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bird eye view of union budget 10-11

CA kuldeep kothari (own practice) (375 Points)

26 February 2010

hy friends we are posting the self prepared highlights of union budget 2010

will be useful for all

pls share ur views n smthng new if it comes to ur knowledge

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CA kuldeep kothari (own practice) (375 Points)
Replied 26 February 2010

pls thank my profile if like this

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CA kuldeep kothari (own practice) (375 Points)
Replied 26 February 2010

sorry guys previous attached file don't have proper font colors

i m uploading the file again

Attached File : 8 union budget 2010 11.doc downloaded: 368 times

CA kuldeep kothari (own practice) (375 Points)
Replied 26 February 2010

UNION BUDGET -2010-11

HIGHLIGHTS OF UNION BUDGET 2010-11 BY KULDEEP KOTHARI AND GOVIND SHARMA(CA FINAL-DELHI):

Ø SLAB RATES:

INDIVIDUALS/NRI: WOMEN:

INCOME TAX RATE INCOME TAX RATE

UP TO 160000- NIL UP TO 190000- NIL

160001-500000- 10% 190001-500000- 10%

500001-800000- 20% 500001-800000- 20%

ABOVE 800000- 30% ABOVE 800000- 30%

SENIOR CITIZEN:

INCOME TAX RATE

UP TO 240000- NIL

240001-500000- 10%

500001-800000- 20%

ABOVE 800000- 30%

Ø ITR-SARAL 2 OF 2 PAGES FOR INDIVIDUALS AND SALARIED CLASS TAX PAYERS

Ø 80C DEDUCTION INCREASED TO 120000 FROM 100000-20000/- DEDUCTION ON LONG TERM INFRASTRUCTURE BONDS.

Ø HEALTH INSURANCE SCHEME APPROVED BY CG INCLUDED IN 80C’S DEDUCTON CRITERIA

P/G/B/P:

SEC 35(2AB):-IN HOUSE SCIENTIFIC RESEARCH-WEIGHTED DEDUCTION INCREASED FROM 150% TO 200%

SEC 35 (2AA) AND 35 (1)(ii),(iii)- WIEGHTED DEDUCTIONS INCREASED FROM 125% TO 175%

44AB-TAX AUDIT LIMITS- FOR BUSINESS :60LACS FROM 40 LACS

FOR PROFESSIONS:15 LACS FROM 10 LACS

PRESUMTIVE TAXATION:LIMIT INCREASED TO 60 LACS FROM 40 LACS

CA kuldeep kothari (own practice) (375 Points)
Replied 26 February 2010

OTHERS

o LLP(LIMITED LIABILITY PARTNERSHIPS):-EXEMPT FROM CAPITAL GAINS TAX ON COVERSION OF A BUSS. ENTITY IN TO LLP.

o SETTLEMENT COMMISSION’S SCOPE WIDENED:- NOW THE CASES WHICH ARE PENDING IN SEARCH AND SEIZURE CAN ALSO BE SETTLED THROUGH THE SETTLEMENT COMMISION

o TRUST:- AT PRESENT IF ANY TRUST IS CARRYING OUT ANY BSINESS ACITIVITY THEN THE INCOME FROM SUCH BUSINESS ACTIVITY IS TAXABLE BUT NOW IF THE INCOME FROM SUCH ACTIVITY IS UP TO 10 LACS THEN IT IS EXEMPT FROM TAX.

o TDS:- NOW ANY EXPENDITURE WILL BE ALLOWED AS DEDUCTION IF TDS IS DEDUCTED DURING ANY TIME IN THE FINANCIAL YEAR AND DEPOSITED ON OR BEFORE THE DUE DATE OF FILING OF RETURN.

o IF TAX DEDUCTED AND NOT DEPOSITED THEN INTEREST WILL BE 18% P.a. FROM EXISTING 12

o EMPHASIS ON INVESTMENT BASED INCENTIVES RATHER THAN PROFIT LINKED INCENTIVES- 2 STAR AND MORE CATEGORY HOTELS ANY WHERE IN INDIA ARE INCLUDED IN EXEMPTION CRITERIA

o HOUSING PROJECT ELIGIBLE FOR DEDUCTION UNDER 80IB IN WHICH IF ANY HOUSING PROJECT IS APPROVED ON OR AFTER 1^ST DAY OF APRIL 2004 THEN IT HAS TO BE COMPLETED IN 4 YEARS NOW THIS 4 YR LIMIT IS INCREASED TO 5 YEARS

