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Budget this year - Simplified for you!

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    Budget this year - Simplified for you! Budget this year - Simplified for you! Document Transcript

    • Budget this year: Simplified for you!The main drift of the budget is to improve the growth rate and get it to 9 percent in the near term andto a double digit rate in the medium to longer term. The other two areas of focus are Infrastructuredevelopment especially in Rural India and Improving Governance by shoring up Systems and bringingstricter control on institutions.Gain for Investors: Deduction of 20,000 for investment in infrastructure bonds extended 40,000-croredisinvestment target, though no PSU privatization 5-fold increase in limit on FII investment in corporateinfrastructure bonds from $5 billion to $25 billion.Although Additional income tax at 30% on income distributed by debt funds to person other than anindividual or HUF.Tax slabs remain unchanged, but the FM did increase your take-home by hiking the IT exemption limits -you gain anywhere between Rs 1,030 and Rs 26,780 a year depending on your age and income bracket.Toothpowder, spectacles, bicycles, pens, pencils will now cost more as will cakes and pastries. For thoseplanning to buy a car, theres good news and bad. If you want to save money and feel youre doing yourbit for the planet, buy a hybrid car, which should get cheaper thanks to customs and excise cuts.Below are some key points of the budget - ● TAX SOPS OF Rs. 20,000 FOR INVESTMENT IN INFRA BONDS ● 15% TAX ON DIVIDEND RECEIVED FROM FOREIGN SUBSIDIARY ● MAT TO BE LEVIED ON DEVELOPERS OF SEZ AS WELL FROM FY12 ● TAX EXEMPTION FOR PEOPLE ABOVE 80 YRS HIKED TO Rs. 5 LAKH ● SURCHARGE ON DOMESTIC COMPANIES CUT TO 5% FROM 7.5% ● MAT RATE HIKED TO 18.5% VS 18% ● PLANNING A NEW TAX CATEGORY FOR VERY SENIOR CITIZENS ● TAX EXEMPTION FOR GENERAL CATEGORY RAISED TO Rs. 1.8 LAKH ● REVENUE DEFICIT SEEN AT 1.8% IN FY12 ● REVENUE DEFICIT SEEN AT 2.3% IN FY11 ● FY12 FISCAL DEFICIT SEEN AT 4.6% OF GDP ● FY11 FISCAL DEFICIT TARGET REVISED TO 5.1% ● PLANNED EXPENDITURE UP 18.3% (YOY) AT Rs. 14.41 LAKH CR ● NET TAX RECEIPTS FOR FY12 SEEN AT Rs. 6.64 LAKH CR ● GROSS TAX RECEIPTS FOR FY12 SEEN AT Rs. 9.32 LAKH CR ● NON TAX REVENUE FOR FY12 SEEN AT Rs. 1.25 LAKH CR ● TOTAL EXPENDITURE UP 13.4% AT Rs. 12.57 LAKH CR ● ALLOCATED Rs. 69199 CR FOR DEFENCE CAPEX IN FY12 ● Rs. 8000 CRORE FOR NORTHEAST INDIA ● Rs. 8000 CRORE FOR DEVELOPMENT NEEDS OF JAMMU & KASHMIR ● OLD AGE PENSION FOR PEOPLE OVER 80 YRS HIKED TO Rs. 500/MONTH
    • ● NATIONAL MISSION ON HYBRID VEHICLES TO BE STARTED● PROPOSE Rs. 5000 CR FOR TAKEOUT FINANCING SCHEME● PROPOSE A 5 FOLD STRATEGY TO DEAL WITH BLACK MONEY● TO EXTEND INFRA TAX BREAKS FOR THE FERTILISER SECTOR● CLOSE TO FINALISING NATIONAL FOOD SECURITY BILL● PLAN Rs. 1.6 LAKH CR SPENDING FOR SOCIAL SECTOR PROJECTS● TO BRING BROADBAND CONNECTIVITY TO ALL VILLAGES● ALLOCATION FOR BHARAT NIRMAN RAISED TO Rs. 58000 CR● NREGA WAGE RATE INDEXED TO CONSUMER