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Expectation from the union b
udget 2011-2012\par
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With respect to the real estate sector, The government should cut down the inter
est by another 1% for loan under 10 lac. So that the real estate sector can get
a boost and the common man could also dream about owning a house.\par
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With respect to the simplification of taxation in the Real Estate sector.\par
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Introduction of Goods and Services Tax (GST) and inclusion of the Real Estate se
ctor under the ambit of this single tax regime,will simplify transaction costs (
which currently include stamp duty) and give developers a set-off or credit on t
he taxes paid on construction material and services. \par
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Also, create a nation-wide, unified taxation system, which currently differs bet
ween states\par
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Expectation for Retail Sector\par
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More relaxations for FDI in retail\par
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Providing 100% FDI in multi-brand retailing, would ensure substantial growth in
the food processing and textile sectors via the resultant linkage effects of a m
odernized, globalized retail trade. The employment generation for Indian youth w
ould be enormous, and Indian retail will benefit from market-savvy internationa
l retail corporations, and would learn to adopt their best management practices.
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Expectation with respect to tax break\par
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Indian Finance minister Pranab Mukherji has hinted that the raising inflation ha
s given a big stroke to the common populace and for this reason an Income tax re
bate will be given to the populace of India. In the next budget session in April
2011, the finance ministry is said to raise the income tax exemption limit to R
s 2 lakhs, under the direct taxes code which implies to 2012-2013 tax payers.\pa
r
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Expectation with respect to vat deduction\par
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Indian home minister P Chidambaram has received a letter from Sonia Gandhi, to f
ind out ways to lower the vat tax on fuel and basic commodities, which will give
some relief to the over burdened populace of India. It is a fact that Indian co
nsumers are paying Rs 4 as VAT for each liter of petrol, they are using.\par
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So, if the government slashes the VAT to around 50% on basic goods and fuel, the
n the Indian populace can take a sigh of relief in this financial year of 2011-2
012.\par
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Expectation with respect to IT Industry is concerned\par
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The Profit linked method may be changed to Investment Linked Tax Incentive metho
ds for the Software companies. \par
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Expectation with respect life insurance industry\par
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Life Insurance industry is expecting separate limit of Rs.50,000/-for the life i
nsurance premium, apart from the deduction u/s 80C of Rs.1 lac and Rs.20,000/- f
or Infrastructure bonds. \par
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Availability of separate tax exemption for life Insurance premium will boost the
Life insurance industry, as the tax payers will look at it as a tax savings dev
ice.\par
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This will ensure better insurance penetration in the country. Currently, the to
tal tax savings such as PPF, Life insurance premiums, PF contributions, National
Savings Certificates etc are covered under Rs.1 lakh limit u/s 80C of the Incom
e tax Act.\par
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Life Insurance Industry is expecting some clarity about the applicability of Min
imum Alternate Tax (MAT) for the Life insurance Companies. \par
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Expectations with respect to infrastructure\par
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Another expectation will be on increasing the funds towards infrastructure. The
increase in infrastructure would be around 20 percent of last years expenditure
in roads, airports, railways which was around $38 billion dollars. This expected
20% increase would benefit not just the transports which also includes health a
nd education which is exactly our primary concern. \par
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Expectation with respect to tax holidays\par
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Tax benefits related to export sector will not be the same as last year. As expo
rt sectors like software industry involved in exporting of computer and accesso
ries are allowed Tax holiday on their profits. This will expire after the end of
the financial year. we may expect this will be extended(1 year) to support outs
ourcing.\par
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Expectation from farming community\par
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The much touted National Rural Guarantee Scheme has played havoc with Farmers. E
asy jobs with a guaranteed salary from the NREG have made big numbers of farm la
bor to migrate away from the hard work and low pay of agriculture work. This has
resulted in a very acute shortage of workers and is seen as a major cause for t
he rise in prices of farm products. Even a good monsoon has not brought any chee
r to the farmer as he does not have labourers to harvest his crop! The farming c
ommunity is expecting the FM to scrap this populist scheme or ensure that migrat
ion of farm labourers is plugged.\par
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Expectations from student community\par
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The student community expects that the FM will declare a loan waiver for Educati
onal Loans.\par
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On that note most common Indians expect the FM to bring about a sea change in th
e Education system (indirectly of course) as School Fees and College fees have s
tarted rocketing skywards for no Rhyme or Reason. The common perception is that
easy availability of educational loans has tempted colleges to demand higher fee
s as they are sure that the parents will anyway find a way to pay!\par
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Expectation with respect to Fuel price Deregulation.\par
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Last year, the UPA government deregulated the petrol prices in a bid to shrink
the country\rquote s fiscal deficit and help oil marketing companies to cut loss
es on selling fuel at subsidized rates.\par
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How about setting free of diesel price controls now? While petrol prices are now
market-determined subject to periodic revision, it is diesel which constitutes
a lion\rquote s share of fuel subsidy bills driven by demand for fuel and indust
rial purposes. Currently, government resorts to ad-hoc hike in diesel prices but
has slowed down even on that as inflation pressures have worsened recently.\par
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Expectation with respect to spending social sector.\par
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Last year, government earned sizeable one-time revenues from sale of premium 3G
airwaves to the extent of around Rs. 1.1 lakh crore and large disinvestment pro
ceeds from stake sale of PSU companies. Both these revenue-drivers might have ac
cumulated approximately Rs.1.5 crore in the exchequer\rquote s kitty.\par
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Formally, the entire disinvestment proceeds are to be channelled into the Nation
al Investment Fund (NIF) and then utilized for capital expenditure in social sec
tor schemes and revive ailing state-owned entities. Thus, this year, most of the
se funds should be up for utilization for grass-root social development programs
in areas such as primary health, primary education, law and order, family welfa
re, and so on.\par
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Expectation with respect to cut on Excise and Service Tax\par
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Last year, FM had raised the excise duty to 10% on non-oil products as a part of
the efforts to withdraw stimulus and create sources of funds to bring down the
extent of fiscal deficit situation.\par
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With spiraling inflation and high commodity costs, the corporate India has reque
sted Pranab Mukherjee to cap the excise duty and service tax at previous year le
vels. Industry chamber Assocham has also urged FM to reduce corporate tax to 25%
from the current 30% to maintain current levels of investment and growth prospe
cts.\par
}