India Union Budget 2023 - Live Updates

The Agriculture Accelerator Fund is a welcome move for the agricultural sector. It will act as a catalyst to spur growth in the agriculture tech ecosystem and address a few critical challenges across the value chain relating to input-output linkages, precision farming, ensuring traceability and quality of production, higher value addition, among others. This is not only going to promote entrepreneurship and job creation in this sector but also unlock value in the agribusiness value chain which in turn will boost profitability for the farmers and is a right step towards achieving the vision of doubling farmers’ income. Soumyak Biswas, Partner/ Management Consulting/ Business Advisory Services

Finance Minister Nirmala Sitharaman has made conscious efforts to make the NTR more attractive for the taxpayers. "The NTR shall now be considered as a default regime for all the taxpayers, but that does not necessarily mean a better regime for all. Taxpayers still need to look at their personal situation, various investments and expenditure that are eligible for tax exemption under the old regime and then decide which regime is better for them. – Preeti Sharma, Partner/Global Employer Services/ Tax & Regulatory Services

She sees the proposals bringing significant change in the payroll procedures of employers for salaried taxpayers. – Deepashree Shetty, Associate Partner/ Tax and Regulatory Services

PAN will be a common business identifier. This will reduce multiple requirements of KYC and will give a breather to entities by reducing the compliance burden. This is a step towards furtherance of ease of operations in India. – Manoj Purohit, Partner & Leader/ FS Tax

The proposal to make the new tax regime as the default tax regime supports the government’s initiative to digitise and simplify the tax process for individuals. This would also mean significant changes in the payroll procedures of employers for salaried taxpayers. –Deepashree Shetty, Associate Partner/ Tax and Regulatory Services

In a progressive move, the FM has announced that PAN would be used as a common identifier for all digital systems of specified Government agencies. This is expected to hasten the KYC process, faster registrations and clearances for businesses since the basic data is already authenticated once at the time of allotment of PAN. – Amit Ganatra, Partner/ Tax & Regulatory Services

The Government’s announcement to support the Hyderabad-based millet institute as a Centre of Excellence in Budget 2023-24 is not only expected to promote millets as “marvel grains” of the future but will also address multiple issues related to food security, affordable nutrition, climate change, enhancing farmers’ incomes and exports from India. The proposed centre is envisaged to play a key role in R&D activities for developing high yielding varieties and sustainable cultivation methods which may to some extent help offset the challenge of declining area under cultivation, promote value addition and product innovation ( in terms of recipes, ready-to-cook, ready-to-eat formats etc.), help in large scale adoption of bio-fortification of millets which would go a long way in addressing challenges due to nutritional deficiency. This initiative would also enable intensification in the current production belts due to constraints on land availability through improvement in yields and enable innovation through the adoption of technology led interventions in the millet value chain. –Soumyak Biswas, Partner/ Management Consulting/ Business Advisory Services

Development of sustainable cities would be focussed upon by ensuring efficient use of resources and creating opportunities for all – Siddharth Tandon, Partner/ Indirect Tax

Significant increase in capital Investment in infrastructure would help in job creation and boost economic activity – Sandeep Pareek, Partner/ Indirect Tax

MSME amnesty scheme to be introduced for addressing cases of failure in contractual obligations – Rajitha Boorugu, Partner/ Indirect Tax

The Online gaming sector needed an independent recognition which the budget proposals provided. Outlining a simplified withholding tax regime will go a long way in addressing the anxieties of online gaming intermediaries. However, certain ambiguities arising from the language of the provisions cannot be ruled out. Specified taxation mechanism for online gaming players and intermediaries demonstrates the Government’s commitment to this sunrise sector. - Pranay Bhatia, Partner/ Tax & Regulatory Services

