How does the Union Budget proposed by the finance minister Pranab Mukherjee, turn out to the common man of India ? Would the aam aadmi of India get to see any benefits or will things get expensive for him – we do an initial analysis.
Revision of Personal Tax slabs – The Finance minister has not made significant changes to the income tax slabs. The tax exemption limit has been raised to Rs. 2 lakhs, as against the existing Rs. 1.8 lakhs. This can give you a saving of Rs. 2,060 .
If you are a smoker, shell out more
Excise duty on cigarettes has been raised. Excise hike also on beedi, other tobacco products; This means the tobacco products will be costing more. Cigarette prices will go up.
Invest in stock markets upto Rs. 50,000
The Finance minister has introduced a new scheme called the Rajiv Gandhi equity linked scheme – As per this scheme, new investors with income below Rs 10 lakh, can claim 50% of the amount invested directly as deductions. However this amount is limited to a maximum of Rs 50,000.
Interest on Savings Bank account
As per the new budget, deductions can be claimed on the interest that your earn from your savings bank accounts. A maximum of Rs 10000 p.a. can be claimed for deductions from this rule.
An amount of Rs 5,000 that is spent on preventive health checkup will be available for deduction.
If you trade in the stock markets
If you are trading in the Stock markets, then you can find some small relief. The Securities transaction tax on every delivery trade done in the stock market, has been reduced. The STT has been reduced from 0.125% to 0.1%
Service tax raised to 12%
The service tax has been raised from 10% to 12%. Branded Apparels, eating out in the restaurants, phone services, will see a hike with the increase in service tax. Insurance premiums will cost more for the policyholders.
Prices of Cars and automobiles to shoot up
Duty on large cars has been increased from 22% to 27%. Also excise duty has been hiked to 12%. These hikes will be directly transfered to the buyers of the vehicles and thus will make the cars and automobiles to cost more.
Gold will cost higher
Custom duty on refined gold has been doubled, while the custom duty on standard gold has also gone up to 4% from 2%. Custom duty on non standard gold has risen to 10% from 5%. However the branded jewellery has been exempted from excise duty.