BUDGET HIGHLIGHTS-2012-13 D.T 16/03/2012
Following are some of the key highlights of the Union Budget 2012-13, presented by Finance Minister Pranab Mukherjee in the Parliament on Friday 16thMarch, 2012
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GENERAL CHANGES ARE AS UNDER
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GDP growth to be 7.6 per cent during 2012-13.
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Subsidy expenditure to be checked and higher tax revenues targeted.
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Rs.30,000 crore to be raised from disinvestment.
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To allow qualified foreign investors in Indian corporate debt market.
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To allow external commercial borrowing (ECB) to finance working capital needs of airlines for 1 year.
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To allow external commercial borrowing for power, housing, road and construction companies.
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To allow qualified FII into domestic corporate bonds
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Withholding Tax on ECB borrowings reduced from 20% to 5% for power, airlines, roads, bridges, affordable houses & fertilizer sectors.
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Allocation of Rs.15,890/- crores for recapitalization of PSU banks
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MAJOR CHANGES IN THE AREA OF DIRECT TAXATION ARE AS UNDER:-
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Implementation of Direct Tax Code has been deferred.
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Basic exemption limit for individual has been increased from 1.80 lakh to 2.00 lakh.
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Increased the limit to Rs.10 lakh under 20% tax slab from Rs.8 lakh
i.e Individual will have to pay 10% tax on income between Rs.2 lakh and 5 lakh;20% between Rs.5 lakh and Rs.10 lakh;and 30% for above Rs.10 lakh.
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Exemption upto Rs.10,000/- of Interest from saving bank accounts.
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Introduction of New Equity Scheme called Rajiv Gandhi Equity Saving Scheme under which 50% tax deduction for whose annual income is below 10 lakh and who invest upto Rs.50,000/- in equity market subject to 3 year lock in.
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Turnover limit for compulsory tax audit for SMEs raised from 60 lakh to 1 crores.
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Senior citizen to be exempt from advance tax payment.
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No change in Corporate Tax rates.
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Reduction in STT rates from existing 0.125% on delivery based turnover in the cash segment to 0.10%.
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MAJOR CHANGES IN THE AREA OF INDIRECT TAXATION ARE AS UNDER:-
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GST to be operational by August 2012.
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Rate of service tax has been increased from 10% to 12%.
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School education exempt from service tax.
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Some Infra Construction services exempt from service tax.
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All services to attract service tax except those 17 services in the negative list.
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Common tax code for service tax and excise.
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Standard Excise duty raised to 12% from 10%.
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Branded Silver Jewellery fully exempt from excise duty.
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12% excise duty imposed on branded retail garments.
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Custom duty on gold increased to 4% from 2%.
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Import of Aircraft parts exempt from basic custom duty.
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Mobile phone parts exempted from basic custom duty.
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LCD and LED panels exempted from custom duty.
SUMMARY OF BUDGET 2012
The Budget 2012 has been lacklustre. It focused on domestic demand driven growth recovery; create condition for rapid revival of high growth in private investment; address
supply bottlenecks in agriculture, energy and transport sectors particularly in coal,power,national highways, railways and civil aviation. It has not showered much additional benefits to the individual assessee.
Thanking You,
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