Financial Current Affairs of 2022

Categories: Experienced Freshers Current Affairs 2022

 Union budget 2022 is being presented by Financial Minister Nirmala Sitharaman

Union Finance Minister, Nirmala Sitharaman is presenting the Union Budget 2022.

She will be presenting the financial statements and tax proposals for the fiscal year 2022-23 (April 2022 to March 2023). A Made in India tablet has replaced the traditional ‘Bahi Khata’ as Union Finance Minister Nirmala Sitharaman leaves the Finance Ministry’s office to go to the Parliament to present the Budget.

Budget and Constitutional Provisions

• The Union Budget is the yearly financial report estimating the income and expenditure presented to outline future policies to be adopted by the government for sustainable growth and development.
• According to Article 112 of the Indian Constitution, the Union Budget of a year is referred to as the Annual Financial Statement (AFS). 
• It is a statement of the estimated receipts and expenditure of the Government in a Financial Year (which begins on 1st April of the current year and ends on 31st March of the following year).

Here are the key highlights from the Union Budget 2022-23:

• Finance Minister Nirmala Sitharaman, while presenting the Budget, said that the country is expected to grow at 9.27 per cent.
• Two parallel tracks for the next 25 years: public investments in infrastructure and a budget that is inclusive and futuristic.
• 7 focus areas: PM Gati Shakti, Inclusive Development, Productivity Enhancement, Sunrise Opportunities, Energy Transition, Climate Action and Financing of investments.
• This Union Budget seeks to lay the foundation & give a blueprint of the economy over ‘Amrit Kal’ of next 25 years – from India at 75 to India at 100.
• Production Linked Incentive schemes in 14 sectors with the potential to create 60 lakh new jobs, and the additional new production of Rs 30 lakh crore.
• Startups will be promoted to facilitate Drone Shakti to make drone a service. In select ITIs in all states, courses will be started.
• Emergency Credit Line Guarantee Scheme to be extended up to March 2023, guaranteed cover extended by another Rs 50,000 crore. The total cover under the scheme is now Rs 5 lakh crore. An additional amount has been earmarked for the hospitality sector.
• Announcement of Ken Betwa river linking project worth Rs 44,605 crore to be beneficial for capital goods players.
• Govt continuously encouraging digital banking. Taking forward, 75 digital banking units will be set up in 75 districts.
• PM Modi’s development initiatives for the North East will be implemented by the North Eastern Council. This will enable livelihood activities for the youth and women. This scheme is not a substitute for the existing Centre or state schemes.
• Issuance of e-passports will be rolled out in 2022-23 to make it easier for citizens. Ease of business 2.0 will be launched.
• 5G spectrum auctions to be carried out in calendar 2022 to enable the launch of services within FY22-23.
• Animation, visual effects, gaming and comics sector offers immense potential to employ youth. An AVGC promotion task force with all stakeholders will be set up to recommend ways to realise this and build domestic capacity for serving our markets and the global demand.
• Special Economic Zones Act will be replaced with new legislation for the development of enterprises and hubs. It will cover the existing industrial enclaves and enhance the competitiveness of exports.
• Effective capital expenditure of the Central government is estimated at Rs 10.68 lakh crore in 2022-23, about 4.1% of GDP.
• To facilitate domestic manufacturing of 280 gigawatts of installed solar capacity by 2030, an additional allocation of Rs 19,500 crore for PLI for manufacturing of high-efficiency modules with priority to fully integrate manufacturing units to solar PV modules will be made.

Tax Proposals:

• Nirmala Sitharaman announced a new tax rule for taxpayers where a taxpayer can file an updated return on payment of taxes within two years from the end of the relevant assessment year.
• Both Centre and States govt employees’ tax deduction limit to be increased from 10% to 14% to help the social security benefits of state government employees and bring them at par with the Central govt employees.
• Income from transfer of digital assets (Cryptocurrency) to be charged 30% tax, plus 1% tax on the transaction.
• Existing tax benefits for startups, which were offered redemption of taxes for 3 consecutive years, to be extended by 1 more year.
• Income from Long Term Capital Gains will be taxed at 15%, the Finance Minister said.
• The gross GST collections for the month of January 2022 are Rs 1,40,986 crore —the highest since the inception of the tax.
• Duty concessions are being given to promote electronics manufacturing, wearables and hearables devices included. Duty concessions to [parts of mobile phones including camera modules etc.
• Customs on polished diamonds, gemstones cut to 5%. Simply sawn diamonds will be exempted. To facilitate the export of jewellery through e-commerce, simplified regulations will be in place by June this year.
• Deduction for employer contribution to NPS increased to 14% from 10% earlier for State govt employees on par with central govt employees.
• No set off permitted against other income.

Deficit/Expenditure:

• Proposes fiscal deficit of 4.5% of GDP by 2025/26
• Projects fiscal deficit of 6.4% of GDP in 2022/23
• Revised fiscal deficit for 2021/22 at 6.9% of GDP
• Total expenditure in 2022/23 seen at 39.45 trillion rupees

Financial inclusion:

• 100% of 1.5 lakh post offices will come on the core banking system, enabling financial inclusion and access to accounts through net banking, mobile banking, ATMs, and also providing online transfer of funds between post office accounts and bank accounts.
• This will be helpful especially for farmers and senior citizens in rural areas, enabling interoperability, and financial inclusion.

Fiscal Deficit target set at 6.4% for FY23:

• FY23 total expenditure seen at Rs 39.45 lakh crore.
• Total Receipts other than borrowing seen at Rs 22.84 lakh crore.
• Revised Fiscal Deficit 6.9% of GDP in FY22 as against 6.8% in Budget estimates.

National Telehealth programme:

Indian Railways:

• PM Gati Shakti plans one of the four pillars of growth. 25,000 km of national highways to be built in 2022-23.
• 400 new-generation Vande Bharat trains with higher efficiency and better facilities for passengers will be developed in the next three years. Over 2,000 km of the rail network to be brought under the indigenous world-class technology KAWACH, for safety and capacity augmentation.