Domestic air travel to cost Rs 50 more , international travel to increase by Rs 250 for service tax

- Domestic air travel to cost Rs 50 more , international travel to increase by Rs 250 for service tax

- Propose to raise service tax on air travel:

Basic Exemption limit for women reamins unchanged

Not very good budget, its average one..dint get as expected..

Corporate surcharge got reduced to 5%

slab got increased 1.6 lak to 1.8 for men

Senior citizen now 60years and slab increased to 2.5 lak

Housing loan amout increased to 25lak

5 lak exemption to new category for seniro citizen 80 years above..

servicet tax and excise duty both unchanged..

10% excise on branded garments.

Air travel costlier

30,000 cr tax free infrastructer bonds..

Average inflation will be lower in 2012.

Finance minister Pranab Mukherjee on Monday presented to Parliament India's budget for the coming financial year beginning in April.

Following are the highlights of the budget:

TAXES
* Standard rate of excise duty held at 10 percent; no change in CENVAT rates
* Personal income tax exemption limit raised to Rs 180,000 from Rs 160,000 for individual tax payers
*For senior citizens, the qualifying age reduced to 60 years and exemption limit raised to Rs 2.50 lakh.
*Citizens over 80 years to have exemption limit of Rs 5 lakh.
* To reduce surcharge on domestic companies to 5 percent from 7.5 percent.
* A new revised income tax return form 'Sugam' to be introduced for small tax papers.
* To raise minimum alternate tax to 18.5 percent from 18 percent
* Direct tax proposals to cause 115 billion rupees in revenue loss
* Service tax rate kept at 10 percent
* Customs and excise proposals to result in net revenue gain of 73 billion rupees
* Iron ore export duty raised to 20 percent
*Nominal one per cent central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery will be exempted.
*Peak rate of customs duty maintained at 10 per cent in view of the global economic situation.
*Basic customs duty on agricultural machinery reduced to 4.5 per cent from 5 per cent.
*Service tax widened to cover hotel accommodation above Rs 1,000 per day, A/C restaurants serving liquor, some category of hospitals, diagnostic tests.
*Service tax on air travel increased by Rs 50 for domestic travel and Rs 250 for international travel in economy class. On higher classes, it will be ten per cent flat.
* Revenue gain of Rs.11,000 crore from increase in indirect taxes.
* Electronic filing of TDS returns at source stabilised; simplified forms to be introduced for small taxpayers.
* Works of art exempt from customs when imported for exhibition in state-run institutions; this now extended to private institutions.

FISCAL DEFICIT
* Fiscal deficit seen at 5.1 percent of GDP in 2010-11
* Fiscal deficit seen at 4.6 percent of GDP in 2011-12
* Fiscal deficit seen at 3.5 percent of GDP in 2013-14

SPENDING
* Total expenditure in 2011-12 seen at 12.58 trillion rupees
* Plan expenditure seen at 4.41 trillion rupees in 2011-12, up 18.3 percent

REVENUE
* Gross tax receipts seen at 9.32 trillion rupees in 2011-12
* Non-tax revenue seen at 1.25 trillion rupees in 2011-12

GROWTH, INFLATION EXPECTATIONS
* Economy expected to grow at 9 percent in 2012, plus or minus 0.25 percent
* Inflation seen lower in the financial year 2011-12 

DISINVESTMENT
* Disinvestment in 2011-12 seen at 400 billion rupees
* Government committed to retaining 51 percent stake in public sector enterprises.
* FDI policy being liberalised.

BORROWING
* Net market borrowing for 2011-12 seen at 3.43 trillion rupees, down from 3.45 trillion rupees in 2010-11

POLICY REFORMS
* To create infrastructure debt funds
* To boost infrastructure development with tax-free bonds of 300 billion rupees
* Food security bill to be introduced this year
* To permit SEBI registered mutual funds to access subscripttions from foreign investments
* Raised foreign institutional investor limit in 5-year corporate bonds for investment in infrastructure by $20 billion
* Setting up independent debt management office; Public debt bill to be introduced in parliament soon
* Bills on insurance, pension funds, banking to be introduced.

