Budget 2023 De-Coded

Hello Investors,

Greetings from the InveStellar ….

Yesterday, I read one meme on Budget:

A: what is your expectation from the Budget?

• B: iss bar to samaj main aa jaye bus….

Jokes apart, many of our friends feel 

 the budget as complicated as coding so for all of us it’s a

‘De-Coding of Budget’ in simple words….

We will go step by step:

 

·         What is Budget?

For household level, it’s a planning of income and expenditure. It is a logical forecast of anticipated sources of income as well as expenditure at that certain period.

In the same way, a government budget is a document prepared by the government and or other political entity presenting its anticipated tax revenues and proposed spending or expenditure for the coming financial year. (For the fiscal year that runs from 1st April to 31st March.)

·         Why it is required?

Simply, to do the planning according to the budget so, we will have now an idea about how much amount we will have and how much amount we need to spend and how much residual amount will be there for saving, investment or for other productive use which is different than our routine spending.

 In a same way government also plans a budget to anticipate expenditure, revenues as well as to revise various components such as tax slabs, sector specific aid along with new initiatives towards the country’s enhancement.

·    Now we will see snippets of recent Budget 2023

·    The budget has given focus on key 7 segments which are ‘Saptarshi’ of Modi Government Budget 2023.

Ø  Infrastructure growth

Ø  Green Energy

Ø  Inclusive development with digital libraries

Ø  Focus on Governance

Ø  Youth Power with encouragement to MSME and Entrepreneurship

Ø  Financial Empowerment

Ø  Agriculture  development with digital Infra

 

·         Now, we will see key points of Budget 2023

Ø  It has induced a boost to Agri-sector as well as startups.

Ø  Special schemes for fishery sector.

Ø  Ministry for cooperative development formed

Ø  Major boost for opening medical colleges

Ø  National Database for mapping cooperatives

Ø  National Digital Library to enhance Youth development.

Ø  Capex outlay increased by 33% to 10 lakh Crores

Ø  50-year interest free loans for states to continue for one more year

Ø  Rs.2.40 lakhs crores  budget for Railways with different schemes

Ø  Around 100 critical infra projects pointed

Ø  for urban infra work, a budget of Rs. 10000 crores.

Ø  3 centres of excellence to be set up for artificial intelligence.

Ø  PAN  card to be used as a common identifier on government websites through an online mandate.

Ø  Approximate allocated amount of Rs. 7000 crores for Phase 3 of E-Courts

Ø  Around 100 labs for 5G services

Ø  Refund Schemes in case of failure of MSMEs by government agencies

 

 

·         What will the net effect on our day-to-day life …

 

Ø  On account of Green Power drive, carbon emission will be reduced which will be resulted into healthy atmosphere around.

Ø  Due to Youth Power Initiative, focus on Skilling and Job Creation will be given, it will also boost tourism sector through various schemes such as Dekho Apna Desh Scheme.

Additionally, Stipend Support to 47 lakhs Youth will be provided along with focus on New Age Skills like Robotics, Artificial Intelligence & IOT segments.

 

Ø  Financial Empowerment will be boosted through various schemes Credit Guarantee scheme for MSME, Mahila samman bachat scheme for women with 7.5% interest, SEBI regulations  and enforcement awarding of diplomas ,amendments in  Banking Laws and more.

 

Ø  On account of Indirect Tax  segment, Tax exemption on Capital Goods and lithium Batteries for Electric vehicles will be there so the related goods will be more affordable to common people now. Moreover, moves like  GST Exemption on Blended CNG the related segment will be boosted.

 

Ø  Custom duties will be reduced, Silver, diamond  and gold will be more expensive along with cloths.

 

Ø  Toys, cigarettes, imported cars , Imitation jewellery, electrical kitchen chimneys  and Bicycles will be costlier.

 

Ø  In tax section, People with an income up to Rs 7 lakh do not have to pay any tax.

 

Ø  Highest tax rate which the wealthiest class will pay , got  reduced to 39% from 42. 74% .

 

Ø  Railways segment will be boosted and thereby  fundamentally strong railway related companies too.

 

Ø  Aero planes and other aircrafts will be cheaper along with parts of mobile phones and parts of TV panels.

 

·    In old tax regime there will  be no changes.

·      

                                          

New tax slabs will be as follows:

  

( Source for image : Internet)

 

 Analysis Written By :

RA Madhura Prathamesh Karekar

( SEBI Registered Research Analyst)

Founder : InveStellar Equity Research and Consulting