This Budget has primarily focused on reducing the battery cell cost from the Electric Vehicle industry perspective. While the FM has allowed concessional custom duty of 5% on battery cells for another financial year, she has waived the custom duty on import of capital goods/machinery for manufacturing of Lithium-ion cells which is aimed at encouraging domestic manufacturing of cells in the medium term. This is a very positive and effective approach towards bringing down the overall life cycle cost of EVs. The industry was expecting a lot more from the FM, but given the balancing act approach adopted by her, some of the other policy supports for EV industry may have to wait for some time. - Ashish Bagadia, Partner/ Corporate Finance and Investment Banking

The Budget seems to indicate the Government’s resolve towards fiscal consolidation and moving forward with moderation. The seven priorities outlined, namely inclusive development, reaching the last mile, infra, investment, green growth, youth and financial sector, touch upon every key area that needs attention, specifically, fund deployment for development of infrastructure, green growth, job creation, upskilling of youth, and investments for holistic growth of the country. - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Centre of Excellence for Artificial Intelligence to be set up in select top institutions in partnership with top industry players for enhancing India Inc’s abilities to adopt new technologies – Maulik Manakiwala, Partner/ Indirect Tax

Three-fold increase in Capital Investment in infrastructure as compared to FY 2019-20 to help job creation and boost economic activity Sandeep Pareek, Partner/ Indirect Tax

Announcement on limit of deduction u/s 54 and 54F to INR 10 crores appears to be one more provision for curbing tax exemption to HNIs and Ultra HNIs. A similar measure was introduced in an earlier Budget on PF contribution limitation for tax free interest income. - Amit Ganatra, Partner/ Tax & Regulatory Services

Appointing 100 new Joint Commissioners to reduce pending litigation is a welcome move. This is expected to clear the long pending disputes with tax authorities. - Pradeep Kasthala, Partner/ Tax & Regulatory Services

In view of the Government’s vision of ‘ease of doing business’ a unified filing system will be set up to avoid separate submissions to several government agencies. - Payal Thaker, Partner/ Indirect Tax

Government support in research and innovation will further give teeth to PLI schemes and Make in India. Research centric sectors such as pharma, green energy, etc., will benefit from such support. - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Availability of anonymous data for use in various data modelling and analytics would be brought through a data protection bill - Rahul Aggarwal, Partner & Tax Tech Lead / Technology Products and Solutions, BDO Digital

States to setup unity mall for encouraging sale of ‘one district once product’ and support local industries – Pratik Shah, Associate Partner/ Indirect Tax

Additional airports, heliports, water aerodromes, and advanced landing zones will give a much-needed thrust to the Aviation sector. Incentives for this sector could additionally aid growth – Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Customs duty reduction for bicycles, lithium-ion batteries amongst other select goods for boosting manufacturing for green mobility sector - Smita Roy, Partner & Leader (North)/ Indirect Tax

Setting up of EXIM bank subsidiary in IFSC will promote trade financing and fasten money cycle. - Manoj Purohit, Partner & Leader FS Tax, Tax & Regulatory Services

The New Pharma Programme for R&D should provide impetus to reach the next level of being a global leader for the sector by increasing the productivity and specialisation and also rationalising the costs of pharma products. - Rajitha Boorugu, Partner/ Indirect Tax

Relief on customs duty on import of camera lenses and lithium-ion battery for use in mobile phones. This will boost the domestic mobile manufacturing industry - Abhishek Singhania, Director/ Indirect Tax

The indirect tax proposals focus on reduction of duties on raw materials like seeds for lab grown diamonds, parts of mobile phones, TV panel parts, steel sector etc., and propose to impose duties on import of final products like compounded rubbers etc., in a bid to create a level playing field for domestic manufacturers. - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Measures adopted in customs to harmonise BCD rates in line with the Government’s focus on encouraging domestic production and promoting exports - Kartik Solanki, Partner/ Indirect Tax

Green mobility finds impetus by reduction of customs duty on various goods - Sandeep Pareek, Partner/ Indirect Tax

Plan to scrap old, polluting vehicles of Central and State governments is a right step to reduce pollution and create demand - Dinesh Kumar, Partner/ Indirect Tax

