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Union Budget 2023 Key Highlights- Changes Announced by the Finance Minister

Union Budget 2023 Key Highlights- Changes Announced by the Finance Minister

The 2023 parliament budget session is here. With the looming concerns of global economic slowdown, massive layoffs, and growing inflation, expectations for a better fiscal year were already pouring in. 

Now, all eyes are set on union finance minister Nirmala Sitharaman’s fifth budget speech. The budget for 2023 kept its focus on infrastructure, green growth, higher capital expenditure, and some relief to the middle class. Naturally, from real estate and banking to retail and automobile, every sector is eager to know what the budget has in store for them.

Here are key budget 2023 highlights and the changes announced by the government. 

1. Real estate

The union budget for 2023 was expected to sustain the growth and momentum of real estate. To keep this growth on track, the real-estate sector expects a rise in tax deduction limits and more tax breaks for the buyer. Further, the government might also give a Rs.40,000 crore boost to the Pradhan Mantri Awas Yojna.

The budget did fulfil certain expectations of the real estate sector, as the government proposed a 66% increase in the outlay for Pradhan Mantri Awas Yojna, allocating Rs. 79,000 crores. This move is expected to offer a significant boost to urban housing for the poor. 

2. New income tax regime

2022 has been a financially challenging year for the middle class. The rising inflation, economic slowdown, and massive layoffs have primarily affected the salaried income group. As a result, all hopes were on this year’s budget to bring some relief, and salaried individuals were expecting an increase in tax exemption to Rs. 2.5 lakhs.

True to expectations, union finance minister Nirmala Sitharaman has proposed a new tax regime with the number of income slabs reduced to 5 from the previous six. Under the new tax regime, the tax exemption limit has now been increased to Rs. 3 lakhs, and the income tax rebate limit has been increased from Rs. 5 lakhs to Rs. 7 lakhs.

However, you will still have the option to rely on the old tax regime while filing your taxes.  

3. Saving schemes

The 2023 union budget also included excellent provisions to boost savings schemes among the public. For starters, the maximum deposit limit for the Senior Citizen Savings Schemes will increase from Rs. 15 lakhs to Rs. 30 lakhs. 

In addition, the government will introduce a new one-time saving scheme for women called Mahila Samman Saving Certificate for 2 years up to 2025. 

4. Clean Energy

This year’s budget is big on promoting green growth and clean energy. In line with this, the budget included Rs. 35,000 crores in priority capital for the energy transition. Besides, the government has also proposed an outlay of Rs. 19,700 crores for the National Green Hydrogen mission to reduce the country’s dependence on fossil fuel imports and fast-track the transition to a low carbon intensity economy. 

5. MSMEs

The union budget also brought many positive changes for the MSME sector to promote its long-term growth. The government has revamped the credit guarantee for MSMEs from 1st April 2023, along with the infusion of Rs. 9,000 crores. Additionally, the new credit guarantee scheme for the MSMEs will reduce the cost of credit by 1 percentage point. Thus, promoting the use of credit for business growth by MSMEs. 

In conclusion

The fiscal budget 2023-24 was presented on 1st February 2023. This year, the government policies focused on addressing the key economic challenges, strengthening the financial sector, infrastructural growth, and inclusive development. Amidst the rising hopes for a better fiscal year, if you find yourself looking for an affordable loan this year, check out Tata Capital Moneyfy App or visit the Moneyfy Website!

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