26 February 2010

BUDGET 2010 Highlights

Budget Special Highlights - 2010-2011

Highlights

  • Service tax to result in net revenue gain of Rs 3000 cr
  • Customs duty on silver at Rs 1500/kg
  • Custom duty on gold to be reduced
  • Mobile phones to be cheaper
  • No capital gains tax on conversion of a business entity into Limited Liability Partnership
  • To encourage manufacture of accessories such as battery chargers and hands-free sets, the concessions will be extended the mobile phone sector
  • 5% customs duty on crude petroleum back
  • Peak customs duty unchanged at 10%
  • FM raises central excise duty on all non-petroleum products from 8 to 10 per cent
  • Revenue loss of Rs 26,000 crore on direct tax proposals
  • Stimulus-led excise duty rollback partially reversed
  • FM allows housing projects to complete projects in 5 years instead of 4 years to avail tax break
  • One-time interim relief to housing and real estate sector
  • Businesses up to Rs 60 lakh and professionals up to Rs 15 lakh to be exempted from auditing obligations of their accounts
  • Uproar in Parliament over petrol price rise
  • To levy excise duty of Re 1/litre on petrol
  • New tax rates would offer relief to 60 per cent of tax-payers
  • CET on petroproducts hiked by Re 1
  • Direct tax receipts to fall by Rs 56,000 cr
  • Standard excise rate up from 8 to 10%
  • Large cars, SUVs excise up to 22% from 20%
  • Sops for real estate, housing projects extended by a year
  • Partial roll back the rate reduction in central excise
  • Direct tax scheme to result in revenue loss of Rs 26,000 cr
  • Compliance burden reduced on professionals and entrepreneurs
  • Corporate tax surcharge down from 10 to 7.5%
  • New income tax slabs will bring relief to the middle class
  • Rs 20,000 additional tax break for infra bonds
  • Minimum Alternate Tax hiked to 18%
  • R&D allocation increased 200%
  • To unveil new Saral 2 form for salaried individuals in two pages
  • Deduction of additional 10% for investment on infrastructure bonds
  • Tax slabs: Broadening 1.6 lakh - Nil above 1.6 lakh-up to 5 lakh 10%
  • 5-8 lakh- 20% above 8 lakh- 30%
  • Tax paying interface to be de-cluttered
  • States to be offered assistance to computerise commercial taxes
  • Greater transparency in tax administration targeted
  • Centralized Tax Centre at Bengaluru fully functional
  • Fiscal deficit at 5.5% for FY'11
  • Rolling target for fiscal deficit 4.2%
  • Gross tax receipts at Rs 7.46 lakh cr
  • New symbol for Indian Rupee
  • Tech advisor group under Nandan Nilekani
  • Allocation for development of micro and small scale sector raised from Rs 1,794 cr to Rs 2,400 cr
  • Rs 2,600 cr for Minority Affairs Ministry
  • To create 50 cr skilled workers by 2022
  • Rs 1,900 cr to UID authority allocated
  • First set of UID to be issued by this year
  • Rs 19,484 cr allocated for road development, to build 20 km of highway every day
  • Subsidy for affordable housing extended
  • Skill development programme for textile and garment sector
  • Pvt sector to meet deficit in grain storage
  • 50% increase in women & child development allocation
  • Development of rural infra remains high priority area
  • Power sector allocation doubled to Rs 5130 cr
  • Rs 400 cr corpus for micro-finance scheme
  • National pension scheme allocation increased
  • States to get Rs 3,675 crore for primary education at rural level
  • Rs 400 cr corpus for micro-finance scheme
  • NREGA allocation to Rs 40,100 crore
  • National Social Security fund to be set up for unorganized sector
  • Urban Development allocation to be raised by 75 per cent
  • 20,000 mw of solar power by 2022
  • Rural development allocation to Rs 61,000 cr
  • Indira Awaas Yojana allocation raised in proportion to plain and hill area housing
  • Development of rural infra remains high priority area
  • Social sector spending at Rs 1.38 lakh cr for FY11
  • Rs 500 cr for Clean Ganga Mission
  • Rs 66, 100 cr for rural development in FY10-11
  • Allocation for school education up from Rs 26, 800 crore to Rs 31, 036 cr
  • Rs 22, 300 crore allocated for Health Ministry
  • Coal regulatory authority proposed
  • Rs 300 cr for Rashtriya Krishi Vikas Yojana
  • Bank farm loan target: Rs 3.75 lakh crore
  • Rs 200 cr To Tamil Nadu for textiles
  • Need to take firm view on opening up of the retail sector
  • National clean Energy Fund to be set up
  • Rs 200 crore to Goa as a special golden jubilee package to restore beaches and increase green cover
  • To provide 2% loan subsidy to farmers
  • Extend loan payment by calamity hit farmers
  • Rs 400cr for four-part strategy for agriculture
  • 2% interest subvention for exports extended
  • Additional banking licenses for pvt players
  • 4 pronged strategy for agriculture
  • Rs 16,500 cr capital support for PSU banks
  • Will consider Parikh report on fuel pricing
  • Goods and services tax to be introduced in 2011
  • Fertiliser subsidy to be reduced
  • GDP growth for FY'10 is seen at 7.2 pc
  • Rs 25,000 cr disinvestment target this year
  • India weathered economic crisis well
  • Direct tax code to be implemented from April 1, 2011
  • Gradual phasing out of economic stimulus
  • Pvt investment can sustain 9 pc growth
  • First challenge: Return to GDP growth
  • Manufacturing growth highest in the past 2 years
  • Indian economy is in a far better position today
  • FM is expected to simplify tax laws in 2010
  • Biggest challenge is to make the growth all inclusive
  • Need to strengthen food security
  • Pranab: Indian economy has stood through the test of time
  • Economic growth slows down to 6 pc in Q3
  • Finance Minister presents Budget 2010
  • Pranab Mukherjee presents his 5th Union Budget
  • Finance Minister Pranab Mukherjee reaches Parliament
  • Inflation is forecast to reach 10 percent in coming weeks
  • Government borrowing was forecast to rise by another 2.2 percent
  • Economists forecast India may cut its fiscal deposit to 5.6% of GDP