Sustainable farming, afforestation and enhancement of biodiversity finds special focus - Sandeep Pareek, Partner/ Indirect Tax

Focus on enhancing business at GIFT IFSC by avoiding dual regulation, single window registration under multiple legislation, amending IFSC act for arbitration and ancillary services – Maulik Manakiwala, Partner/ Indirect Tax

Customs duty reduction on import of certain parts of mobiles to encourage mobile production in India - Krishna Barad, Partner/ Indirect Tax

Ease of doing business, green growth, inclusive development, revival of heavy hit sectors, boost to domestic manufacturing, focus on technology driven measures, encouraging investment and employment generation at the core of the Budget. Promising path towards strengthening the economy – Smita Roy, Partner & Leader (North)/ Indirect Tax

Indirect Tax proposals are focused on promoting export, manufacturing, green energy and mobility - Siddharth Tandon, Partner/ Indirect Tax

Steel sector in focus with continued BCD exemption on raw materials - Krishna Barad, Partner/ Indirect Tax

India being a global leader in diamonds and in order to promote lab grown diamonds, import duty on seeds used for development of diamonds reduced - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Ease of doing business, green growth, inclusive development, revival of heavy hit sectors, boost to domestic manufacturing, focus on technology driven measures, encouraging investment and employment generation at the core of the Budget. Promising path towards strengthening the economy. - Smita Roy, Partner & Leader (North)/ Indirect Tax

Green growth focus of the Union Budget should boost manufacturing, encourage green investment, generate employment and enable a sustainable lifestyle. It is a welcome step in the long-term vision of sustainable and green development and achieving net zero commitments. - Smita Roy, Partner & Leader (North)/ Indirect Tax

Amendments proposed in the Banking Regulation Act will improve governance and investor protection - Sandeep Pareek, Partner/ Indirect Tax

Single window for registration under IFSCA viz registration and approval of IFSC, SEZ, RBI, IRDAI under a single window will ensure ease of entry for foreign entities, thereby reducing compliance burdens and cutting down lengthy procedures and substantially reducing the onboarding time for set up. - Manoj Purohit, Partner & Leader FS Tax, Tax & Regulatory Services

Customs duty relaxation for lab grown diamonds will bring relief to the gems and jewellery sector. The move will help reduce import dependence. The fund allocation towards research will also encourage domestic production. - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

A further step to democracy in the nation, public consultation would be adopted for review of various acts and regulations. These would make the laws & regulations more adaptable expecting higher level of compliances and adherence. - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Clear focus on making India a tourist friendly destination through the introduction of schemes like ‘Dekho Apna Desh’ and also by developing an app for tourism and guide. Tech based tourism guide would help remote areas in India to grow and generate jobs. - Kartik Solanki - Partner/ Indirect Tax

Increase in the limit in investment in the senior citizen scheme by additional 15 lacs to 30 lacs will encourage senior citizens in India to invest more in the scheme, as it is has a relatively higher fixed interest rate and is more secured as compared to other investment opportunities. - Anish Shah, Partner/ M&A Tax and Regulatory

Permitting acquisition financing by units of foreign banks in IFSC is a step in a right direction and would help in reducing the cost of financing outbound M&A, thereby supporting Indian corporates looking to do overseas acquisitions. - Samir Sheth, Partner and Head/ Deal Advisory Services

The agenda of 50 additional airports, heliports, water aerodromes, and advanced landing zones will give a much needed boost the Aviation sector. Incentive schemes could also additionally help this sector grow. - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

The plan to scrap old, polluting vehicles of the Central and State Governments is a right step to reduce pollution and create a demand for EVs. This would also bring the Government a step closer to the vision of 100% EVs by 2030. - Dinesh Kumar, Partner/ Indirect Tax

Making ODI as a valid instrument for trading in IFSC exchanges will clear long pending doubts around the legality of trading in such instruments in IFSC exchanges. - Manoj Purohit, Partner & Leader FS Tax, Tax & Regulatory Services