FOR DOMESTIC COMPANIES :

SURCHARGE :_7.5% FROM 10%

MAT(MINIMUM ALTERNATE TAX):18% FROM 15%( EFFECTIVE RATE IS 19.9305% i.e. 18% basic+7-5% surcharge and 3% education cess on total)

CONCLUSION:-FINANCE MINISTER HAS TRIED TO COMPENSATE THE INCREASE OF MAT BY REDUCING SURCHARGE

CA kuldeep kothari (own practice) (375 Points)
Replied 26 February 2010

GENERAL:

§ CENTRALIZED RETURN PROCESSING CENTRE WHICH IS CURRENTY FUNCTIONING AT BENGLURU AND IS PROCESSING 20000 RETURNS A DAY.

NOW THE GOVT. WILL ACT TOWARSD SETTING UP 2 MORE CENTRES.

§ THE ABOVE CHANGE IN SLAB RATES WILL RESULT IN MAXIMUM BENEFIT OF 50000+1500(ed. Cess)+30% of 20000(increased 80c)=57500/- if earning is more than 8 lacs.

§ IT WILL INCRAESE THE DISPOSABLE INCOME OF “AAM AADMI”

WHICH WILL RESULT IN HIGHER PURCHASING POWER AND MORE INFLOW CASH IN MARKET.

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CA kuldeep kothari (own practice) (375 Points)
Replied 26 February 2010

INDIRECT TAXES

Ø RATE OF CENTRAL EXCISE DUTY WILL BE INCREASED TO 10% FROM 8%

Ø DUTY ON MUV’S,SUV’S:-22% FROM 20% THIS WILL RESULT IN INCREASE IN PROCES OF CARS

Ø BED ON:

CRUDE-5%

DIESEL AND PETROL-7.5%

OTHERS PETROLIUM PRODUCTS-10%

Ø ADVELOREM DUTY – ON 1/- PER LITRE ON DIESEL AND PETROL

IT WILL INCREASE IN PRICES OF FUEL UP TO 2.5 RS..

Ø NON SMOKING TOBACCO AND CHEWING TOBACCO- COMPOUNDED LEVY SCHEME WILL BE INTRODUCED ON MACHINE CAPACITY BASIS

Ø SMALL SCALE INDUSTRIES:- FULL CREDIT ON CAPITAL GOODS WILL BE ALLOWED IN THE YEAR OF RECEIPT AT A TIME.AND WILL FILE RETURN QUARTERLY INSTEAD OF MONTHLY .

Ø BCD AND SPECIAL DUTY ON LED.S AND LIGHTS ETC-4% FROM 8%

IT WILL RESULT IN CHEAPER LED TV’S AND LED LIGHTS ETC

Ø ELECTRIC RIKSHAWS :- 4% EXCISE DUTY AND MATEIALS AND COMPONENTS USED IN MANUFACTURING OF SUCH RIKSHAW WILL BE EXEMPT FROM BASIC CUSTOM DUTY

Ø TELECOM SECTOR- THE EXEMPTION OF BCD AND SPECIAL CVD FOR DOMESTIC MOBILE MANUFACTURING CO. WILL EXTENDED TO BATTERY CHARGERS AND HANDSFREE ALSO.AND TIME PERIOD IS EXTENDED UPTO 31^ST MARCH 2011.IT WILL RESULT IN CHEAPER MOBILE PHONES OF INDIAN COMPANIES e.g.SPICE, MICROMAX,CARBAN MOBILES ETC.

Ø MEDICAL INSTRUMENTS EQUIPMENTS:BCD IS REDUCED TO 4% FROM EXISTING 5% AND WILL BE EXEMPT FROM CVD.

Ø PRECIOUS METALS:

GOLD AND PLATINIUM-CUSTOM DUTY WILL BE INCREASED TO RS.300/10GMS.FROM EXISTING RS.200/10GMS.

SILVER- CUSTOM DUTY WILL BE INCREASED TO RS.1500/1KG.FROM EXISTING RS.1000/1KG.

ON DOMETSICLLY PRODUCED GOLD THE EXCISE DUTY WILL BE AD-VELORUM RS.140/10GMS.FROM EXISTING 2% AND WILL BE EXEMPT FROM SPECIAL ANDITIONAL DUTY OF EXCISE.

