Name: Union Budget 2020 - Full Analysis for UPSC, IAS, CDS, NDA, SSC CGL
Uploaded: 2020-03-19T05:52:31.000Z
Duration: 32 min 53 s
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in this video, we'll look at sector vice highlights of the 2020 union budget.

The 2020 budget has been made by keeping in mind three teams.

The 1st 1 is aspirational India to boost the standard of living The 2nd 1 is economic development for all, and the 3rd 1 is building a human and getting society.

If your current income it's between five black and 7.5 black, the income tax has been reduced to 10% from the current 20%.

Similarly, if your income is between 7.5 black and pen lack, you will be taxed at 15% which was a little 20% and so on and so forth.

The reason behind releasing the income taxes to boost people sports using bar.

The more money you will save from your income, the more you will be able to spend.

And that will increase demand because income and demanded directly related.

Ultimately, that's how economy keeps going and inflation is under control.

Companies will no longer be required to pay a dividend distribution tax.

Now, government has also decided to remove dividend distribution tax on Cos.

Let me quickly tell you what dividend distribution tax is.

It is the tax which is imposed by the Indian government on Indian companies when they pay a dividend to its shareholders.

Whenever the company makes profit, it has to pay some money to its shareholders out of its profit.

So now the government is saying that companies have to no longer pay dividend distribution tax.

If they can save any amount of money by not paying tax, it's a profit for them.

So, of course, it will make India an attractive destination for investment.

However, now the companies don't have to pay the tax, the tax has been shifted to the recipients or the shareholders who received the money as dividend.

Suppose you buy a share of the company and let's say the company made profit.

That means the company's supposed to give you some dividend from its profit.

So earlier, companies used to pay a tax, which is called the dividend distribution tax, to the government before paying the dividend to the shareholders, and now the government has shifted that burden off tax onto the shareholder who receives the dividend as per day tax bracket.

It is similar to how you get taxed on your interest income from bank fixed deposits.

So if you reduce the tax lab on one hand and include the dividend tax on the other, I mean, of course I'm not taking it as a general argument.

Not everyone chooses to invest in shares and mutual funds.

But for the sake of the argument, if you're someone who invest in shares and mutual funds, then tax will believe I don't you salary, dividends and interests.

That means your overall taxable income will go up.

So basically it equalizes now for a company, it is a good thing that they know more have to pay a dividend distribution tax.

That means now they will have more funds.

Whether or not they will pay higher dividends to the shareholders is something that needs to be seen.

Our heart based verification for GSD compliance to be introduced.

The whole purpose behind other based verification for GSD compliance is toe identify all those business units who are trying to game the system.

Now that other card is decentralized, valid document that an individual uses for almost everything.

And we all know to what extent a business owner goes to evade taxation.

Verification will easily identify any frauds related to tax credit and refund.

Economy and Finance Bank deposit insurance cover had been increased from one liketo five black, but depositor.

Now what is bank deposit insurance cover from the term?

You can easily figure out that it is talking about some kind of insurance cover on your bank deposit.

The purpose of insurance is to compensate in case of any failure.

What kind of money do you think will be at risk if you keep it in a bank?

They are called savings fixed and recurring deposits.

The insurance cover on bank deposits has been increased from one lacto five lack per depositor.

That means tomorrow, in case if the bank is in crisis and it's not able to operate.

Then as a depositor, you're eligible for a peace five like insurance cover, which was previously one lack you will only get this money only if the band gets closed.

The deposit insurance scheme covers all banks operating in India, including private sector, cooperative and even branches off foreign banks in India.

The bank deposits are insured by Deposit Insurance and Credit Guarantee Corporation, which is called D I C G C.

It is a subsidiary of the Reserve Bank of India.

All the banks be a nominal premium to this agency for the insurance cover.

The government plans to amend the Companies Act to decriminalize several offenses.

Here they're talking about the Companies Act 2013.

It is the most important piece of legislation that impoverished the central government to regulate the formation, financing, functioning and vining up off the company's.

The act contains the mechanism regarding organizational, financial and managerial aspects off a company.

Now the government wants to amend the companies Act to decriminalize civil offenses.

As for the Companies Act, any violation, which is a criminal offense, can lead to imprisonment for executives if they're found guilty by violation, I mean frauds, money laundering, tax evasion, et cetera.

Basically, they're called a white collar crime.

So the government is saying that if the fraud is not very serious.

Through an amendment, the government wants to put those violation under civil offense and not under criminal offense.

There's a big difference between criminal and civil offense.

A civil offense may attract penalties, but a criminal offense can lead to imprisonment.

As of now, more than 40 instances of violations under the Companies Act are punishable by prison.

You can imagine this may discourage and scared the businesses and investors before starting a business many in the business community seat as a harassment by the government.

And obviously our economy depends on the business community.

So the government is trying to find a balance approach by decriminalizing civil offenses.

The government is planning to sell its stake in L.

So basically what it means is that the government wants to sell its asset, which is in this case, the l.

But right now it is proposing to sell a part of its holding an ally.

See if you see the government currently owns the entire 100% stake in Life Insurance Corporation of India.

Government engages in this investment policy only when they find that the public sector units are showing a negative rate of return on, it is turning out to be a liability to the government than being assets.

However, the government is not saying that they want to sell the life insurance co operation completely, but they're initiating the process.

If you know government has engaged in this investment policies with regards to Air India, Part Petroleum Shipping Corporation and Container Corporation, if you look at Ellis is total nonperforming assets.

It has risen to 6.1% in the 1st 6 months off 2019.

The gross NPS have almost doubled in the last five years.

The government is not saying that they want to sell the L.

C completely, so they're just selling a part off.

It's holding that means by listing a company on stock exchange eight disciplines a company and provides access to financial markets and unlocks its value.

By doing this, the government will be able to own some 8 to 10 lack arose and that will allow the government to meet its highest ever disinvestment target and attract foreign investors.

The government has decided to allocate 2.83 lacquer or for the sector comprising agriculture and allied activities, Not this amount is divided into two portions.

1.6 lacquer for agriculture, irrigation and allied activities and rupees 1.23 lacquer for rural development and punch 80 Dutch.

The aim behind this move is to double the farmer's income by 2022 under agriculture and allied activities, the money will be spent behind the expansion of micro irrigation through Chrissy Century Georgina.

Money will also be allotted in creating storage, financing, processing and marketing solutions in cooperation with the state's investment in chemical fertilizers and energy also comes under this investment, now coming to the investment in rural development and bunch I t Lodge.

This means investment is going to be in providing water facilities, energy, sanitation, education and skills, the government has said.

The agricultural credit availability toe 15 lakh crore for 2022 21 Agricultural credit is required to buy machines like tractors, pressures, harvesters, water pumping sets, etcetera than chemical fertilizers, seeds, et cetera.

The source off agricultural credit can be broadly classified into institutional and non institutional sources.

Non institutional sources include money lenders, traders and commission agents relatives and landlords.

But institutional sources include cooperative's commercial banks, including the SP, A Group R, B, I and Norbert.

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Union Budget 2020 - Full Analysis for UPSC, IAS, CDS, NDA, SSC CGL

boost

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infrastructure