Taxes

  • More services to be brought under service tax net
  • Service tax to result in net revenue gain of Rs 3000cr
  • Customs duty on gold to be reduced; silver at Rs 1500/kg
  • Uniform concessional duty of 5% on all medical appliances
  • Rationalising of customs on gaming software
  • Custom duty of one of the key component of microwave oven reduced
  • Peak customs duty unchanged at 10%
  • Custom duty for importing of duplication of prints of films revised
  • No capital gains tax on conversion of a business entity into Limited Liability Partnership
  • Businesses up to Rs 60 lakh and professionals up to Rs 15 lakh to be exempted from auditing obligations
  • Nominal duty of 4% electric cars
  • Partial rollback of excise duty on cement, cement products, large cars
  • To levy excise duty of Re 1/litre on petrol
  • R&D Corp Tax break up to 200%
  • Direct tax receipts to fall by Rs 56,000 cr
  • Pilot project for tax grievances extended to 4 cities
  • Direct tax scheme to result in revenue loss of Rs 26,000cr
  • Corporate tax surcharge down from 10 to 7.5%
  • Rs 20,000 additional tax break for infra bonds
  • Corp Min Alternate Tax up from 15 to 18%
  • New tax rates would offer relief to 60 per cent of tax-payers
  • Direct tax slabs: income upto 1.6 lakh = nil, 1.6-5 lakh = 10%, 5-8 lakh = 20%, above 8 lakh = 30%
  • Centralized Tax Centre at Bengaluru fully functional
  • Gross tax receipts Rs 7.46 lakh crore
  • Deferment of goods & service tax negative for corporates in FY10-11
  • Direct tax to be implemented from April 1, 2011
  • Simple tax system with minimum exemptions near completion
  • Indirect taxes will continue to be in focus
  • Excise duty, service tax may go up by 2%

Prices

  • More services to be brought under service tax net
  • Service tax to result in net revenue gain of Rs 3000cr
  • Customs duty on gold to be reduced; silver at Rs 1500/kg
  • Uniform concessional duty of 5% on all medical appliances
  • Rationalising of customs on gaming software
  • Custom duty of one of the key component of microwave oven reduced
  • Peak customs duty unchanged at 10%
  • Custom duty for importing of duplication of prints of films revised
  • No capital gains tax on conversion of a business entity into Limited Liability Partnership
  • Businesses up to Rs 60 lakh and professionals up to Rs 15 lakh to be exempted from auditing obligations
  • Nominal duty of 4% electric cars
  • Partial rollback of excise duty on cement, cement products, large cars
  • To levy excise duty of Re 1/litre on petrol
  • R&D Corp Tax break up to 200%
  • Direct tax receipts to fall by Rs 56,000 cr
  • Pilot project for tax grievances extended to 4 cities
  • Direct tax scheme to result in revenue loss of Rs 26,000cr
  • Corporate tax surcharge down from 10 to 7.5%
  • Rs 20,000 additional tax break for infra bonds
  • Corp Min Alternate Tax up from 15 to 18%
  • New tax rates would offer relief to 60 per cent of tax-payers
  • Direct tax slabs: income upto 1.6 lakh = nil, 1.6-5 lakh = 10%, 5-8 lakh = 20%,
  • above 8 lakh = 30%
  • Centralized Tax Centre at Bengaluru fully functional
  • Gross tax receipts Rs 7.46 lakh crore
  • Deferment of goods & service tax negative for corporates in FY10-11
  • Direct tax to be implemented from April 1, 2011
  • Simple tax system with minimum exemptions near completion
  • Indirect taxes will continue to be in focus
  • Excise duty, service tax may go up by 2%


Posted by Srisai & Ganesh & Jaga & myLu at 8:32 PM 2 comments
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Market gives thumbs up to Budget

FM revises tax slabs

26 Feb 2010, 1220 hrs IST

Giving a relief to the middle class Pranab Mukherjee revised the tax slabs for the next fiscal. Income Tax Ready Reckoner

FM slaps excise duty of Re 1/l on petrol, diesel

26 Feb 2010, 1233 hrs IST
The FM has slapped an excise duty of Re1/l on petrol and diesel. This has led to a ruckus in the parliament.