SECTOR SPENDING
* To allocate more than 1.64 trillion rupees to defence sector in 2011-12
* Corpus of rural infrastructure development fund raised to 180 billion rupees in 2011-12
* To provide 201.5 billion rupees capital infusion in state-run banks in 2011-12
* To allocate 520.5 billion rupees for the education sector
* To raise health sector allocation to 267.6 billion rupees

AGRICULTURE
* Removal of supply bottlenecks in the food sector will be in focus in 2011-12
* Agriculture growth key to development: Green Revolution waiting to happen in eastern region.
* To raise target of credit flow to agriculture sector to 4.75 trillion rupees
* Gives 3 percent interest subsidy to farmers in 2011-12
* Cold storage chains to be given infrastructure status
* Capitalisation of National Bank for Agriculture and Rural Development (NABARD) of 30 billion rupees in a phased manner
* To provide 3 billion rupees for 60,000 hectares under palm oil plantation
* Actively considering new fertiliser policy for urea
* Food storage capacity to be augmented - 15 more mega food parks to be set up in 2011-12; of 30 sanctioned in previous fiscal, 15 set up.
* Comprehensive policy on further developing PPP (public-private-partnership) model.
* Farmers need access to affordable credit.
* Moving to improve nutritional security.
* Necessary to accelerate production of fodder.

ON THE STATE OF THE ECONOMY
* "Fiscal consolidation has been impressive. This year has also seen significant progress in those critical institutional reforms that will pave the way for double digit growth in the near future."
* "At times the biggest reforms are not the ones that make headlines, but the ones concerned with details of governance which affect the everyday life of aam aadmi (common man). In preparing this year's budget, I have been deeply conscious of this fact."
* Food inflation remains a concern
* Current account deficit situation poses some concern
* Must ensure that private investment is sustained
* "The economy has shown remarkable resilience."
* Setting tone for newer, vibrant economy.
* Economy back to pre-crisis trajectory.
* Development needs to be more inclusive.

ON GOVERNANCE
* "Certain events in the past few months may have created an impression of drift in governance and a gap in public accountability ... such an impression is misplaced."
* Corruption is a problem, must fight it collectively

• AC restaurants serving liquor and AC hospitals with more than 25 beds under service tax.
• Service tax on air travel to be increased.
• Customs duty on raw silk reduced from 30 to 5 per cent.
• Legal services to be expanded to business entities.
• 20% export duty for iron ore.
• Custom duty on Pet Coke and Gypsum to minimized to 2.5%.
• No new tax exemption limit for women.
• Mandatory levy of 10 pct on branded garments.
• Budget estimates for 2011-12 projects- Rs 9,32,440 crore.
• No change in Central excise duty rate. Base rate on excise duty raised from 4% to 5%.
• Surcharge rate reduced from 7.5 percent to 5 percent for domestic companies.
• Hike in exemption IT limit from Rs 1.6 lakh to Rs 1.8 lakh.
• New series of coins with new rupee symbol expected.
• Simplify tax collection procedure.
• 1 million UID cards to be distributed per day shortly.
• Targeting to reduce deficit to 4.6% for the upcoming fiscal year.
• Plan and Non-Plan expenditure to be increased by 23%.
• BPL pension eligibility age limit reduced.
• Group formed to monitor corruption;will start implementing from 62 dept. in first phase.
• Amendment of Indian Stamp Act shortly.
• Simplified form 'Sugam' for small tax payers.
• Rs 1.64 lakh crore for Defence.
•  

