As India's Union Budget 2024 is about get underway in the month of July, let us turn back in time to look at some of the key reforms and policies that were brought in over the years in India's Financial journey.
The Union Budget 2024 for the Financial Year 2025 is not far away. Despite the dates not being finalised, it is expected that the Finance Minister Nirmala Sitharaman would be presenting it on July 23 or 24 tentatively. The Union Budget 2024 is the 93rd Budget in the history of India. Till now, with 77 regular Budgets and 15 interim Budgets.
A key driving force behind the growth of the country since Independence; the Union Budget since its inception in 1947-48, has gone on to play a decisive role in the implementation of policies, reforms, schemes aimed at the radical transformation of the country. Before the arrival of Budget 2024, let us travel back in time to witness some of the things that has happened with respect
The first Union Budget was presented in the year 1947-48 by R.K. Shamukham Chetty, the first Finance Minister of India. The total expenditure stood at Rs 197.29 crore with around Rs 92.74 crore allocated for the defence. In the following year's Budget, R.K Shanmukham used the term “Interim Budget” which came to denote a short-term budget usually the one before the new Lok Sabha elections.
Capital gains tax is a tax paid by the investor upon the selling of the assets, based on the amount by which the asset appreciated during the time it was held.
In the Budget of 1949-50, the government decided to abolish the capital gains tax only to be later reinstated under the budget of 1956-57. This serves as an instrument by which the income tax authorities prevent from tax evasion.
During the Budget of 1985-86, Finance minister V.P. Singh set up the Board for Financial and Industrial Reconstruction (BIFR) which over the years turned into the modern insolvency code. It served as a speedy mechanism to manage and recover loss making and underperforming units in the medium and the large scale sectors.
In the Union Budget of 1993-94, the government announced the setting up of the National Stock Exchange (NSE), which functions as India’s stock markets. The budget that followed in 1994-95, the Finance Minister Manmohan Singh brought in the "Indirect tax" structure in the country, a form of Service tax levying a 5 per cent tax on the telephone, non-life insurance, and stock broking services.
The Union Budget of 1995-96 saw the establishment of the Insurance Regulatory Authority of India (IRDAI). IRDAI, is an autonomous and statutory body responsible for regulating and managing the insurance and industry in India.
The 1997-98 Union Budget is termed as the “Dream Budget". P. Chidambaram, the finance minister brought in several reforms with respect to lowering the income tax rates, the reduction of corporate tax rates, and the removal of the corporate tax surcharges. Apart from that, it also saw the Voluntary Disclosure of Income Scheme (VDIS), under which taxpayers were allowed to disclose any hidden income, by paying a tax on the 30 per cent tax on the total value of the undeclared money.
The Finance minister Yashwant Sinha in the 1998-99 Budget brought in two schemes to attract NRI investments in India. The first one was the Unit Trust of India’s (UTI), India Millenium Scheme and the other was Resurgent India Bonds (RIBs).
Subscriptions in UTI are made in dollars and the collected money was invested in India. Through Resurgent Bonds which were issued by the SBI, NRIs could invest in foreign currencies, which could help fund infrastructure projects.
The Goods and Services Tax (GST) which has become the taxation norm in the country was actually introduced in the Union Budget of 2006-07 to systematically overhaul the tax structure in the country by 2010. It
An uniform indirect tax levied on goods and services across the country, the GST, replaced central taxes like services tax, central excise tax, additional duties and customs, special additional duty of customs, besides surcharges and cesses, on supply of goods and services.
The Union Budget of 2009-10, led to the setting up of the Unique Identification Authority of India (UIDAI) which was the second term of the UPA government.
Unique Identification Authority of India (UIDAI) is a statutory body established by the government of India under the jurisdiction of the Ministry of Electronics and Information Technology (MeitY). It lead to the establishment of the Aadhar project in 2016, by which each resident of the country was given a Unique 12-digit Identification (UID) number.
P. Chidambaram in the year 2013-14, came up with the “Super-Rich Tax”, a policy which taxed individuals whose taxable income was more than Rs 1 crore. Hence, those individuals who were relatively well off had to pay 10 percent of additional surcharge.