Middle of road Budget, 6 out of 10: Swaminathan Aiyar

26 Feb 2010, 1324 hrs IST
The ways in which FM has cut the deficit down to 5.5% is expenditure compression, especially non-plan expenditure with only a 6% increase (adjusted for inflation) is hardly anything.

Rise in MAT to impact software firms

26 Feb 2010, 1448 hrs IST
Small and mid-size outsourcing companies function from STPI units and tax benefits under the STPI scheme are getting phased out in 2010-11.


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Market gives thumbs up to Budget


MUMBAI: The market was pleased with Finance Minister’s Budget speech driving equity benchmarks sharply higher in afternoon
Markets
trade.

Speaking in parliament, Pranab Mukjerjee said he had laid down a road map for reducing the country's fiscal deficit, which soared to a 16-year high of 6.9 per cent of economic output.

The shortfall would drop to 5.5 per cent in the next fiscal year to March 2011, and then 4.8 per cent in the following 12 months, though there would be no let up in the left-leaning government's focus on huge social programmes.

The Finance Minister also slapped an excise duty of Re 1 per litre on petrol and diesel. This has led to a ruckus in the parliament as the move would accentuate inflationary situation in the country. Some opposition members walked out of the house in protest.

National Stock Exchange’s Nifty surged 2.28 per cent or 110.75 points to 4970.50from its previous close. The index touched a high of 4992 during the course of the Budget proceedings after opening at a low of 4858.45.

Bombay Stock Exchange’s Sensex was at 16,604.95, higher by 350.75 points or 2.16 per cent. The index rose to a high of 16,669.25 from a low of 16,249.67.

The broader market also participated in the rally. The BSE Midcap Index surged 2.06 per cent and BSE Smallcap Index gained 1.65 per cent.

Sectorwise, the BSE Auto Index advanced 3.99 per cent, followed by BSE Realty which gained 3.71 per cent. BSE Bankex rallied 3.09 per cent and BSE Metal Index rose 2.89 per cent. The BSE IT Index, marginally down 0.25 per cent, was the lone laggard.

Biggest Nifty gainers were Reliance Capital (11.19%), IDFC (7.4%), DLF (7.29%), Tata Motors (5.71%) and Unitech (5.26%).

Tata Power (-4.34%), Ranbaxy Laboratories (-2.6%), HCL Technologies (-1.65%), BPCL (-0.57%) and Infosys Technologies (-0.47%) were trading with losses.

Market breadth on BSE was extremely positive with 1913 advances against 768 declines.

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Sensex cheers Union Budget 2010; auto, metals, banks lead


The benchmark Sensex salutes Union Budget 2010 unveiled by Finance Minister Pranab Mukherjee and rallied over 400 points during the day. Experts say it was a effect of short covering and positive reaction to budget. Technical Analyst, Ashwani Gujral said it’s just a short covering, so those who are long should exit. However, he feels impact of budget is over and the markets will react to the global cues.

Samir Arora of Helios Capital said the markets rallied due to low expectations from the budget. The markets will get back to global cues next week, he says.

The Nifty closed above the 4900 mark but the sell-off and profit booking in ITC on hike in excise, BHEL, Tata Power, TCS, Infosys and ABB erased more than 50% gains from day's high. Even heavyweights came off their day's high on profit booking at higher levels. It seemed that the markets discouted the budget.

Pranab Mukherjee in his second budget announced some positives like gradual reduction in fiscal deficit, cut in surcharge, more allocation for infrastructure development, increase in FY11 divestment target, increase in personal tax slab to Rs 8 lakh etc, which all these pushed the Nifty above 4950 level during the day. However, there were some negatives like hike in excise duties etc.

FM has increased tax slabs for Aam Adami, so that spending will increase. For income upto Rs 1.60 lakh, there will be no tax while there will be 10% tad for income between Rs 1.60 lakh to Rs 5 lakh; 20% tax for income between Rs 5 lakh to Rs 8 lakh and for income above Rs 8 lakh, there will be tax of 30%.

This will result into an increase in the disposable income of individuals and will boost the spending on necessary as well as luxury goods. Homi P Ranina, Tax Expert, says increase in the exemption limits is on expected lines. According to him, a person earning up to Rs 8 lakh will save Rs 54,000 a year by way of taxes.

The 30-share BSE Sensex closed at 16438, up 184 points and the Nifty was at 4922, up 62 points, as per provisional data. The Nifty March Future was trading with 14 points premium.

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Posted by Srisai & Ganesh & Jaga & myLu at 3:47 PM 0 comments
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