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Live – Union Budget 2013 – Highlights

Union Finance Minister Sri P Chidambaram has proposed the much awaited Union Budget today in the Parliament. The minister described that the budget spurs higher growth with an inclusive development in the country.

P Chidambaram at the parliament to present the Union budget 2013

Highlights

FM announces his plans to set up an all-women’s bank via public sector. It will be a women bank, by women, for women.  Govt.  will provide Rs 1,000 crore initial capital to this all-women’s bank.

1000 Crore fund to be setup for Nirbhaya fund – for the safety of women & girls.

Tax Proposals

Income Tax

  • Personal income tax – No change in the slabs or tax rates.  Exemptions and slabs have been retained intact.
  • Only for the first slab (of income between Rs.2 Lakhs to Rs. 5 Lakhs) – a tax credit of Rs. 2000/-  will be given.
  • Medical expenses under the CGHS eligible for deduction under the Section 80 D.
  • Transactions on immovable properties – TDS at 1% on value of transaction where the deal exceeds Rs. 50 lakhs.

Other taxes

  • STT (Security Transaction Tax) reduced from 0.017 to 0.01%.  For Mutual Funds redemption it has been reduced from 0.25 to 0.001%.  For the MF purchases, it has been reduced from 0.1 to 0.001% on the seller.
  • Commodity Transaction Tax (CTT) introduced on non-agricultural contracts at 0.01% on trades.
Indirect Taxes

No major change in customs and excise duties.

Increase duty on high end motor vehicles to 100% . Motor bikes with engine capacity of 800cc or more will have to pay more from 60% to 75%.

Duty on machinery of Leather and leather goods  to be reduced.  Export duty on rice barn oil withdrawn.

Import duty on Set top boxes increased.  Raw silk import duty increased.

 

Investment & Capital Market 

  • 12th plan has 1 trillion USD 55 lakh crores for infrastrucrture.  45% to be shared by the Private sector.  Infrastructure Debt Funds to be encouraged.  IIFCL to offer credit enhancements.
  • Investment allowance – Companies investing 100 crores or more during 2013-2015 will be entitled for 15%  deduction as Investment allowance.
  • SEBI to simplify procedures for Foreign Institutional Investors
  • FIIs allowed to operate in currency derivative segment.
  • SMEs will be permitted to list in SME exchange without an IPO.
  • Stock exchanges will introduce a dedicated debt segment.
  • 800 Crores allotted for Wind energy

Sectoral allocations

  • FM worried about Current Account Deficit – High volume of coal imports, gold imports and slow down contribute to this. 75 billion USD required for the current account deficit.
  • Plan estimation at Rs. 14,30,825 for the 12th five year plan.
  • FM states that Inflation is a worry.  Food inflation is the major worry for the government.
  • Rs. 41,516 crores allocated for the Scheduled caste upliftment.
  • Health ministry gets a major boost in allocation.
  • 17% increase in allocation for the Education sector.
  • JNNURM – urban  development mission – continues in the 12th plan also – A sum of 14,873 crores allocated
  • 22% more allocation for the Agriculture ministry.
  • Over 6000 Crores for the Science & Technlogy and over 5000 crores for the space ministry
  • Aligarh Muslim university, Banaras unversity, Tata institue at guwahati, INTAC – each get 100 crore allotments
  • National institute of Sports coaching to be set up at Patiala.
  • Private FM services will be extended to 294 cities.
  • Post offices to offer core banking units with Real time banking services. 532 crores allotted.

 

 

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