No change in IT slabs; thrust on women, youth & poor in union budget

GOANEWS DESK, PANAJI | 28 February 2013 14:58 IST

No changes in income tax slab except for the super rich and thrust on women, youth and poor are the highlights of the union budget presented by union finance minister P Chidambaram in the Parliament today.

In fact the minister announced special Nirbhaya Fund of Rs 1000 crore to empower women and keep them safe and secure.

The budget also announced setting up of India’s first Women’s Bank as a public sector bank.

Similarly, the finance minister has announced Rs 1000 crore for skill development of 10 lakh youth to enhance their employability and productivity.

Following are few major highlights of the union budget 2013: CLICK HERE FOR ALL HIGHLIGHTS

INCOME TAX & LOANS           

-          No changes in existing Income Tax slabs

-          No case to revise either the slabs or the rates of Personal Income Tax. Even a moderate increase in the threshold exemption will put hundreds of thousands of Tax Payers outside Tax Net

-           However, relief for Tax Payers in the first bracket of `2 lakhs to ` 5 lakhs. A tax credit of ` 2000 to every person with total income up to `5 lakhs

-          A surcharge of 10 per cent on persons (other than companies) whose taxable income exceeds Rs.1 crore has been levied

-          First home loan from a bank or housing finance corporation up to Rs. 25 lakh entitled to additional deduction of interest up to Rs. 1 lakh.

DIRECT TAXES

-          Surcharge of 10 per cent on persons (other than companies) whose taxable income exceed ` 1 crore to augment revenues

-          Increase surcharge from 5 to 10 per cent on domestic companies whose taxable income exceed ` 10 crore

-          In case of foreign companies who pay a higher rate of corporate tax, surcharge to increase from 2 to 5 per cent, if the taxable income exceeds ` 10 crore

-          In all other cases such as dividend distribution tax or tax on distributed income, current surcharge increased from 5 to 10 per cent

-          Additional surcharges to be in force for only one year

-          Education cess to continue at 3 per cent

-          Permissible premium rate increased from 10 per cent to 15 per cent of the sum assured by relaxing eligibility conditions of life insurance policies for persons suffering from disability and certain ailments

-          Contributions made to schemes of Central and State Governments similar to Central Government Health Scheme, eligible for section 80D of the Income tax Act

-          Donations made to National Children Fund eligible for 100 per cent deduction.

INDIRECT TAXES

-          No change in the normal rates of 12 per cent for excise duty and service tax

Customs

-          Duty on specified machinery for manufacture of leather and leather goods including footwear reduced from 7.5 to 5 per cent.

-          Duty on pre-forms precious and semi-precious stones reduced from 10 to 2 per cent

-          Duty on Set Top Boxes increased from 5 to10 per cent

-          Duty free gold limit increased to ` 50,000 in case of male passenger and `1,00,000 in case of a female passenger subject to conditions.

Excise duty

-          Handmade carpets and textile floor coverings of coir and jute totally exempted from excise duty

-          To provide relief to ship building industry, ships and vessels exempted from excise duty. No CVD on imported ships and vessels

-          Specific excise duty on cigarettes increased by about 18 per cent. Similar increase on cigars, cheroots and cigarillos

-          Excise duty on SUVs increased from 27 to 30 per cent. Not applicable for SUVs registered as taxies.

-          Duty on mobile phones priced at more than `2000 raised to 6 per cent

Service Tax

-          Proposals to levy Service Tax on all air conditioned restaurant.

-          For homes and flats with a carpet area of 2,000 sq.ft. or more or of a value of `1 crore or more, which are high-end constructions, where the component of services is greater, rate of abatement reduced from 75 to 70 per cent

SECTORAL ALLOCATION

-          Substantial rise in allocation to the social sector. Allocation for Rural Development Ministry raised by 46 per cent to Rs. 80,194 crore

-          The target for farm credit for 2013-14 has been set at Rs. 7,00,000 crore against Rs. 5,75,000 crore during the current year

-          Rs. 10,000 crore earmarked for National Food Security towards the incremental cost.

-          Education gets Rs. 65,867 crore, an increase of 17 per cent over RE for 2012-13

-          ICDS gets Rs. 17,700 crore. This is 11.7 per cent more than the current year

-          Drinking water and sanitation will receive Rs. 15,260 crore. Rs. 1,400 crore is being provided for setting up water purification plants to cover arsenic and fluoride affected rural areas

-          Health and Family Welfare Ministry has been allotted Rs. 37,330 crore. National Health Mission will get Rs. 21,239 crore which represents 24.3 per cent over the RE

-          The Jawaharlal Nehru National Urban Renewal Mission (JNNURM) will receive Rs. 14,873 crore as against RE of Rs. 7,383 crore in the current year

-          Defence has been allocated Rs. 2,03,672 crore

-          Rs. 3,511 crore have been earmarked to Minority Affairs Ministry, 60 per cent higher than RE for 2012-13

THE BUDGET                                                 

-          Plan Expenditure placed at Rs. 5,55,322 crore. It is 33.3 per cent of the total expenditure while Non Plan Expenditure is estimated at Rs. 11,09,975 crore. The plan expenditure in 2013-14 will be 29.4 per cent more than the RE of the current year i.e. 2012-13.

-          Fiscal Deficit for 2013-14 is pegged at 4.8 per cent of GDP. The Revenue Deficit will be 3.3 per cent for the same period

-          Direct Benefit Transfer (DBT) Scheme to be rolled out throughout the country during the term of UPA Government

-          The Government will encourage Infrastructure Debt Fund (IDF) and allow some institutions to raise tax free bonds up to Rs. 50,000 crore which is 100 per cent more than the current year

-          India Infrastructure Finance Corporation (IIFC), in partnership with ADB will help infrastructure companies to access bond market to tap long term funds

-          Income limit under Rajiv Gandhi Equity Savings Scheme (RGESS) will be raised from Rs. 10 lakh to Rs. 12 lakh

-          Proposal to launch Inflation Indexed Bonds or Inflation Indexed National Security Certificates to protect savings from inflation

-          On oil and gas exploration policy, the Budget proposes to move from the present profit sharing mechanism to revenue sharing. Natural gas pricing policy will be reviewed

-          On coal, the Budget proposes adoption of a policy of pooled pricing

-          Benefits or preferences enjoyed by MSME to continue up to three years after they grow out of this category

-          Refinancing capacity of SIDBI raised to Rs. 10,000 crore

-          Technology Upgradation Fund Scheme (TUFS) for textile to continue in 12th Plan with an investment target of Rs. 1,51,000 crore

-          Rs. 14,000 crore will be provided to public sector banks for capital infusion in 2013-14

-          A grant of Rs. 100 crore each has been made to 4 institutions of excellence including Aligarh Muslim University, Banaras Hindu University, Tata Institute of Social Sciences, Guwahati and Indian National Trust for Art and Cultural Heritage (INTACH)

-          ‘Voluntary Compliance Encouragement Scheme’ launched for recovering service tax dues

-          Rs. 9,000 crore earmarked as the first instalment of balance of CST compensations to different States/UTs

 


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