UNION BUDGET- MY ANALYSIS

 

Well it’s a mere coincidence that Union Budget and Academy Awards (Oscars) were
announced on the same day. King’s speech swapped the show by claiming all the major
awards like – Best Movie, Best Actor and Best Original Screenplay.

Well let’s shift our focus from King’s Speech – The Movie to King of Finance – Pranab
Da’s speech.

Well there were lots of expectations from this Budget. Prakash Somani Sir has mentioned
few of them in his article - MY EXPECTATION FROM BUDGET.

Friends I am neither an economist nor a financial analyst. I am a student and will mention
what I have understood as a layman/common man.

 (A)   Inflation

Who can forget the onion/food prices last year!!

The main reason of inflation given by him was the gap b/w wholesale &
retail price. Conditions have improved this January from last year but still
it is a major issue and a matter of prime concern. Govt. is taking measures
especially to control food prices and expects it to fall next year- I will say
WIP (Work-in-progress)

 (B)     LOANS/MONETARY/AGRICULTURE
 Budget proposes to raise housing loan limit from20 lakh to25 lakh and
1% reduction in the interest rates on loan upto 15L  – Good move
 Remuneration of Anganwadi Helpers is being raised from1500 to3,000
per month &1,500 from750 – Well I hail from a small city of Western-
Up (Bijnor) and seeing the present system of Anganwaadi in my city
don’t consider it as a very wise move. Absenteeism and corruption are
the major highlights of Anganwadi and first a proper system s’d be
developed to check the discrepancies of the same otherwise our hard
earned money is gonna waste in such schemes- thumbs down from me  
 Capital Investment in Fertilizer it to be treated as Investment. 3%
Interest subsidy to farmers -  thumbs UP
 Pension Age (BPL cards) reduced from 65years to 60 years and for 80+
age pension increased from200 pm to 500 pm -  GOOD MOVE BUT
STRICT VIGILANCE IS REQUIRED IN DISTRIBUTION OF AMOUNT

 Direct tax/indirect tax/i-tax return/TAX SAVINGS

 Direct Tax Code will be implemented from April, 2012 and the Goods
and Services Tax Bill is to be introduced in Parliament this year  –
Expected
 Exemption limit for the general category of individual taxpayers
enhanced from Rs. 1,60,000 to Rs. 1,80,000 giving uniform tax relief
of Rs. 2,060- BELOW EXPECTATIONS
 A New category of V.Senior citizen created for people of 80+ age and a
exemption limit of500000 will be provided to them – NOT USEFUL FOR
MIDDLE/ LOWER CLASS
 Qualifying age reduced for senior citizens from 65 years to 60 years -
thumbs UP
 No change in tax slab for Woman Assessee - DISSAPOINTED
 The standard rate of central exercise duty will be maintained at 10%. A
1% central excise duty on 130 items entering the tax net and there will
be no change in CENVAT rates -  A MOVE TO STAY ON COURSE FOR
TRANSITION TO GST
 Tax on all services provided by hospitals with 25 or more beds with
facility of central air conditioning- BLUNDER. JUST TELL ME ANY ICU
WITHOUT AN AC FACILITY. A big blow on lower middle class people
 Hotel accommodation in excess of ` 1,000 per day and service provided
by air conditioned restaurants that have license to serve liquor added as
new services for levying Service Tax- NECESSARY MOVE TO COVER UP
THE LOSS FROM DIRECT TAXES.
 A new simplified form ‘Sugam’ to be introduced to reduce the compliance
burden of small tax payers- APPRECIABLE MOVE
 Tax free bonds of Rs. 30,000 Crore proposed to be issued by
Government undertakings during 2011-12 – Expected
 Salaried employee having no other source of income is exempted from
filing the return– TOTAL WASTE. JUST TELL ME THAT IS THERE ANY
SALARIED PERSON WITHOUT ANY F.D. OR A SAVING A/C?? IF NO, THEN
INTEREST INCOME WILL COME UNDER INCOME FROM OTHER
SOURCES AND HE WILL BE REQUIRED TO FILE THE RETURN. 

(D) OTHER IMPORTANT ANNOUNCEMENTS

 Cash subsidy will be provided to people below poverty line for
Kerosine,Fertilizers & LPG – BRILLIANT MOVE BUT DEPENDS A LOT ON
APPLICATION
 FII investment through Mutual Funds – CRUCIAL FOR INDIAN
ECONOMY
 5 Point Strategy to deal with Black Money -  no expectation from this
system kyunki chor khazane ki raksha nahin kara karte
 Disvestment without Privitisation – TIMID DECISION
 Scholarship scheme for SC/ST students studying in classes IX and X-
JUST ONE QUESTION. WHY ONLY FOR SC/ST STUDENTS????
 Mobile, Laser Printer, Steel, Cement & LED will be cheaper and Brander
clothes, branded Gold, Air Travel, Medical check-up will become
costlier-  NO COMMENTS

CONCLUSION
Well half of the Union Budget focused on Infrastructure. It is a
good budget for Industry. But FM has missed an opportunity. The
reason for the same is it can’t be called as “Aam Aadmi ka Budget”.

Friends this is totally my own write-up and took me whole day to

finalize the points. It is quite different from my usual category i.e.
Inspirational. I have tried my level best to keep the matter simple
but effective. Your comments and suggestions for improvement are
most welcome.

 Regards
Tarun Gupta