This is the 3rd budget by Pranab Mukharjee and there were great
expectations from it especially from city folks and salaried class which gave massive support to Congress so as to enable it to sweep cities like Delhi,in the recent polls..
Sadly it looks like Mukharjee has bongled and this budget offers little and is expected yet again to increase the fiscal deficit and is inflationary and sufficiently ambiguous, as many things haven’t been provided for, especially the expected expenditure under new food guarantee act.
This reminds me of Mr PCs qoute “Trust me. Do you think I am so stupid as to not provide funds for such an important scheme?” that on the NREGS and the results are plain to see. More ambiguity means more corruption and lack of clear thinking not good in an economic downturn.
What matters most- DIRECT TAXES
Other than the lollipop of increased rebate of 10000, just so that there is a rosy headline in tomorrows papers, there is nothing on offer to the middle and salaried class that pays between 10 and 30% income tax.
New Cut-offs/ Exempt limit for tax free income will be
240000 for SENIOR CITIZENS
190000 for RESIDENT WOMEN TAXPAYERS
160000 for RESIDENT MEN.
Surcharge Scrapped: 10 lakh + earner gets relief.
Direct Benefits: Less than a Rs100 a month. A mere 1000 Rs a yr tax rebate that when CPI inflation has been in double digits for an extended period of time.
Come on folks – We are the Middle Class, not the UPAs aam admi ,we don’t vote anyways so will never have a voice or be on the FMs mercy radar.
Sec 80DD: Disabled Dependents : Increase in scope and rebate to Rs 1 lakh.
Sec 80E: Deduction on Education loan scope increased to cover Vocational training after class 10.
EET OR No TAX EXEMPTION for NPS or NATIONAL PENSION SCHEME :
Fm had declared the income on investments into the NPS trust as tax free and free of STT and DDT , not the proceeds so it is in effect still EET to the investor, but at reduced costs .
This is a big plus disappointment / let down for unorganised sector worker who was expecting it to be an EEE scheme so the govt is not too serious on implement the NPS, which would never have taken off without this exemption. Is it is time i seriously consider opening an NPS account?
I think i should Wait and Watch and Rethink especially if i want to invest big money in it on a yearly basis.
No change in tax rates (expected)
FRINGE BENEFIT TAX Scrapped (again expected)
81 D (9) Benefits extended to natural gas and bidders of NELP8
MAT (minimum alternative tax) rate to be increased to 15% versus 10% of book profit
Sunset clause extended by one year and tax holidays for exporters is extended to 2011
GST to come into effect from April 01, 2010 ??? is it possible
CTT on Commodities abolished. A big relief to commodity traders
No change in status quo on STT. Govt to hold 51% in PSUs.
Market operators will be unhappy and markets will go down.
Mukherjee Doubled import duty on gold bars from Rs 100 per 10 gram to Rs 200 per 10 gram, while other forms of gold (excluding jewellery) is increased from Rs 250 per 10 gram to Rs 500 per 10 gram.
Full exemption from excise duty on branded jewellery. who buys branded?
5% Customs duty on STBs – bad for dth and cable operators.
5% Customs duty on LCD panels – Will the producers of lcd tvs pass on the benefits ?
The Total budget expenditure for 2009-10 will Rs 10,28,032 crore, crossing Rs 10 lakh crore mark.The targetted fisc deficit will go up from last yrs estimate of 2.7% to 6.8% which means the govt has estimated something close to the last yrs actual deficit of 6.07 percent which was revised to 6 percent of gross domestic product from an initial estimate of 2.5 percent. Can the govt balance its books ? I doubt it, if we look at the govts past performance. Worse with the State Centre and the off budget expenses last yr the fiscal deficit was between 11and 11.5%, any guesses to the current deficit?
Subsidy bill will no doubt go up. No mention however of accountability that will reduce corruption and leakages.
The government plans to borrow nearly Rs 4,00,000 cr from markets during 2009-10, a rise of about 50% over what it borrowed a year ago, to fund the widening fiscal deficit. Thats like 4.51 trillion rupees or $93 Billion!.
National ID Card provision of Rs 120 crore and is expected to be implemented within 1.5yrs Read this wonderful article for more on that project.
Crop loan at 6 pc interest for farmers on short term crop loan
for farmers who pay their dues in time.
An allocation of Rs 39,100 crore to be made for NREGA in
2009-10, an increase of 144 per cent.
Gram Sadak Yojana allocation has been hiked up 59% to Rs 12000 crore.
Rs 2,000 crore for rural housing fund under National Housing Bank. Indira Awas Yojana, allocation to be increased by 63 per cent in 2009-10 to touch Rs 8,800 crore.
Rs 7,000 crore to rural electrification scheme.
Direct transfer of subsidy to farmers being worked out.
Subsidy regime for fertilisers to change to nutrient- based rather than price-based.
This could be revolutionary if implemented correctly.
NHAI allocation up by 23 per cent.
Allocation for the Railways has been increased from Rs.10,800 crore made in the Interim Budget for 2009-10 to Rs.15,800 crore
New funds allocation to the Jawaharlal Nehru National Urban Renewal Mission (JNNURM) being stepped up by 87 per cent to Rs.12,887 crore in the current budget.
Brihan Mumbai Storm Water Drainage Project (BRIMSTOWA)
More funds of Rs.500 crore allocated to help Mumbai fight floods during rains.
Provision for Rajiv Awas Yojana (RAY) to improve the lot of the urban poor.
New DIRECT TAX code to be implemented in 45 days
will it make the complex it return forms and procedures and the harassment go away?
New Arbitration panel for tax litigation cases.
Karnataka will have a tax database for all returns filed digitally.
A sign of automantion but still very ambiguous – Will this
offer any real change in the Tax officer raj? when most refunds
are never sent electronically, refunds require 10% speed money,
and harassment of small taxpayers under draconian scrutiny laws
100 per cent tax deduction for donations for electoral funds
How will it really increase accountability? No political party returns are scrutinized anyways and are out of? the ambit of RTI.
bored , Frustrated , irritated ? chk out Fallen Princesses