Union Budget: Highlights 3

Here are some more announcements made by the finance minister during the presentation of the Union Budget in Parliament today.

  •  Fiscal deficit target for 2011-12 at 4.6%, lower from the 5.1% estimate for current fiscal.
  •  Total expenditure estimated at Rs12,57,729 crore for the current fiscal; gross tax receipts at over Rs9.3 lakh crore.
  •  To raise housing loan limit from Rs20 lakh to Rs25 lakh for priority sector lending; 1% interest rate subsidy for home loans up to Rs15 lakh.
  •  To give Rs6,000 crore to public sector banks for maintaining capital-to-risk assets ratio norms.
  • Tax-free bonds of Rs30,000 crore to be issued for infrastructure development. This will cover Warehousing Corporation, National Highways Authority of India, Indian Railways Finance Corporation and Housing and Urban Development Corporation.
  • Credit flow to farmers to be raised from Rs3.75 lakh crore to Rs4.75 lakh crore.
  •  Existing interest subvention scheme on short-term farm loans at 7% interest to continue.
  •  Allocation under Rashtriya Krishi Vikas Yojana to be raised from Rs6,755 crore in the current year to Rs7,860 crore.
  •  To provide Rs300 crore to promote pulses cultivation in rain-fed areas and another Rs300 crore to promote farm product cultivation.
  •  To promote organic farming methods to enable farmers get best from their land.


Union Budget: Fiscal deficit for FY’11 at 5.1% ; FY’12 seen at 4.6%

The higher-than-expected non-tax revenues from 3G and Broadband Wireless Access (BWA) spectrum auction has helped the government peg the fiscal deficit for the current fiscal to 5.1% and 4.6% for 2011-12

New Delhi: Led by higher than expected non-tax revenue like auction of third generation (3G) spectrum, finance minister Pranab Mukherjee today pegged the fiscal deficit at 5.1% for the current financial year, and further reduced the estimates to 4.6% for 2011-12, reports PTI.

Mr Mukherjee said the revenues from 3G and Broadband Wireless Access (BWA) spectrum auction (that garnered Rs1.08 lakh crore) has helped government reduce the fiscal deficit for the current fiscal, from 5.5% estimated earlier.

“Due to the higher than anticipated non-tax revenue from 3G spectrum auction... I have brought down the fiscal deficit from 5.5% to 5.1% of the gross domestic product (GDP) for 2010-11,” Mr Mukherjee said in his 2011-12 Budget speech.

“During the course of 2010-11, I had the opportunity to bring in improvement in fiscal balance,” he said.

“For the year 2011-12 I have kept it (fiscal deficit) at 4.6% of GDP which improve upon my own target of 2011-12 indicated in the fiscal roadmap presented in the last budget,” Mr Mukherjee said.

The pre-budget Economic Survey tabled in Parliament last week had pegged the fiscal deficit for the current fiscal at 4.8%.

India’s fiscal deficit had ballooned to 6.3% of the GDP in 2009-10 in view of stimulus spending worth billions of dollars to combat global financial meltdown.

In the medium-term fiscal policy, Mr Mukherjee pegged the rolling target of fiscal deficit at 4.1% for 2012-13, and 3.5% for 2013-14.

In his budget speech, Mr Mukherjee pegged the revenue deficit for the current fiscal and 2011-12 at 2.3% and 1.8% respectively.

The government had in 2010 mobilised Rs1.08 lakh crore from auctioning of spectrum for 3G and broadband wireless access (BWA) services. Besides, it also followed the path of consolidation during April-December of 2010-11, as it partially withdrew the sops given to the industry in 2008 and 2009.

Stimulus package provided by the government at the time of financial meltdown helped India to grow by 6.8% in 2008-09, and by 8% in 2009-10.


Union Budget : Highlights Taxation

Proposal to hike income tax exemption limit for individuals along with significant benefits for senior citizens

New Delhi: Finance minister Pranab Mukherjee today proposed hiking the income tax exemption limit for individuals along with significant benefits for senior citizens, the retention of 10% service tax and withdrawal of some previous duty exemptions. Following a some tax-related highlights from the finance minister's Union Budget presented in Parliament today.

  • Tax exemption limit for individuals raised from Rs1.60 lakh to Rs1.8 lakh.
  •  The qualifying age for senior citizens category has been lowered to 60 years and exemption limit for senior citizens has been raised to Rs2.50 lakh; senior citizens over 80 years to get income tax exemption of Rs5 lakh.
  •  Surcharge for companies cut to 5% from 7.5%.
  • A new revised income tax return form 'Sugam' to be introduced for small tax papers.
  • Service tax retained at 10%; duty exemptions to be withdrawn on various items.
  •  Net loss from direct tax proposals estimated at Rs11,500 crore for the year.
  •  Excise and customs duty proposals to result in net gain of Rs7,300 crore.
  •  Standard rate of central excise duty maintained at 10%; no change in CENVAT rates.
  •  Nominal 1% central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery to be exempted.
  •  Peak rate of customs duty maintained at 10% in view of the global economic situation.
  •  Basic customs duty on agricultural machinery reduced to 4.5% from 5%.
  • Service tax widened to cover hotel accommodation charging above Rs 1,000 a day, A/C restaurants serving liquor, some category of hospitals and diagnostic test centres.
  •  Service tax on air travel increased by Rs50 for domestic travel and Rs250 for international travel in economy class. On higher classes, it will be 10% flat.




6 years ago

Black money overseas is reported to have accumulated over & above 50 Lakh Crore Rupees. If that is brought back to India, No Problem'o.


6 years ago

Tax limit raised is just an eyewash, benefit passed on can not be regarded as perceptible looking at real inflation ( book value is misleading). The budget does not really deserve any applause as some politically affiliated persons may take this opportunity. Disappointing budget as it was last year also. No effort to bring back black money of swiss bank owned by heavyweights, this was major issue, if one can really understand.

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