Impact of Budget on Common Man

Finance Minister Nirmala Sitharaman unveiled the Union Budget 2024-25 on Tuesday, outlining nine priority areas including agriculture, employment and skilling, manufacturing and services, human resource development, urban development, energy security, and more. This year's budget prioritised job creation and increased rural expenditures.

Sitharaman unveiled Prime Minister Narendra Modi's package of five projects for employment, skilling, and other possibilities for 4.1 crore youngsters, with a total cost of Rs 2 lakh crore. The government has earmarked Rs 1.48 lakh crore for education, employment, and skill development.

A budget of Rs 2.66 lakh crore has been set out for rural development, which includes rural infrastructure. Sitharaman also highlighted steps to simplify taxes, enhance taxpayer services, and give tax certainty, including a new tax system that increased the standard deduction for salaried employees from Rs 50,000 to Rs 75,000. Let's have a look at how this affects everyday people and customers.

Education and Employment

The government focused primarily on four 'castes': the impoverished, women, young, and farmers. In terms of job creation, Sitharaman launched a policy that will pay a one-month wage to all newcomers entering the labour in all official industries. The direct benefit transfer of one month's pay in three instalments to first-time workers, as registered with the EPFO, will be up to Rs 15,000.

A policy to give incentives to employees and employers for their EPFO contributions during the first four years of employment was also unveiled, and it is estimated to assist 30 lakh young people entering the workforce. The government would also compensate companies up to Rs 3,000 per month for two years for each extra employee's EPFO contribution. 

The Centre also unveiled a comprehensive strategy to give internship opportunities in 500 leading firms to 1 crore kids over five years, exposing interns to a 12-month real-life business environment, diverse vocations, and job chances. The internship allowance would be Rs 5,000 per month, plus a one-time aid of Rs 6,000.

The government has offered to provide financial assistance for loans of up to Rs 10 lakh for higher education at domestic institutions. Furthermore, the government would issue e-vouchers directly to 1 lakh students each year, with an interest subsidy of 3% of the loan amount. Up to 1,000 ITIs would be updated in a hub-and-spoke manner, and the government will alter the manner Skill Loan plan to allow loans of up to Rs 7.5 lakh. Furthermore, the FM has launched a new government funded skill development initiative in conjunction with states and industry, with the goal of training 20 lakh youth over the next five years.
 

Housing and Other Amenities

The Union Finance Minister announced the construction of three crore new dwellings in rural and urban regions under the Pradhan Mantri Awas Yojana. True to its word on women-centric development, she announced an allocation of more than Rs 3 lakh crore for projects benefiting women and girls.

The government will also begin the Pradhan Mantri Janjatiya Unnat Gram Abhiyan, with saturation coverage in tribal-majority villages and aspirational districts. This stage would reach 63,000 villages, benefiting 5 crore indigenous people. The government has developed a plan called 'Purvodaya' for the overall development of eastern India, which includes Bihar, Jharkhand, West Bengal, Odisha, and Andhra Pradesh.

The most significant event is the provision of Rs 2.66 lakh crore for rural development, as well as the launch of new projects in Bihar and Andhra Pradesh, which are run by strong allies of the Centre. The government also gave farmers a significant boost by giving Rs 1.52 lakh crore to the agricultural and associated industries. It claimed that one crore farmers would be inducted into natural farming within the following 

"Under PM Awas Yojana Urban 2.0, the housing needs of one crore urban poor and middle-class families will be addressed with an investment of Rs 10 lakh crore. This will include the central assistance of Rs 2.2 lakh crore in the next five years. A provision of interest subsidy to facilitate loans at affordable rates is also envisaged," Nirmala Sitharaman said during the budget presentation.

Land Reforms and Infrastructure

The government launched the fourth phase of the Pradhan Mantri Gramme Sadak Yojana (PMGSY), which would give all-weather connection to 25,000 rural habitations that have become eligible due to population growth. It has set aside Rs 1.5 lakh crore for long-term, interest-free loans.

Furthermore, governments would be incentivised to implement land-related reforms and activities during the following three years with adequate economic assistance. These changes will address administration and planning in rural regions, as well as urban planning, usage, and construction codes in cities.

Sitharaman stated that rural land-related actions will include the use of ULPIN or Bhu-Aadhaar for all lands, the digitisation of cadastral maps, the survey of map subdivisions based on current ownership, the establishment of a land registry, and linking to the farmers' registry to facilitate credit flow and agricultural services.
 

Taxes Impact on Consumers

In a significant benefit to consumers, the government lowered customs charges on gold and silver to 6% and platinum to 6.4%. Customs taxes on cancer drugs, X-rays, mobile phones, and mobile phone chargers have all been slashed. The administration has also exempted solar cells and panels from customs taxes. Leather and textile clothes, footwear, and other leather items would become more affordable. However, plastic items and telecom equipment will grow more expensive.

Sitharaman announced a full study of the Income Tax Act of 1961. In a significant step, the government boosted the standard deduction for paid personnel from Rs 50,000 to Rs 75,000, while pensioners' deductions were doubled from Rs 15,000 to Rs 25,000. This reform was widely expected, and it would enable salaried employees to save an additional Rs 17,500 in income tax.

The standard deduction would be raised from Rs 50,000 to Rs 75,000 for individuals who choose the new tax regime.
 

Delays in submitting TDS will also be decriminalised. Sitharaman stated that all main taxpayer services under GST, as well as the majority of Customs and Income Tax services, have been digitised. The Vivad Se Vishwas Scheme, 2024, has been launched to resolve various income tax problems that are now under appeal.