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Old 28th February 2011, 16:56   #1
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Thumbs down Union Budget Highlights 2011 - 2012

hey guys...
here are the highlights for the union budget 2011 - 2012

Positives:

1) Surcharge for companies cut to 5% from 7.5%.

2) Very senior citizens over 80 years of age to have exemption limit of Rs 5 lakhs.

3) Special incentives for hybrid vehicle makers if manufactured in india.

4) Duty reduced on hybrid & electric cars along with batteries imported for such vehicles.

5) Senior citizens age limit reduced from 65 years to 60 years for income tax purposes.

6) Basic customs duty on agricultural machinery reduced to 4.5% from 5%.

7) Direct investment in mutual funds by any foreigner.

8) Tax exemption limit for senior citizens raised Rs 2.5 lakh from Rs 2.4 lakh.

9) Basic food, fuel, precious stones, gold and silver jewellery to be exempted from central excise duty.

10) Nominal 1% central excise duty on 130 items entering the tax net.

11) LED to cost less.

12) Domestic surcharge reduced to 5%.

13) Service tax rate 10% unchanged.


Negatives:

1) A/c restaurants serving liquor to come under service tax net.

2) Health check-ups in private hospitals to become more expensive.

3) International air travel and domestic air travel to become more expensive.

4) Tax on life insurance service providers could be negative for insurance companies.

5) Travel, healthcare to become expensive due to increased service tax.

6) Lack of FDI in retail.

7) New service tax to hurt companies in hospitality.

8) Hike in export duty on iron ore.

9) Branded clothes will cost more.

10) Rise in MAT from 18% to 18.5%.

11) Divestment but no privatisation.
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Old 28th February 2011, 17:01   #2
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Default Re: Union Budget Highlights 2011 - 2012

But why the thumbs down in your title?
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Old 28th February 2011, 17:02   #3
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Default Re: Union Budget Highlights 2011 - 2012

Moderator's Note: Guys, lets keep it to the budget only and keep politics out of it please. Thanks
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Old 28th February 2011, 17:15   #4
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Default Re: Union Budget Highlights 2011 - 2012

Quote:
Originally Posted by kausu View Post
11) LED to cost less.
Ok. So now Audi would be a bit cheaper

On a serious note looking at the above points don't see any major impact to Car or Bike Manufacturers (other than the hybrid ones). I Admit that i still need to go into all the details.

Last edited by amitwlele : 28th February 2011 at 17:19.
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Old 28th February 2011, 17:16   #5
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Default Re: Union Budget Highlights 2011 - 2012

I remember reading on Rediff that car prices will remain the same or will become a bit cheaper. Correct?
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Old 28th February 2011, 17:18   #6
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Default Re: Union Budget Highlights 2011 - 2012

Anyone has any direct figures on fate of electronic items? I see the LEDs would cost less, so may be the LED TVs may cost less, but any idea on Home theatres? This is lame, but I am planning to buy one and would time my buy as per the prevalant pricnig conditons!
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Old 28th February 2011, 17:18   #7
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Default Re: Union Budget Highlights 2011 - 2012

Thumbs down probably because there are no tax relaxations IMO this is a neither here nor there kind of a budget. It doesn't put much money in the hands of the consumer nor adresses core issues of subsidies to rein in the deficit.
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Old 28th February 2011, 17:23   #8
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Thumbs down

A thumbs down from my side. I do not find anything good for salaried folks. The increase in exemption limit from 1.6 lac to 1.8 Lac would save me 2k. Having said that, I might end up paying much more than that in service taxes at Restaurants serving alcohol, Hotels rooms costing more than 1k, hospitals/diagnostic centers etc.

The only thing I liked is the FM's proposal to exempt salaried class from filing tax returns unless they have other sources of income. Much needed respite from the "saral" form, which actually is an oxymoron.

Quote:
Originally Posted by jkdas View Post
I remember reading on Rediff that car prices will remain the same or will become a bit cheaper. Correct?
jkdas: you are correct, in that car prices will remain unchanged with the Budget keeping the excise duty on automobiles intact. Hybrid & electric cars would now cost much lesser too.

Last edited by mobike008 : 28th February 2011 at 17:51. Reason: Back to back posts. Please wait for 20 Mins before next post or use EDIT button to make changes.
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Old 28th February 2011, 17:31   #9
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Default Re: Union Budget Highlights 2011 - 2012

Any word about construction material prices like steel and cement ?
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Old 28th February 2011, 17:38   #10
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Default Re: Union Budget Highlights 2011 - 2012

Quote:
Originally Posted by jkdas View Post
I remember reading on Rediff that car prices will remain the same or will become a bit cheaper. Correct?
Could be, as steel will be cheaper.
Also, Hybrid cars will be cheaper

Thanks
Rajesh

Last edited by RajeshK : 28th February 2011 at 17:39.
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Old 28th February 2011, 17:50   #11
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No filing of tax returns if salary is only income!

In a big relief from cumbersome tax filing process for the salaried class, finance minister Pranab Mukherjee on Monday proposed to exempt them from filing tax returns unless they have other sources of income.

The government will be issuing a notification exempting 'classes of persons' from the requirement of furnishing income tax returns, said the Memorandum to the Finance Bill 2011.