PRICE INDEX● SCHEDULED TRIBES ALLOCATION RAISED TO Rs. 2.44 LAKH CR● ALLOCATION FOR EDUCATION RAISED TO Rs. 52057 CR● PLANNED ALLOCATION FOR HEALTHCARE UP 20% TO Rs. 27,600 CR● IIFCLS FY12 DISBURSEMENT TARGET AT Rs. 25,000 CR● SPEND ON INFRA SECTOR TO BE HIKED BY 23%● GOVT AGENCIES CAN RAISE Rs. 30,000 CR FROM TAX FREE BONDS● COLD STORAGE TO BE BOUGHT UNDER AMBIT OF INFRA SECTOR● FURTHER SUBVENTION OF 3% FOR REPAYING FARM LOANS ON TIME● INTEREST SUBVENTION FOR FARM LOANS AT 7% TO CONTINUE● FII LIMIT IN INFRA SECTOR CORP BONDS RAISED TO $25 BN● TO SIMPLIFY SERVICE TAX REFUND PROCESS● MFG SHARE IN GDP TO RISE TO 25% OVER NEXT 10 YEARS● TO SET UP 15 MORE MEGA FOOD PARKS● RBI TO BRING OUT GUIDELINES ON NEW BANKING LICENCES● Rs. 6000 CR TO ENABLE BANKS TO MAINTAIN 8% TIER 1 CAPITAL● TO MOVE INSURANCE, PENSION AND BANKING BILLS IN PARLIAMENT● TO INFUSE Rs. 500 CR IN REGIONAL RURAL BANKS● ROLLOUT OF DTC TO BE EFFECTIVE FROM APRIL 1, 2012● TO SET UP INDIA MICROFINANCE EQUITY FUND WITH Rs. 100 CR● PROPOSE TO GIVE Rs. 3000 CR TO NABARD● TO GIVE Rs. 5000 CR TO SIDBI TO REFINANCE SMALL FIRMS● LIBERALISE INTEREST SUBVENTION OF HOME LOAN UP TO Rs. 15 LAKH● TO ENHANCE FUNDS UNDER RURAL HOUSING FUND TO Rs. 30,000 CR● MORTGAGE RISK GUARANTEE FUND FOR HOME LOANS TO POOR● HAVE HIKED PRIORITY HOME LOAN LIMIT TO Rs. 25 LAKH● TO GIVE PSU BANKS Rs. 20157 CR TO RAISE TIER 1 CAPITAL● NEW COMPANIES BILL TO BE INTRODUCED IN THE CURRENT SESSION● MINORITIES LOAN TARGET UP AT 15% OF PRIORITY LOANS● ALLOCATION FOR FARM DEVELOPMENT HIKED TO Rs. 7860 CR● DISCUSSIONS ON TO FURTHER LIBERALISE THE FDI POLICY● GOVT TO MAINTAIN MOMENTUM OF DIVESTMENT● GOVT TO MOVE TOWARD DIRECT SUBSIDY TO PEOPLE LIVING BPL● DIRECT CASH SUBSIDY ON KEROSENE, FERTILISERS FOR BPL● EXTENDING NBS TO COVER UREA UNDER CONSIDERATION
    • ●● PREPARATION EXACT CLASSIFICATION OFSTAGES MUST REVISIT OF GST ROLLOUT IN FINAL EXPENDITURE● TO INTRODUCE GST BILL AMENDMENTS IN THIS SESSION● AIM FOR FISCAL DEFICIT OF 3% BY FY14● GST AND DTC REFORMS TO MODERATE RATES AND SIMPLIFY NORMS● PROPOSE INTRODUCING PUBLIC DEBT MGMT OF INDIA BILL● EXPECT RBI MEASURES TO MODERATE INFLATION● EXPECT CURRENT ACCOUNT DEFICIT TO COME DOWN NEXT YEAR● EXPECT INFLATION TO COME DOWN NEXT YEAR● CURRENT ACCOUNT DEFICIT STILL A CONCERN● HUGE PRICE GAP IN WHOLESALE & RETAIL NOT ACCEPTABLE● PRICES OF KEY AGRI COMMODITIES HAVE DECLINED● ECONOMY RESILIENT TO EXTERNAL AND LOCAL SHOCKS● EXPECT AGRI SECTOR TO GROW AT 5.4% IN FY11● GDP ESTIMATED TO GROW 8.6% IN FY11 IN REAL TERMS● SIMPLIFYING TAXATION, TRADE AND TARIFFS PROCEDURES● MUST ADDRESS STRUCTURAL CONCERNS ON INFLATION MGMT● NEED TO FIGHT CORRUPTION ON ALL FRONTS● NEED TO BALANCE SUPPLY AND DEMAND COMPONENTS● NEED TO BALANCE SUPPLY AND DEMAND COMPONENTS● NEED TO TACKLE SUPPLY SIDE ISSUES IN AGRICULTURE● REVIVAL IN PRIVATE INVESTMENT SHOULD BE SUSTAINABLE● FOOD INFLATION REMAINS A CONCERN● GOVERNANCE PRACTICE REMAINS A PRIORITY● PRIORITIES REMAIN GROWTH, PUBLIC DELIVERY● FY11 FISCAL CONSOLIDATION IMPRESSIVE● SERVICE GROWING IN DOUBLE DIGITS● INDUSTRY REGAINING ITS