Union Budget: Highlights 4

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

  •  NABARD's capital base to be strengthened; Rs10,000 crore to be provided as short term credit fund.
     
  •  To increase the rural housing fund to Rs3,000 crore.
     
  •  To create a women's self-help group development fund with a corpus of Rs500 crore.
     
  •  Capital investment in fertiliser production to be considered as infrastructure sub-sector.
     
  • A new scheme to be introduced for refund of service tax on lines of drawback of duties.
     
  •  Proposal to introduce self-assessment of customs duty whereby importers and exporters will themselves assess payment of duty.
     
  •  Remuneration of anganwadi workers raised from Rs1,500 to Rs3,000 a month. Helpers at anganwadis to get Rs1,500, up from Rs750 previously.
     
  •  Old age pension to persons over 80 years raised from Rs200 to Rs500.
     
  •  Compensation of Rs9 lakh to be given to men of defence and central paramilitary forces for permanent disability and discharge from service.

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Union Budget: Corp tax surcharge reduced to 5%; MAT raised marginally

The reduction in surcharge will bring some cheer to industry which has been clamouring for a reduction in corporate tax rate to 25%. The finance minister also proposed a lower rate of 15% tax on dividends received by an Indian company from its foreign subsidiary

The reduction in surcharge will bring some cheer to industry which has been clamouring for a reduction in corporate tax rate to 25%. The finance minister also proposed a lower rate of 15% tax on dividends received by an Indian company from its foreign subsidiary

New Delhi: Bringing some cheer to the industry, finance minister Pranab Mukherjee today lowered the surcharge tax limit on corporate tax to 5% from 7.5% even while marginally raising the Minimum Alternate Tax (MAT), reports PTI.

The government retained the corporate tax at 30%, to be paid by domestic firms earning total income of over Rs1 crore a year. It increased the MAT to 18.5% from 18% on book profits.

Presenting the Budget for 2011-12, finance minister Pranab Mukherjee said: "My initiative of phasing out the surcharge continues. I propose to reduce the current surcharge of 7.5% on domestic companies to 5%."

The minister also proposed to bring developers in Special Economic Zones (SEZs) under the MAT.

"By the measure to ensure equal sharing of corporate tax liability, I propose to levy MAT on developers of SEZs as well as units operating in the states," Mr Mukherjee said.

The reduction in surcharge will bring some cheer to industry which has been clamouring for a reduction in corporate tax rate to 25%.

Industry chambers have been demanding reduction in corporate tax to 25% to spare the India Inc with more money to undertake big-ticket investments.

With a view to providing incentive for Indian companies to repatriate money from offshore subsidiaries, the minister also proposed a lower rate of 15% tax on dividends received by an Indian company from its foreign subsidiary.

"I do hope this will allow funds to flow to India," he said.

The latest proposals come two years after the government did away with surcharge on income tax during the 2009-10 Budget.

During last year's budget also, the government had reduced surcharge on corporate tax while hiking the rate of MAT.

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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.

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