BUDGET HIGHLIGHTS 2011-12

inance Minister Pranab Mukherjee presented the Union Budget 2010-11 in parliament on Monday.

Has he lived up to the expectations of the taxpayers? Is it a populist Budget? Will it also help India to grow? To find out read on.. Highlights. . .

Direct Taxes

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Exemption limit for the general category of individual taxpayers enhanced fromRs 1,60,000 to Rs 1,80,000 giving uniform tax relief of Rs 2,000. Exemption limit enhanced and qualifying age reduced for senior citizens. Exemption limit for Very Senior Citizens, who are 80 years raised to Rs 500,000. Current surcharge of 7.5 per cent on domestic companies proposed to be reduce to 5 per cent. Rate of Minimum Alternative Tax proposed to be increased from 18 per cent to18.5 per cent of book profits. Tax incentives extended to attract foreign funds for financing of infrastructure. Additional deduction of Rs 20,000 for investment in long-term infrastructure bonds proposed to be extended for one more year. Lower rate of 15 per cent tax on dividends received by an Indian company from its foreign subsidiary. Benefit of investment linked deduction extended to businesses engaged in the production of fertilisers. Investment linked deduction to businesses developing affordable housing. Weighted deduction on payments made to National Laboratories, Universities and Institutes of Technology to be enhanced to 200 per cent. System of collection of information from foreign tax jurisdictions to be strengthened. A net revenue loss of Rs 11,500 crore (Rs 115 billion) estimated as a result of proposals. Indirect Taxes To stay on course for transition to GST. Central Excise Duty to be maintained at standard rate of 10 per cent. Reduction in number of exemptions in Central Excise rate structure. Nominal Central Excise Duty of 1 per cent imposed on 130 items entering in the tax net. Lower rate of Central Excise Duty enhanced from 4 per cent to 5 per cent. Optional levy on branded garments or made up proposed to be converted into a mandatory levy at unified rate of 10 per cent. Peak rate of Custom Duty held at its current level.13 To distribute 1 million UID cards per day shortly

* To provide Rs 200 cr grant to IIT Kharagpur, Rs 20 crore to IIM Calcutta * Allocation of Rs 52,057 cr for education sector, increase of 24% * Broadband Internet for rural India * Direct tax code to be effective April 1, 2012 * Indian economy expected to grow at 9% in FY12 * Discussions on to further liberalise FDI policy

* Inflation remains a concern, to fall next year * Plan to introduce Companies Bill in current session * Must ensure that private investment is sustained * Need to ensure balanced demand and supply * Disinvestment target of Rs 40,000 cr * Growth rate of services sector expected at 9.3% * To provide Rs 58,000 crore for Bharat Nirman projects * Special Economic Zones to come under MAT * Service tax retained at 10% * Base rate on excise duty raised to 5% from 4%