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Old 16th March 2012, 19:00   #31
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Default Re: Union Budget 2012 and impact on us

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Originally Posted by Warwithwheels View Post
Not really! Earlier you had to invest 20K out of your pocket to be eligible for the benefit. Under the proposed system, the benefit will automatically accrue to you.
But end result is same, for 1 Lakh 80C... limits too, one has to invest to get the benefit, e.g, if I have the money and fall inbetween 5L to 8L, this years budget and last year's budget has no news for me. Yes one had to invest those 20K but they would have got tax free returns too. And no where I see what is the limit for a famale salaried person, is it now same 2L for all?
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Old 16th March 2012, 19:15   #32
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Default Re: Union Budget 2012 and impact on us

Tis has been a soft budget overall. The hard decisions on petrol/diesel and cutting subsidies will follow later after the Parliament passes the Budget in both houses of Parliament.

There is not much good news for salary earners, car buyers except that SUV's will not be taxed hard for diesel engines!

The rich are smiling including Corporates.

The hero of the Budget is Mr Trivedi the Railway Minister !!

Last edited by nanduchitnis : 16th March 2012 at 19:19.
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Old 16th March 2012, 22:35   #33
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Buddy...I doubt that it will be good news... It could be clear sign that diesel will de-regularized.
I in-fact support the de-regularization of diesel and the privatization of the fuel industry.

I drive 2 diesels and wont find paying the extra money.
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Old 17th March 2012, 21:03   #34
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Thumbs down Total disappointment

Personally, the budget has been a total disappointment. I was expecting a real increase in the IT limit; instead, what we have a peanuts raise. The entire economic / financial system is crying hoarse that the savings rates are going down; but there is absolutely no incentive for home and small savings I have done a quick calculation of my savings over past 3 years, and I see that I am better off paying 10% tax (I am in the lowest tax bracket) and then investing in the capital market direct that going through some ELSS or tax saver bonds, both of which have been giving negative real returns over past 3 years.

Another point of concern is the 20% hike in service tax. A 2% increase in your phone bill will result in at least 2 K increased outgo for me for phone bills alone. Add outgo on car's service bills, insurance (all - health, car insurance, restaurant, etc) Also, it will put pressure on retailers' marging - they will pay higher service tax on rentals; which translates to higher prices.

Edit- silliest of the proposals has been the one to hike the limit on exempt income from savings bank interest to 10,000/-. Will help only the ultra rich who will keep an average yearly balance of 2.5 lakh in savings bank accounts (at 4% interest rates). A slightly better way would have been to hike the limit for exemption from taxation on interest from all bank / post deposits to, say 75,000/-

Last edited by BaCkSeAtDrIVeR : 17th March 2012 at 21:22.
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Old 20th March 2012, 00:36   #35
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Was going through the budget announcements and a few things got my attention.

The FM has capped the Central Subsidies at 2% for this year and intends to bring them down to 1.75% in the next 3 years. Additionally he expects the GDP to grow at 7.6% annually.

Now if we assume that GDP grows at 7.6% for the next 2 years at a steady pace then there are some surprises.

To make things simpler, let's assume the GDP to be currently 100. That makes the current Central Subsidy to be 2. Now if GDP maintains the 7.6% Growth Rate for 2 years, then the GDP after 2 years will be 115.75.

Now what's 1.75% of 115.75 ?
Ans : 2

So in effect the FM is not cutting down on subsidies at all. In fact since the GDP grows, the Subsidies in % will shrink as a result but in monetary terms they are still the same. The FM can say that he achieved his goal 1 year in advance whereas all that happened was that the GDP grew and the subsidies remained the same.

Additionally, since the Govt has said that they will withdraw the Subsidies on Petrol, Diesel and LPG but since the Overall Central Subsidy remains the same, that means Govt will actually increase subsidies on other schemes. The Govt will implement the Food Security Act by then.

Am I the only one that thinks FM is trying to confuse us with statistics and percentages ?
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Old 20th March 2012, 01:56   #36
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Default Re: Union Budget 2012 and impact on us

Hi everybody
A point.
The budget provides for 44000 crores for oil subsidies when diesel subsidies alone are 80000 crores today.Seems a hike in diesel prices is imminent shortly otherwise how is that much subsidy not considered.
41400 crores of extra taxes will all go from our pockets.
His trying to go against the supreme court's order on vodafone is going to hurt future investors.Likewise his trying to collect retrospectively and open past cases will send wrong signals.
GST by august 2012 may be a bit difficult as for that to be implemented a constitutional amendment is needed.Can he swing his coalition partners?Million $ question
Regards
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Old 20th March 2012, 09:55   #37
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Default Re: Union Budget 2012 and impact on us

The bottom line is that the sops are only 10% of the taxation.

Also, the deficit and other figures are all probably cooked up. To paraphrase a well known phrase,“Budgets are like a bikini. What they reveal is suggestive, but what they conceal is vital.” The concealment is mostly in the fine print.
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Old 20th March 2012, 19:29   #38
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Default Re: Union Budget 2012 and impact on us

There is a proposal to reduce deductible premium on life insurance premia from 20% of sum assured to 10%. This will mean finis for the life insurance as an instrument of savings.

Whether we like it or not, for a large proportion of the populace, the life insurance policy is more an instrument of savings than insurance.
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