four times the allocation in FY16. This will go a long way in sustaining the growth momentum of the economy. Read more
Budget 2023 Analysis Live Updates: Supportive of economic recovery
- From a cyclical viewpoint, we have an economy that is now recovering from external shocks after a gap of three years. In the interim, the economy was under pressure from weak demand and needed both fiscal and monetary support. But as the economy enters the recovery path and private demand gathers pace, reducing fiscal support will be a prudent step.
-Keeping up with the capex spirit, we hope to see a revival in construction and home-building activity. This will be a prominent driver towards creating jobs for the large pool of unskilled labour. Read more
Budget 2023 pushes for growth, flags risks to fiscal deficit target, says Nomura
With higher capex pegged at 3.3% of GDP, Nomura said that Budget 2023 pushed for growth but flagged the risk of fiscal deficit slippage owing to a higher than budgeted revenue expenditure and slower tax collections.
In its report analysing the Union Budget, Nomura has flagged the challenge of achieveing the fiscal deficit target of 5.9 per cent in FY24 mainly due to the optimistic nominal growth projections. Read more
Budget 2023 Analysis Live Updates: New health priorities on horizon
Confident that India has moved out of COVID’s shadow, the Union Budget has signalled a clear intent to move India into a global leadership position in drug development, digital health and health workforce development. This aligns well with India’s presidency of G-20 this year. Read more
Budget 2023 Analysis Live Updates: MF investors should bet on sectoral, thematic funds
It is easy to mistake a simple Budget for an uneventful one but a deeper understanding of India’s current economic context and the government’s tight-rope walk would help one conclude that the best thing about such a Budget was the delivery of so many without breaking any. Read more
Budget 2023 Analysis Live Updates: Budget provides a great opportunity for investors
As governments worldwide step up borrowings, investors will demand, and get, higher coupon rates. Don’t be surprised if bond yields rise during the course of the coming financial year. Read more
Budget 2023 Analysis Live Updates: Earning Rs 10 lakh per annum? Higher deductions will mean more savings
Salaried individuals with income of Rs 10 lakh will be better off under the old tax regime despite the freshly-sweetened new tax regime in Budget 2023, provided they claim higher tax deductions. Read how
Budget 2023 Analysis Live Updates: Major job creation opportunities ahead
"Job creation is an outcome of capital expenditure and infrastructure spends across various sectors. I feel there is strong scope of major job creation opportunities if the planned projects and outlays are put to work in the right manner," saidAniruddha Sarkar, Chief Investment Officer & Portfolio Manager, Quest Investment Advisors.Read more
Budget 2023 Analysis Live Updates: It won't be unfair to say it's a dream budget
Union Budget 2023-24 can be rightly called a Dream Budget considering the current domestic and macroeconomic scenario. Focus on growth was important to ensure that private capex cyclical recovery continues. The hike in government capex by 33% combined to Rs 10 lakh crore with a Rs. 2.4 lakh crore outlay provided to the railways should give a huge boost to the economy. (Read more)
Budget 2023 Analysis Live Updates: Mahila Samman Saving Certificate Vs Sukanya Samriddhi Yojana
In Budget 2023, FM Sitharaman announced a new small savings scheme for women investors - Mahila Samman Saving Certificate (MSSC).
The scheme allows deposits to be made in the name of a woman or a girl child. Investors can deposit up to Rs 2 lakh for a period of two years at a fixed rate of 7.5 percent with a partial withdrawal facility. However, there are no tax benefits. This scheme is different from Sukanya Samriddhi Yojana. Here's how
Budget 2023 Analysis Live Updates: Changes relevant to the NRIs
In her budget speech, the Finance Minister did not announce any big proposals to upset the Non-Resident Indians (NRIs). However, there have been a few tweaks that could change the way NRIs invest or earn from Indian assets. Here's a detailed analysis.
Budget 2023 Analysis Live Updates: How would the new tax regime affect those earning Rs 50 lakh?
FM Sitharaman has made the new tax regime attractive by reducing the number of tax slabs and peak surcharge rate. The 'default tax regime' now stands to benefit the those in the high tax brackets. Here's an example of someone with a taxable income of Rs 50 lakh per annum. But before we tell you which regime you should choose, let's take a look at some basics first. (Read details here)
Budget 2023 Analysis Live Updates:
Earning Rs 15 lakh per annum? Here's how new tax regime may impact you
Even though the FM Nirmala Sitharaman tried to hardsell the the new income tax regime, the choice for taxpayers is not as straightforward. However, a back-of-the-envelope calculation shows that Rs 15 lakh income, coupled with Rs 3.75 lakh deduction, is a break-even point. (Read details here)
Welcome to Money control live blog. Track this space for the detailed analysis of Budget 2023.
