Budget 2022 Highlights: Key Takeaways for Investors

On Tuesday, Union Finance Minister Nirmala Sitharaman presented the Union Budget for the financial year 2022-23.

Let us look at some of the important announcements made by the finance minister in the budget with special emphasis on updates for investors.

Cryptocurrency and Digital Rupee

• The government intends to develop a digital rupee based on blockchain and other technologies in the fiscal year 2022-23. It will be issued by the Reserve Bank of India.
• Profits from digital assets will be taxed at the highest rate of 30%.
• Only the acquisition cost would be considered while computing the income from digital assets.
• The losses from digital assets can’t be set off.
• TDS of 1% will be deducted on transferring digital assets.
• The individual who receives the digital assets as a gift will also have to pay taxes.

Increase in the tax benefit for state government contribution in the NPS

• For state government employees, the tax deduction against employer contributions in NPS will be increased to 14% from the current 10%.

Possibility of correcting a tax mistake

• Taxpayers have two years to file an updated return within two years of the relevant assessment year if they fail to disclose income when completing their first forms.

Other important updates:

Here are some of the other essential announcements mentioned in the budget that may boost the companies associated with these sectors. 

Infrastructure sector

The government wants to expand highways across the country by 25,000 kilometres and spend more money on the Nal se Jal scheme, five river link projects in different states, and more money for the PM housing scheme.

 The government would develop the PM Gati Shakti master plan for expressways in 2022-23 to promote the speedier movement of people and products. In 2022-23, the national highway network will be increased by 25,000 kilometres. Besides public investment, Rs 20,000 crore will be allocated through other sources.

Drone industry

The announcement of Drone Shakti by the Union government is a major boost to the drone sector. Drone Shakti and the Rs. 120 crore PLI scheme for drones and drone components will assist boost domestic manufacturing and job creation. According to the government, start-ups would be encouraged to help with 'Drone Shakti' through various use cases and applications.

Blended petrol

According to the budget, unblended petrol will be subject to an additional differential excise fee of Rs.2/ litre from October 1, 2022. The finance minister has announced this move to lower the percentage of unblended petrol in the country and reduce dangerous particle emissions.

MSME & Travel Industry

In her Budget 2022 speech, Union Finance Minister Nirmala Sitharaman announced the continuation of the Emergency Credit Line Guarantee Scheme (ECLGS) until March 2023.

The government will set aside a separate corpus for hospitality and allied industries, and the government will take initiatives to strengthen the MSME (Micro, Small and Medium Enterprises) sector.

The finance minister stated that the scheme's coverage would increase from Rs.50,000 crores to Rs.5 lakh crores.

5G

The Indian government plans to hold a spectrum auction by the end of the year to help private telecom companies put out 5G services.

As part of the production-linked incentive plan, a design-led manufacturing scheme will be developed to help build a robust ecosystem for 5G.

Form expert panel for PE/VC investments 

The government is going to set up an expert panel to help people invest in venture capital and private equity. The government, through this panel, will look at more policies that could help investors who put money into Indian businesses from outside the country.

Conclusion

While the budget didn’t have any significant updates for mutual fund investors, it made major announcements for the crypto industry. This article has summarised some of the major pointers announced in the budget.