Ø LEVY OF CLEAN ENERGY CESS ON COAL ,IMPORTED COAL BY 50/TON

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CA kuldeep kothari (own practice) (375 Points)
Replied 26 February 2010

SERVICE TAX

Ø THE RATE OF SERVICE TAX WILL BE REMAIN UNCHANGE (i.e.10%).

Ø SOME MORE SERVICES ARE BOUGHT IN THE AMBIT OF SR. TAXES

Ø TESTING OF SEEDS SERVICE- WILL BE EXEMPT FROM SR.TAX

Ø TRANSPORTATION OF CERELAS,PULSES BY ROAD WILL BE EXEMPT FROM SERVICE TAX

KEEPING THE EXCISE AND SR. TAX RATES AT 10% SEEMS TO BE AN ATTEMPT FOR SMOOTH ROLL OUT OF GST AS IT WILL ABOLISH ALL THE INDIRECT TAX LEVIES AND THERE WILL BE A COMMON RATE.

CA kuldeep kothari (own practice) (375 Points)
Replied 26 February 2010

GENERAL PART OF THE BUDGET

1. THE PROPOSED CHANGES IN DIRECT TAX WILL RESULT IN REVENUE LOSS OF 26000 CR. APPROX BUT WILL BE COMPENSIATED BY INCREASE IN INDIRECT TAX COLLECTION BY 45000 CR, RS.

2. THE FISCAL DEFECIT IS ESTIMATED AT 5.5% OF GDPAND WITH A PROJECTED GDP GROWTH OF 7.5-9% IT SEEMS TO BE OK.

3. THE FDI POLICY WILL BE SIMPLIED TO INCREASE THE FOREIGN INVESTMENT/

4. APPROXIMATELY 46% OF PLANNED EXP. IS ON INFRASTRUCTURE SECTOR

5. THE REVISED FISCAL DEFICIT ESTIMATE FOR FY 09-10 IS 6.9%

6. APPROXIMATELY 41000 CR RS. ALLOCATED FOR NREGA SCHEME

7. CLEAN ENERGY FUND TO BE ESTABLISHED

8. LENDING TARGET FOR AGRICULTURAL SECTOR IS INCREASED TO 3.75LAKH CR. RS.

9. THE REPAYMENT TIME IS TO BE EXTENDED BY 6 MONTHS FOR FARMER LOANS.

10. RBI MAY GIVE BANKING LICENCES TO PRIVATE CO. AND NBFCs. IT WILL INCREASE THE COMPETITION AND WE WILL SEE LOWER BORROWINGS RATES AND BETTER SERVICES.

11. GROSS TAX RECIEPTS EXPECTED TO BE 7.46LAKH CR.RS.

12. GST’S IS EXPECTED ROLL OUT DATE IS 1-4-2011

13. DIRECT TAX CODE IS ALSO EXPECTED TO BE IMPLEMENTED FROM 1-4-2011

14. THE PLANNED EXPENDITURE ON ENERGY SECTOR IS 5130 CR RS DOUBLED FROM LAST TIME.

15. PLANNED OUTLAY FOR NEW AND RENEWABLE ENERGY MINISTRY IS INCREASED BY 61%

16. 19OO CR RS ALLOCATED FOR UNIQUE INDETIFICATION AUTHORITY

VIEWS:-

THIS BUDGET SEEMS TO BE OK IT IS NOT MUCH NEGATIVE AS IT WAS THOUGHT TO BE LIKE ONLY 2% ROLL BACK IN EXCISE, STIMULUS NOT WITHDRAWN AND CHANGE TAXATION SLABS WILL RESULT IN HIGHER DISPOSABLE INCOME THOUGH THERE ARE SOME NEGATIVE POINTS LIKE INCREASE IN MAT, FUEL PRICES BUT OVERALL THIS BUDGET SEEMS TO BE GOOD NOT MUCH DRAMTIC THOUGH. AND THE VIEWS EXPRESSED BY FINANCE MINISTER IN HIS SPEECH SEEMS THAT HE IS KEEN ON ROLL OUT OF GST AND DTC BY APRIL 2011 AND HIS SHARP VIEWS SEEMS TO BE FUTURISTIC AND TOWARDS DEVELOPING INDIA AS THE FASTEST GROWING ECONOMY.

IN LAST WE CAN SAY THAT IT IS GOOD FROM BOTH “AAM AADMI” AND “CORPORATE” PROSPECTIVE.

REGARDS