Budget looks to promote growth and employment generation
05 July 2019
Union Budget 2019-20 presented today by union minister of finance and corporate affairs Nirmala Sitharaman, lays down a vision for India becoming a $5 trillion economy by 2024-25.
Investment-driven growth and employment generation form the cornerstone of this vision. For this, the scope of investment-linked tax deduction has also been broadened by including certain new sectors, including infrastructure, which are critical to growth.
Investment allowance and higher additional depreciation has been proposed to be provided for undertakings in backward regions of states of Andhra Pradesh, Bihar, Telangana and West Bengal.
Incentive for employment generation has also been broadened and the conditions for eligibility to claim the incentive were relaxed.
It proposes to allow computation of MAT liability and carry forward of loss for companies under Insolvency and Bankruptcy code (IBC).
Safe Harbour provisions were further liberalised to align with industry standards.
Scope of domestic transfer pricing provisions was earlier restricted only for transactions between enterprises having profit-linked deductions.
Pass through status was provided to Category I & II Alternative Investment Funds (AIFs).
The time period for carry forward of MAT credit was increased from 10 to 15 years.
These initiatives are proposed as part of a framework for kick-starting the virtuous cycle of domestic and foreign investments. “We need to invest heavily in infrastructure, in digital economy and on job creation in small and medium firms”, the finance minister stated. The common man’s life changed through MUDRA loans to help him do his business.
Government has announced its intention to invest Rs100 lakh crore in infrastructure over the next five years, the finance minister stated. The massive push given to all forms of physical connectivity through Pradhan Mantri Gram Sadak Yojana, industrial corridors, dedicated freight corridors, Bhartamala and Sagarmala projects, Jal Marg Vikas and UDAN Schemes is expected to give the required boost to the economy.