Key Takeaways from Budget 2022-23

Finance Minister Nirmala Sitharaman presented her fourth straight Union Budget in the Parliament on 1st February 2022.

Let’s have a look at the key takeaways from Budget 2022-23

1. Taxation of Digital Assets

• Any profit from the transfer of any virtual digital asset ( includes cryptocurrency and NFT) will be taxed at 30 percent.

• Tax must be deducted at source on the payment made in relation to transfer of a virtual digital asset at 1% of such consideration above a threshold.

• Digital assets received as gift shall be taxed in the hands of the recipient.

• Losses from Virtual digital assets shall not be allowed to set off against any other gain

2. Updating the Filed Returns

• Taxpayers now have an opportunity to correct errors and file updated returns within two years i.e the return For FY 2020-21 can be updated till 31st March 2024.

3. Surcharge on Long Term Capital Gains

• The surcharge on long-term capital gains arising from the transfer of any type of asset has been capped to 15 percent. Previously the maximum rate of surcharge was 37% over and above the tax rate if income was above Rs. 5 crores.

4. Digital Rupee

• The Reserve Bank of India will issue a digital currency based on blockchain and other technology starting in FY23. “Introduction of Central Bank Digital Currency will give a big boost to digital economy,” the Finance Minister stated.

5. 5G rollout

• Spectrum auctions will be conducted in 2022 to facilitate the rollout of 5G mobile services by private telecom companies.

6. Reduction of Duties on Diamond

• Custom duty on cut and polished diamond, gemstones have been reduced to 5% and has been made nil for sawn diamond in order to boost the sector.

7. Other Initiatives

• 25,000 KMs of National Highways to be constructed in 2022

• 100 New Cargo Terminals

• Creation of a Digital University under the PM e-Vidya Scheme

• More budget spending on affordable housing. Meaning more houses for lower income groups

• More than 35% increase in the budget allocation for Infrastructure Projects

• Issuing e-Passports to help faster and easier processing of Passports

• Post Offices to be brought under the Central Banking System (CBS) like Banks

• Companies can be wound up if no business activity for 6 months as compared to earlier requirement of 24 months

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