MOMENTUM● PRANAB MUKHERJEE PRESENTS THE UNION BUDGET 2011● GOVT SHOULD TAKE MEASURES TO PROMOTE FDI IN ALL SECTORS● SOME AMOUNT OF LIQUIDITY INFUSION IS POSSIBLE● REDUCING FISCAL, INFRA DEFICIT CRUCIAL● MEASURES TO CONTAIN INFLATION ARE VERY CRUCIAL● EXPECT MEASURES FOR FINANCIAL SAVINGS● EXPECT VOLATILITY ON FII FLOWS TO CONTINUE● COMMITTED TO PROVIDING CHEAPER COOKING FUEL● NEED TO PLUG PDS SLIPPAGES TO EXPAND COVERAGE● INITIALLY LICENCES SHOULD BE GIVEN TO NBFCS, MFIS● GIVE TWO KINDS OF BANK LICENCES● EXPECT VOLATLITY ON FII FLOWS TO CONTINUE● SLOWDOWN IN FDI PARTLY OFFSET BY FII FLOWS● BUREAUCRACY IMPEDING FDI FLOWS● STRONG GROWTH IN EXPORTS AT 29.5% FOR APRIL-DECEMBER
    • ● DEVELOPMENTS IN MID-EAST, EUROPE NEED TO BE WATCHED● URGENT NEED TO EXPAND STORAGE SPACE, FACILITIES● NEED TO REVIEW GRAIN RELEASE● FAVOURS SMART CARDS FOR KEROSENE, FERTILISER SUBSIDY● SMART CARD, COUPON TO HELP TARGET FOOD SUBSIDIES BETTER● BETTER SUBSIDY TARGETING FOR BETTER FISCAL MGMT● ANTI-INFLATIONARY STANCE WARRANTED● FOOD PRICES, DEMAND PRESSURE TO SHAPE INFLATION OUTLOOK● RISE IN PURCHASING POWER LEADING TO INFLATION UPTREND● SIGNS OF FOOD, FUEL PRICE INCREASES SPILLING OVER● SHARP RISE IN FOOD PRICES A CAUSE OF CONCERN● EXPENDITURE GROWS AT 11.2% FOR FIRST NINE MONTHS● REVENUE RECEIPTS GREW BY 50% FOR FIRST NINE MONTHS● NON TAX REVENUES GREW BY 136.4% FOR FIRST NINE MONTHS● GROSS TAX REVENUES GREW BY 26.8% FOR FIRST NINE MONTHS● NEED EXPENDITURE REFORMS TO REACH PROJECTED DEFICIT● PROSPECT OF REVENUE LED FISCAL CONSOLIDATION● FY11 REV DEFICIT EXPECTED TO BE AT 3.5% OF GDP● FY11 FISC DEFICIT EXPECTED TO BE AT 4.8% OF GDP● EFFICIENT TAXATION BY A NEW GST● IMPROVING NREGA BY FOCUSSING ON PERMANENT ASSET● SECOND GREEN REVOLUTION IN AGRI● NEED TO STREAMLINE LAND ACQUISITION, ENV CLEARANCES● PRIVATE SECTOR PARTICIPATION IN SOCIAL SECTORS● PLAN TO INCREASE DIESEL PRICES IN A STAGGERED MANNER● GOVT TO CAP AUTO FUEL PRICES IF CRUDE OIL SPURTS● CURRENT ACCOUNT GAP TO MODERATE ON HIGHER EXPORTS● FY11 FISCAL GAP SEEN AT 4.8% ON HIGHER GDP BASE● INFLATION TO MODERATE ON FISCAL, MONETARY STEPS● INFLATION REMAINS A DARK CLOUD FOR THE ECONOMY● ECONOMY TO GROW BY 8.75% - 9.25% IN FY12● GOVT TO CAP AUTO FUEL PRICES IF CRUDE OIL SPURTS● PLAN TO INCREASE DIESEL PRICES IN STAGGERED MANNER● COMMITTED TO COOKING FUEL AT AFFORDABLE PRICE● FAVOURS SMART CARDS ALSO FOR KEROSENE, FERTILISER SUBSIDY● NEED TO PLUG PDS SLIPPAGES TO EXPAND IMPROVE COVERAGE● SMART CARD, COUPONS TO HELP TARGET FOOD SUBSIDY BETTER● ECONOMY TO GROW AT 8.75%-9.25% FOR FY’12● FY’11 REVENUE GAP SEEN 3.8% OF GDP● PROSPECTS OF REVENUE-LED FISCAL CONSOLIDATION● BETTER SUBSIDY TARGETING IMPROVING FISCAL MANAGEMENT● BUREAUCRACY IMPEDING FDI INFLOWS● NEED PERSISTENT ANTI-INFLATION MONETARY STANCE
    • ●● INFLATION SIGNIFICANTLY ABOVE COMFORT LEVEL NEED TO BE VIGILANT AGAINST DEMAND SIDE PRESSURES● LIQUIDITY MGMT MAJOR CHALLENGE FOR RBI● DIRECT TAX CODE PROPOSED TO BE LAUNCHED APRIL 2012● FY’11 FISCAL GAP SEEN 4.8% ON HIGHER GDP BASE For any help, Contact Fullerton Securities. Call Now: 39400800