BUDGET FOR 2014-15
Modi govt budget for middle class is committed to lower taxes, FM Arun Jaitley said that lower taxes gave people money to spend which in turn helps in economic growth , FM Hike in exemption limit in personal income tax from Rs 2 lakh to 2.5 lakh, increase in tax exemptions in investments under 80C from Rs 1 lakh to Rs 1.5 lakh, interest on housing loan from self occupied property from Rs 1.5 lakh to 2 lakh , besides a rise in investment limit in PPF from Rs 1 lakh to Rs 1.5 lakh , this helps more to salaried class, these measures could yield a maximum saving of Rs 39,655.
FM also raised the tax ememption limit of senior citizen from Rs 2.5 lakh to Rs 3 lakh and reintroduced Kisan Vikas Patras. He also introduced NSC with insurance cover to provide additional benefits to small investors.
There is no change in the rate of surcharge either for corporate or for individuals and education cess of 3% is also same.
Clean energy cess on coal raised from Rs 50 per tonne to Rs 100 per tonne, rate of basic excise duty on footwear reduced from 12% to 6%, reduction in rate of custom duty on certain commodity example LCD, LED'S abolition of 4% SAD on certain specific commodities example PVC'S, baggage allowance for passengers returning from abroad has been raised from Rs 35,000 to Rs 45,000.
Export duty bauxite raised from 10 % to 20%
Online and mobile advertising also incuded in negative list, radio taxi brought within ambit of service taxi earlier these were included in negative list, loading and unloading of transportation of cotton exempt
Indian accounting standard to be applicable optionally from FY 15-16 onwards and from FY 16-17 onwards, the same shall be mandate.
FDI in defence raised from 26% to 49%, AAR'S direct and indirect tax extended to resident private companies, no retrospective amendment in taxation.
However the FM tries to relief common man by keeping duties on commonly used day to day items unchanged and tries to make it costlier for smokers and tobacco by hike in excise rate, budget made cigarettes, aerated drinks with sugar, pan masala, gutka and chewing tobacco, Zarda- scented tobacco, radio taxi, imported electronic products, broken diamonds, portable X-ray machines costlier, and CRT television, LED/LCD TVs especially below 19 inch, footwear priced between Rs 500 to Rs 1000 per pair, soaps, desktops, laptops and tablets, RO- based water purifiers, LED lights, sports gloves, branded petrol, matchbox, life micro insurance policies, pre forms of precious and semi precious stones is cheaper
FM announced setting up of five new IITS and IIMs ,the government will set up four new AIIMS.
Budget also introduced the new scheme called "Beti Bachao, Beti padho" and allocated Rs 100cr for this in the union budget. This scheme will help in generating awareness and improve the efficiency of delivery of welfare services meant for women.
Impact on budget on Airlines
The budget has proposed introduction of e-visa to encourage foreign tourist arrivals, it does not have any short term impact but in long term it will have positive impact, besides development of Sarnath-Gaya-Varanasi Buddhist circuit as a world class tourist destination and creation of five other tourist circuits would lead to increased air travel in the long run. The govt has proposed Rs 6500 crore equity infusion in Air India.
Impact of budget on Telecom
A basic custom duty of 10% has been imposed on specified telecom products. Since large portion of the equipment used will remain subject to nil import duty this is not expected to have a significant impact, budgeted receipts from auction of spectrum and levy of one time charges have been estimated at Rs 45,400 crore for 2014-15 against Rs 40,800 crore in 2013-14.
Impact of budget on Road
In 2014-2015 the situation is expected to improve a little to around 3,500km from 2,623km in the previous year with over 80% of contract awarded on an engineering procurement construction basis. Implementation may improve a little. Proposed investment of Rs 37,880cr for national highways and state roads workout to around 12% increase over last year spend. Additionally allocation of Rs. 500cr. Could help kick start some expressway projects. The govt. Also plans to set up an institution called "3Pindia" with the corpus of Rs 500cr.
Impact of budget on Real State Sector
Budget has raise the interest subvention limit from Rs 1.5 lakh to Rs 2 lakh and overall exemption under section 80c from Rs 1lakh to 1.5 lakh. Buyer of properties priced upto Rs 30 lakh are to expected to be the biggest gainer. FDI norm in the real estate have been relaxed by reducing the minimum built up area from 50000 sq.mts to 20000 sq. mts and lowering minimum capitalization from$10m to $5m. This is expected to allow developers, especially mid-sized ones, flexibility in raising capital and consequently, infuse much needed liquidity in the sector. Currently nearly 15 - 17% of the upcoming supply falls in this category, which is likely to increase over the long term.
The FM announced a package of Rs 3,600 crore to provide safe drinking water in some 20000 habitations over the next three years. The FM also said that every household is intended to be covered by total sanitation by the year 2019, the 150 year of Mahatma Gandhi’s birth anniversary, through the Swatchh Bharat Abhiyan
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Esha Agrawal !!!!!!!!
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