From real estate to metals, here's how the Budget affects key sectors

How the Budget affects key sectors of the economy

Real Estate & Infrastructure

What was expected?
 

• Extension of sunset date for obtaining approval from competent authority in case of affordable housing projects
• Enhancement of deduction of interest on funds borrowed for purchase of house property, including affordable housing

What was delivered?

• Affordable housing projects eligible for tax holiday, now extended to cover projects approved till 31 March 2022. Benefit also extended to developers of affordable rental housing projects. 
• Loan sanction date extended to 31 March for additional interest deduc­tion for  affordable residential house

Automotive

What was expected?

• Incentivize vehicle scrappage policy
• Increased focus and government spend on transport sector 
• Resolution of inverted duty structure for electric vehicle sector 
• Reduction of GST rates on vehicles for entry level vehicles
   

What was delivered?

• Introduction of scrapping policy for old and unfit vehicles 
• Government to spend INR 18,000 crore to augment public bus transportation in India 
• Increase in BCD on specified auto parts

IT & Telecom

What was expected?

• Clarity on applicability of withholding tax on cloud-based transactions 
• Favourable policies for creating digital infrastructure and ecosystem
• Incentives for research and development of next-gen technologies

What was delivered?

• Withholding tax @ 0.1% on purchase of goods in excess of 50 lacs 
• To incentivise digital transaction, limit for tax audit for persons with 95% digital transactions increased from 5 crore to 10 crore

Financial Services

What was expected?

• Increase in FDI in insurance sector 
• Divestment of government stake in PSBs
• Tax rationalisation for foreign bank branches to ensure a level-playing field
   

What was delivered?

• FDI limit in Insurance sector  increased from 49% to 74%
• Privatization of 2 PSBs and 1 General Insurance company has been proposed in addition to capital infusion of 20,000 crores in PSBs
• Relaxed 'Demerger' provisions for PSUs

Metals

What was expected?

• Reduction in customs duties for Gems and Jewellery  
• Reduction in customs duties on metals & elimination of GST compensation cess on coal
• Review of anti-dumping for various steel products

What was delivered?

• Reduction in BCD on gold silver to 7.5%
• Reduction in BCD on specified iron, steel & copper items
• Temporary revocation of anti-dumping duties for specified steel items

Disclaimer: The data have been provided by EY. Neither EY nor Business Standard is liable for any action taken on the basis of this data