The decision, which will come into effect from June 1, 2011, will reduce the compliance burden on small taxpayers, it added.

Salaried taxpayers who do not have other sources of income and whose incomes are subject to Tax Deduction at Source (TDS) will be excluded from filing returns.

"Therefore, in cases where there is no other source of income, filing of a return is duplication of existing information," the Memorandum said.

Every person whose income exceeds the taxable limit is required to file return of income.

Source

Petrol, diesel prices may rise after FM fails to reduce duty!


Petrol and diesel prices look set to be hiked after finance minister Pranab Mukherjee ignored calls for its reduction in customs and excise duty to contain the impact of spurt in global crude oil prices that have touched a two year high of $110 per barrel.

Mukherjee in his Budget for 2011-12 left customs duty on crude oil unchanged at 5% and that on petrol and diesel untouched at 7.5%. Excise duty on petrol will remain at Rs 14.35 a litre and diesel at Rs 4.60 per litre.

In fact, he refrained from mentioning the impact of rising crude oil prices on an economy which is 75% dependent on imported oil to meet its energy needs.

State-owned IOC, BPCL and HPCL are currently losing about Rs 2.25 a litre on petrol, a fuel that was freed from government control in June last year. Oil firms had withheld raising petrol prices in anticipation of a cut in customs and excise duty in the Budget for 2011-12.

Similarly, the oil firms currently sell diesel at Rs 10.74 per litre lower than imported cost and in absence of a duty cut, an increase in prices is the only option left to meet rise in cost of raw material (crude oil).

Oil Minister S Jaipal Reddy had last week stated he would take the case for an auto fuel price hike to an Empowered Group of Ministers (EGoM) headed by Mukherjee after the Budget.

The timing of the hike remains to be seen as the government may be jittery of raising prices when Parliament is in session.

The Budget session of parliament goes for a 3-4 week break from March 18 and rates may be hiked then.

Besides petrol and diesel, the oil firms lose Rs 21.60 a litre on PDS kerosene and Rs 356.07 per 14.2-kg domestic LPG cylinder.

The only other way to avoid a fuel price hike would have been higher government subsidy. But Mukherjee has provisioned only Rs 23,640 crore in 2011-12 as oil subsidy, lower than Rs 38,386 crore of current fiscal.

The budgetary provision for the purpose during 2011-12 will be less than one-fourth of the projected Rs 1,05,000 crore revenue loss that state oil firms anticipate on selling diesel, domestic LPG and kerosene next fiscal.

The revenue loss projected for 2011-12 fiscal is higher than Rs 1,03,292 crore under-recovery in 2008-09 when global crude oil prices had touched USD 147 per barrel.

Of this, the government provided Rs 71,292 crore in cash and to contain impact also lowered customs duty on crude to zero and that on products to 2.5%.

At current prices, the oil firms are projected to lose Rs 76,559 crore in the current fiscal, half of which is to come from government by way of cash compensation. Further, one- third would be contributed by upstream firms like ONGC and the remaining absorbed by oil marketing firms.

Source

Last edited by Pri2 : 28th February 2011 at 18:13. Reason: update
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Old 28th February 2011, 18:23   #12
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Default Re: Union Budget Highlights 2011 - 2012

Quote:
Originally Posted by wildon View Post
Any word about construction material prices like steel and cement ?
Cement prices are bound to increase. In fact as per the news on ET companies have already intimated the stockists to increase the price from March 1st.

Source:
Union Budget 2011: Cement makers likely to hike prices - The Economic Times
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Old 28th February 2011, 18:45   #13
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Default Re: Union Budget Highlights 2011 - 2012

Quote:
Originally Posted by Pri2 View Post
No filing of tax returns if salary is only income!

In a big relief from cumbersome tax filing process for the salaried class, finance minister Pranab Mukherjee on Monday proposed to exempt them from filing tax returns unless they have other sources of income.
But the point is that most of the middle class, salaried employees do invest worth Rs 1 lakh to save on income tax. Hence they still will have to file ITR to get the refund of whatever investments they have done?

Am I right?

Regards
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Old 28th February 2011, 19:11   #14
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Default Re: Union Budget Highlights 2011 - 2012

Quote:
Originally Posted by deky View Post
But the point is that most of the middle class, salaried employees do invest worth Rs 1 lakh to save on income tax. Hence they still will have to file ITR to get the refund of whatever investments they have done?

Am I right?

Regards
Declaring and filing tax returns are two different things. You will still have to declare, but not file returns unless you have invested in something later on after declaring.

Note: I am no financial / tax guru, this is my basic understanding about the new policy and I may be wrong.
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Old 28th February 2011, 20:14   #15
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Default Re: Union Budget Highlights 2011 - 2012

Quote:
Originally Posted by deky View Post
But the point is that most of the middle class, salaried employees do invest worth Rs 1 lakh to save on income tax. Hence they still will have to file ITR to get the refund of whatever investments they have done?

Am I right?

Regards
As far as i am concerned, I can submit my investment details before 31 Dec of FY. The tax wont be cut. Also, its all TDS. So ultimately, no need to file returns.
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