Budget 2012: Highlights

Hello friends. The 81^st Union Budget coincided with Sachin Tendulkar’s much awaited 100^th century and most headlines referred to the feat before coming to the budget part! Having done the same here, I now come to the Budget! The budget invoked a mixed response and the stock market was down 209 points. The highlights of the budget are given below. I hope the readers find it useful.

Old tax exemption limit (Rs.)	New tax exemption limit (Rs.)	Category
180,000	200,000	Men
190,000	200,000	Women
250,000	250,000	Senior citizens (those above 60 years and below 80 years)
500,000	500,000	Very senior citizens (those above 80 years)

·        Inflation rate of 6.4% expected for 2012-2013.

·        GDP growth for current fiscal estimated at 6.9%.

·        GDP growth rate of 7.6% expected for 2012-2013.

·        34% rise in service tax revenue.

·        51% higher than estimated subsidy bill for 2011-2012.

·        Aim to cut fiscal deficit to 5.1%.

·        With a 20% reduction, the new rate of Securities Transaction Tax (STT) is 0.10%.

·        A divestment target of Rs. 30,000 crores has been set.

·        Service tax to be hiked to 12% from 10%.

·        Health care, education, car parking, transportation and banking is not a part of the service tax net.

·        10% more tax on cigarettes longer than 65mm.

·        No customs duty to be levied on LCD and LED TV panels.

·        Gross tax revenue to rise to 10.6% of GDP in 2012-13 from 10.1 % in the current fiscal.

·        34% increase in allocation from NRHM (the spending would be Rs. 28,280 crore).

·        MNREGA spending to be down 17.5% to Rs. 33,000 crore for 2012-13.

·        Education budget allocation hiked 21.6% to Rs. 25,555 crore and defence budget allocation hiked 17% to Rs 1.93 lakh crore.

·        Debt to be 45.5% of GDP in FY 2012.

·        Overall expenditure to rise 13.1%.

·        New indirect taxes will add Rs. 45,940 crore to the government coffers.

·        The government woulf forego Rs. 4500 crore on direct taxes.

·        Award of highway projects to increase 20% to 8800 kms.

·        Existing customs duty of 5% on liquefied natural gas and coal to be withdrawn.

·        Foreign airlines to be allowed foreign borrowing of up to $1 billion for working capital.

·        Venture capital funds are exempt from tax on all investments.

·        Rs. 1758 crore allocation for UID.

·        18% increase in farm allocation and the new credit target is Rs. 5,75,000 crore.

·        Full exemption on duty for import of lithium ion cells used in electric and hybrid vehicles.

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