Amending the IFSCA Act to be in line with the Arbitration related regulations shows the Government’s intent to reduce litigation related powers offshore and make inhouse centres for addressal of disputes in the IFSC itself. - Manoj Purohit, Partner & Leader FS Tax, Tax & Regulatory Services

The FM clearly aims to capitalise on the upcoming aspirational recession in the Western countries and make India the “go to Hub” for manufacturing, technology and skilled manpower. Allocation towards infrastructure, emphasis on 5G, capitalising on AI and empowering businesses by Greenpower initiatives will cohesively act as a catalyst to make India Inc competent to serve global needs. - Harry Parikh, Partner/ M&A Tax and Regulatory Services

Green credit program to be notified under the Environment Protection Act for incentivising eligible companies following green policies resulting in overall reduction of carbon footprint - Maulik Manakiwala, Partner/ Indirect Tax

The Government continues to focus on the use of technology in order to bring in Minimum Government and Maximum Governance. The announcement to set up three centres of excellence for artificial intelligence to enable 'Make AI for India' and 'Make AI work for India' will further help India in its growth trajectory with able use of technology. - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Expansion of Digi locker services to the Fintech sector will be a great boost for individuals, banks and financial institutions to store and share data online in a secured and faster manner - Anish Shah, Partner/ M&A Tax and Regulatory

Coastal shipping to be promoted for transportation of cargo and people for enhancing in country mobility – Balachandar N, Partner/ Indirect Tax

Green growth focus of the Union Budget should boost manufacturing, encourage green investment, generate employment and enable sustainable lifestyle – Smita Roy, Partner & Leader (North)/ Indirect Tax

National Green Hydrogen mission would remain a key focus to reduce reliance on fossil fuels and adopt energy transition –Siddharth Tandon, Partner/ Indirect Tax

Availability of anonymous data for use in data modelling and analytics would be facilitated through a data protection bill – Rahul Aggarwal, Partner & Tax Tech Lead / Technology Products and Solutions, BDO Digital

Unified filing system based on PAN will be set up to avoid separate submissions to several government agencies – Payal Thaker, Partner/ Indirect Tax

Government support in research and innovation will give impetus to PLI schemes and Make in India. Research centric sectors such as pharma, green energy, etc. will benefit from such support. – Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Union Budget 23-24 turns out to be a much-awaited relief for the battered tourism sector. Specific focus on this sector will help this industry rebound. - Gunjan Prabhakaran, Partner & Leader/ Indirect Tax

Back to basics with a thrust to the Agricultural sector including fiscal and advanced digitisation efforts augurs well for the primary sector. - Abhishek Anand, Partner/ Indirect Tax

Centre of excellences (COE) for pharma research should help in rationalising the cost of pharma products as well as increasing productivity and specialisation in the sector. - Maulik Manakiwala, Partner/ Indirect Tax

Research and innovation in pharmaceuticals to be focussed on involving industry participation - Siddharth Tandon, Partner/ Indirect Tax

Significant boost to agriculture and fisheries with digital public infrastructure and special schemes - Siddharth Tandon, Partner/ Indirect Tax

Cluster based and value chain approach for farmer, state and industry for enhancing farm output - Siddharth Tandon, Partner/ Indirect Tax

The Government will focus on green and sustainable growth across sectors which would create significant job opportunities - Siddharth Tandon, Partner/ Indirect Tax

Assistance packages for artisans to improve quality and integrating MSME value chain - Siddharth Tandon, Partner/ Indirect Tax

25% YoY increase in GST revenue in 2022-23 clears deck for the next level of GST reforms i.e., inclusion of petroleum/power GST regime, recalibration of tax brackets from the current 5 to 2/3, depopulation of high -rate schedule, phase-out of exemptions, broad-banding of input credit regime, etc. - Dinesh Kumar, Partner/ Indirect Tax