Tax exemption for income up to Rs 5 lakh, says FM

Tax exemption for income up to Rs 5 lakh, says FM

Battling agrarian crisis and massive farmer anger, Modi government on Friday sprinkled goodies on almost all sectors with emphasis on middle calls and small and marginal farmers announcing biggest IT relief in decades exempting income up to Rs 5 lakh annually and promising a direct benefit transfer of Rs 6,000 in every farmer’s account in a year.

The farmer move will cost the government Rs 75000 crore in a year.

The IT exemption this is year double of the last year when annual income up to RS 2.5 lakh was exempted from taxes.  

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Goyal’s budget had the contours of a social budget intermixed with an aspirational edge in an election year as he announced doles for farmers, labours in unorganized sector and women, considered a caste-neutral vote base which Modi has aggressively wooed in all communities through measures from Ujjawla to better their kitchen work to taking a stand on triple talaq to uplift the social status of Muslim women in marital life.

Meeting the anticipation,  Finance Minister Piyush Goyal announced “PM Kisan Yojna under which the money will be transferred into the farmers’ bank accounts directly three times in a year as installments of Rs 2000 each.

Those chosen for the benefit are farmers with landholding of 2 acres.

Goyal also allocated Rs 75,000 crore in the Budget for 2019-20.  Trying to woo a vast majority of the unorganised workforce, the government also announced a pension of Rs 3,000 to unorganized workers.

Goyal said workers in the unorganised sector earning up to Rs 15,000 a month shall receive a monthly pension of up to Rs 3,000 after the age of 60. A worker at the age of 18 will have to contribute Rs 55 a month, while those above 29 years will have to contribute Rs 100 every month. The government would match the contribution.

He allocated Rs 500 crore for pension plan. The pension scheme will be called Pradhan Mantri Shram Yogi Mandhan, Goyal said amid thumping of desk and murmurs also from the prime minister.

“50% of GDP comes from the sweat and toil of 42 crore workers in the unorganised sector,” said Goyal.

On jobs front, however, Goyal did not promise much.

The Union Budget’s focus on farmers come in the backdrop of farmer agitations having singed its poll prospects in Madhya Pradesh,  Rajasthan and Chhattisgarh, where Congress promised a farm loan waiver for small farmers. This also comes when BJP is bracing for a tough Lok Sabha polls.

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