The Finance Ministry announced fresh stimulus measures for the economy today. The total demand boost due to today's measures expected to be more than Rs 1 lakh crore. The government announced LTC Cash Voucher Scheme. Under LTC Cash Voucher Scheme, government employees can opt to receive cash amounting to leave encashment + 3 times ticket fare, to buy something of their choice. The items bought should be those attracting GST of 12% or more. Only digital transactions are allowed, GST Invoice to be produced. Estimated cost of LTC Cash Voucher Scheme for Central govt is Rs 5,675 crore and for PSBs & PSUs is Rs 1,900 crore. The ministry expects the LTC Cash Voucher Scheme to generate additional consumer demand in the range of Rs 28,000 crore.
The Special Festival Advance Scheme which was meant for non-gazetted government employees is being revived as a one-time measure, for gazetted employees too. All central govt. employees can now get interest-free advance of Rs. 10,000, in the form of a prepaid RuPay Card, to be spent by March 31, 2021.
The ministry also came up with a Capital Expenditure Boost for States in the form of a special interest-free 50-year loan to states is being issued, for Rs 12,000 crore capital expenditure. Capital expenditure - money spent on infrastructure and asset creation - has a multiplier effect on the economy, it not only improves current GDP but also future GDP, we want to give a new thrust to capital expenditure of both states and Centre
A fresh Capital Expenditure Boost for the Centre is also announced with an additional budget of Rs 25,000 crore (in addition to Rs 4.13 lakh crore given in Budget 2020-'21) for capital expenditure on roads, defence, water supply, urban development and domestically produced capital equipment.
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