is there anything about DTC and IFRS

• Rs 1000 crore to build judicial infrastructure.
• Group of ministers to sort out Environmental concerns.
• 1000 crore for improvising judiciary system.
• Rs 8,000 cr to Northeast.
• 60 schemes for SC/ST to be implemented.
• Rs 100 crore for Ladakh.
• Rs 150 crore for Jammu.
• Pension amount increased for 80 years and above.
• Indira Gandhi National Old Age Pension Scheme eligibility revised from 65 to 60 years.
• Rs 200 cr grant to IIT Kharagpur.
• Rs 20 crore to IIM Calcutta.
• 50 Crore to muslim universities in different states.
• 58,000 crore for Bharat Nirman Schemes: FM
• State Innovation Council in each state to be set up.
• Remuneration of anganwadi workers increased from Rs 1500 to Rs 3,000 per month.
• Independent debt management office to be established.
• Rs 1.6 lakh crore to be spent on social projects.
• Current a/c gap a concern due to composition of FX flows: FM
• Establishment of national policy on psychotic drugs, narcotics.
• Tax free infra bonds worth Rs 30000 cr for PSBs proposed.
• 15 mega food parks to be set up.
• Infrastructure spending increased by 23%.
• Rs 30K crore tax free bonds to be provided for railways.
• Financial assistance to be provide to Bengaluru, Chennai, Kolkata metro projects.
• Allocation under Rashtriya Krishi Vikas Yojana to be increased to Rs 7860 crore.
• Promote organic farming.
• GDP manufacturing, targeting 16-25 % increase in next 10 years.
• Rs 300 cr to cultivate pulses in rain-fed areas;Rs 300 cr for the promotion of farm product cultivation.
• Provide Rs 6000cr for PSU bank recapitalization.
• FM: Micro finance companies to be provided with Rs 100 crore equity funds.
• Extension of NBS for urea to be analyzed.
• Home loan limit increased.
• Rs 300 cr for improving pulses production.
• Rural infrastructure development fund to be raised to 180 billion Rupees for the coming fiscal year.
• Grant 1% interest on home loans upto 50 lakhs.
• Mortage Risk Guarantee fund for rural housing to be set up.
• Rs 5,000 cr to be provided to SIDBI to meet priority lending targets.
• Rs 2000 crore for warehousing facilities.
• Rs 2,000 cr for manufacturing facilities.
• Allocation of Rs 6000 cr for some PSU banks.
• Only registered FII's to be associated with Indian MF industry.
• Rs 40,000cr to be raised via disinvestment.
• GST bill to be introduced in current session.
• Extension of NBS to cover urea under review: FM
• 500 crore proposed for empowering women.
• Micro finance institutes proposed for 100 crore.
• 300 crore to be provided to NABARD.
• FBI to regularize banking amendments.
• Ensures better delivery of urea, kerosene.
• FII allow to trade amongst themselves.
• FBI policy to be regularized.
• Public Debt Management Bill to be introduced in 2012.
• Pranab sees Budget 2011-12 as transition towards a transparent and result-oriented economic management.
• Public sector undertaking to be increased.
• Direct transfer of cash subsidy to downtrodden.
• Average inflation and current account deficit to be minimized by next year: FM
• Strong proposition to fight against corruption.
• Pranab seeking Lord Indra's blessings to get good monsoon.
• Remarkable record for last fiscal year.
• Improvise the governance.
• Govt. to reconsider ecological concerns.
• Tremendous growth in exports-29.4%.
• Food inflation down from 22.2% to 9.3 %. But still is a major concern, says FM.
• Budget to ensure more transparent economy.
• Focus on supply side issues in agriculture.
• Pranab: Work on food inflation.
• Stabilize the macro economic situation.
• Budget 2011 approved by Cabinet.
• Pranab: Impressive fiscal consolidation
• Pranab Mukherjee begins the speech.
• Finance Minister Pranab Mukherjee to begin Union budget 2011-12 speech from 11 am.

MAT increased from 18% to 18.50%...

Plus points of the budget:-

Increase in exemption limit in tax slabs.

Cash subsidies for keronsene n fertilizers.

Increasing imporatnce for warhehouses would enable to reduce increase in prices for agricultural produce.

Rs.17000 Crs of food grains bringing to Private sector.

Roadmap for GST n DTC.

Focus on agriculture, literacy mission.
.

Minus points:

Service tax on hospitals having 25 beds or more .

Branded garments becomes costlier.

Increase in Air fare.

1)     Some legal services to be brought under service tax net. Service by an individual to another individual exempted.

2)     Service tax on air travel increased by Rs 50 for domestic travel and Rs 250 for international travel in economy class. On higher classes, it will be 10% flat

3)     Service tax widened to cover hotel accommodation above Rs 1,000 per day, A/C restaurants serving liquor, some category of hospitals, diagnostic tests.

4)     Tax reductions to result in revenue loss of Rs 11,500 crore.

5)     Tax slabs for women remain unchanged

6)     Union Budget 2011 widens scope of service tax

7)     Revenue deficit fixed at 2.3% in revised estimates of 2010-11 and 1.8% in 2011-12:FM

8)     Nominal 1% central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery will be exempted

9)     No change in CENVAT rates.

10)  Standard rate of central exercise duty maintained at 10%: FM

11)  Revenue deficit fixed at 2.3% in revised estimates of 2010-11 and 1.8% in 2011-12

              Budget estimates for 2011-12 projects Rs 9,32,440 crore - an increase of 24 per cent: FM

               Minimum alternate tax raised from 18% to 18.5% of book profits

              Extension of investment on long-term infrastructure bonds by one more year

12)  Budget proposes no change in service tax.

13)  Expenditure in 2011-12 estimated at Rs 12,57,729 crore, an increase of 13.4%

               Budget to maintain standard rate of excise duty at 10%.

14)  Income tax exemption limit raised, but no changes in slabs

               Senior citizen age reduced from 65 to 60

               Senior citizen concession extended to Rs 2.5 lakh, to above 80 to Rs 5 lakhs

               Budget proposes to enhance tax limit for general public from Rs 1, 60,000 to Rs 1,80,000

15)  Fiscal deficit brought down to 5.1%.

16)  Rs 9 lakh compensation to be given to men of defence and central paramilitary forces for permanent disability and discharged from service

              Rs 1.64 lakh crore for defence; more will be given if required:

17)  GoM constituted to tackle corruption

18)  Mahatma Gandhi National Rural Employment Guarantee Scheme wage rates linked to consumer price index; will rise from existing Rs 100 per day.

19)  Allocation to health sector raised by 20%.

20)  Old age pension to persons of over the age of 80 raised from Rs 200 to Rs 500.

21)  Rs 50 crore grant to Aligarh Muslim University centres in Murshidabad in West Bengal and Malappuram in Kerala.

22)  Remuneration of anganwadi workers raised from Rs 1500 to Rs 3,000 per month. Helpers to get Rs 1,500 from Rs 750.

23)  Union Budget 2011 proposes 24% increase in education sector allocation

               100% salary hike for Anganwadi teachers in Union Budget.

24)   Rs 100 crore for IIT Kharagpur.

25)  Union Budget 2011 allocates Rs 58000 crore for social schemes.

26)  Education stocks Aptech, NIIT, Everonn, Edserv up 3-5% on budget proposals.

27)  Fertiliser sector investment to get infrastructure status.

28)   A new scheme to be introduced for refund of service tax on lines of drawback of duties.

29)   Proposal to introduce self-assessment of customs duty wherein importers and exporters will themselves      assess payment of duty.

30)  Measures to be taken to bring back black money.

31)  Food storage capacity to be augmented - 15 more mega food parks to be set up in 2011-12; of 30 sanctioned in previous fiscal, 15 set up.

32)  Bills on insurance, pension funds, banking to be introduced.

33)  Union Budget 2011 proposes 17% increase in social sector expenditure.

34)  Rupee up on increase in FII corp bond limit.

35)  To boost infrastructure development,  proposes tax-free bonds of 300 billion rupees.

36)  Infrastructure spending to be raised by 23%.

37)  Existing interest subvention scheme on short term farm loans at 7 % interest to continue.

38)  Credit flows to farmers raised from Rs 3.75 lakh crore to Rs 4.75 lakh crores.

39)  Allocation under Rashtriya Krishi Vikas Yojana to be raised from Rs 6755 crore in the current year to Rs 7860 crore.

40)  Rs 300 cr provided to promote pulses cultivation in rain-fed areas, another Rs 300 cr to promote farm product cultivation.

41)  RBI to issue new guidelines for banking sector.

42)  Housing loan limit for priority sector lending raised to Rs 25 lakh.

43)  FIIs can invest $40 billion in corporate bonds.

44)  Farmers to get 3% rebate on loan if payment is regular.

45)  Proposal to increase rural housing fund to Rs 3,000 crore

              Proposes to give Rs 3000 crore to NABARD.

46)  Portfolio investment would be permitted in SEBI registered mutual funds from foreign subscripttions.

47)  Seeks Lord Indra's blessings for good monsoon J

48)  GST constitutional amendment bill to be introduced

49)  FY12 disinvestment target at Rs 40000 crore

50)  Women self-help group development fund created.

51)  Cash transfer of subsidy on kerosene, LPG, fertiliser to BPL people.

52)  Direct tax code to be implemented from April 1, 2012

53)  Corruption is a problem, must fight it collectively.

54)  Industry has grown by 8.1%.

55)  Services have grown by 9.6%

56)  Economy expected to grow by 9% next year

57)  Agriculture has grown by 5.4%

58)  GDP growth at 8.6%

59)  Total food inflaction declined to less than 9 percent in January.

SOURCE :  TIMES OF INDIA...

10%excise on garment branded clothes

Direct Tax amendments