Indian Union Budget 2012 -2013
The Union budget has just been declared. The Union Budget 2012-13 speech made by the Finance Minister Pranab Mukherjee saw a number of changes being announced across the sectors of the economy. At the very beginning of his speech Mr Mukherjee said that a "year of recovery interrupted" meant that it was time to take tough decisions. The idea ahead of the budget was that fiscal deficit needed to be controlled by cutting subsidies and raising taxes. The finance minister has raised taxes and promised cuts in subsidies. Here are the highlights of the Budget.
Amendment to the FRBM Act proposed as part of Finance Bill. New concepts of “Effective Revenue Deficit” and “Medium Term Expenditure Framework” introduced
Central subsidies to be kept under 2 per cent of GDP; to be further brought down to 1.75 per cent of GDP over the next 3 years.
Proposed: Mobile based fertilizer management system; LPG transparency portal; scaling up and rolling out of Aadhar enabled payment for government schemes in at least 50 districts.
Rs. 30,000 crore to be raised through disinvestment
Efforts to reach broadbased consensus on FDI in multi-brand retail
Rajiv Gandhi Equity Saving Scheme: to allow income tax deduction to retail investors on investing in equities
Rs. 15,888 crore to be provided for capitalization of public sector banks and financial institutions
A central “Know Your Customer” depository to be developed
Swabhimaan: remaining habitations to be covered; to be extended to more habitations; ultra small branches to be set up in Swabhimaan habitations
Investment in 12th Plan in infrastructure to go uptoRs. 50,00,000 crore; half of this is expected from private sector
Tax Free Bonds of Rs. 60,000 crore to be allowed for financial infrastructure projects
Allocation of Road Transport and Highways Ministry enhanced by 14 per cent to Rs. 25,360 crore
Financial package of Rs. 3,884 crore for waiver of loans to handloom weavers and their cooperative societies; mega handloom clusters in Andhra, Jharkhand; weaver service centres in Mizoram, Nagaland and Jharkhand ; powerloom mega cluster in Maharashtra; Rs. 500 crore pilot schemes for geo-textiles in North-Eastern region
Rs. 5,000 crore India Opportunities Venture Fund to help small enterprises
Allocation to agriculture enhanced; RKVY gets Rs. 9,217 crore; BGREI gets Rs. 1,000 crore; Rs.2242 crore project to improve dairy productivity; Rs. 500 crore for coastal aquaculture
Various other agricultural activities merged into 5 missions
Target for agricultural credit raised to Rs. 5,75,000 crore
Interest subvention for short-term crop loans to farmers at 7 per cent interest continues; additional 3 per cent for prompt paying farmers
Rs. 200 crore for awards to incentivise agricultural research
Provisions under rural housing fund increased to Rs. 4,000 crore from Rs. 3,000 crore
Interest subvention of 1 percent on housing loans uptoRs. 15 lakh extended for one more year
AIBP allocation raised by 13 per cent to Rs. 14,242 crore
National Mission on Food Processing to be started in cooperation with State Governments
Scheduled Caste Sub Plan allocation increases by 18 per cent to Rs. 37,113 crore; Tribal Sub Plan by 17.6 per cent to Rs. 21,710 crore
Multi-sectoralprogramme to address maternal and child malnutrition in 200 high burden districts
58 per cent rise in allocation to ICDS, at Rs. 15,850 crore
Rural drinking water and sanitation gets 27 per cent rise in allocation to Rs. 14,000 crore; PMGSY gets 20 per cent rise to Rs. 24,000 crore
Projects covering length of 8800 km to be awarded under NHDP against 7,300 km during 2011-12
RTE-SSA gets Rs. 25,555 crore allocation, showing an increase of 21 per cent; 6000 schools to be set up at block level as model
schools in the 12th Plan; Credit Guarantee Fund to be set up for better flow of credit to students
National Urban Health Mission is being launched
34 per cent increase in allocation to National Rural Livelihood Mission, to Rs. 3915 crore
Rs. 1000 crore allocated for National Skill Development Fund
Bharat Livelihood Foundation to be established to support livelihood interventions particularly in tribal areas
Widow pension and disability pension raised from Rs. 200 to Rs. 300 per month
Grant on death of primary breadwinner of a BPL family in the age group 18-64 years doubled to Rs. 20,000
Defence services get Rs. 193407 crore; any further requirement to be met
4000 residential quarters to be constructed for Central Armed Police Forces
UID-Aadhar to get adequate funds for enrolment of 40 crore persons, in addition to the 20 crore persons already enrolled
White Paper on Black Money to be laid in the current session of Parliament
Tax proposals mark progress in the direction of movement towards DTC and GST
Income tax exemption limit raised from Rs.1,80,000 to Rs.2,00,000; upper limit of 20 per cent tax slab raised from Rs.8 lakh to Rs.10 lakh
Interest from savings bank accounts deductible upto Rs.10,000; deduction of upto Rs.5,000 for preventive health check-up
Senior citizens without business income exempt from advance tax
Investment linked deduction of capital expenditure enhanced for certain businesses; new sectors eligible for investment linked deduction
Turnover limit for compulsory tax audit for SMEs raised from Rs.60 lakh to Rs.1 crore
STT on cash delivery reduced by 25 per cent to 0.1%
General Anti Avoidance Rule being introduced to counter aggressive tax avoidance
A number of measures proposed to deter generation and use of unaccounted money
All services to attract service tax except those in the negative list
Central Excise and Service Tax being harmonized
Standard rate of excise duty raised from 10 per cent to 12 per cent; service tax rates raised from 10 per cent to 12 per cent; no change in peak customs duty of 10 per cent on non-agricultural goods
Relief in indirect taxes to sectors under stress; agriculture, infrastructure, mining, railways, roads, civil aviation, manufacturing, health and nutrition, and environment get duty relief
Certain cigarettes and bidis attract higher excise duty; large cars attract higher customs duty
Excise imposed on unbranded jewellery also; measures to minimize impact on small artisans and goldsmiths; branded silver jewellery exempted from excise duty
Net gain of Rs.41,440 crore due to taxation proposals
Total expenditure budgeted at Rs. 14,90,925 crore; plan expenditure at Rs. 5,21,025 crore – 18 per cent higher than 2011-12 budget; non plan expenditure at Rs. 9,69,900 crore
Fiscal deficit targeted at 5.1 per cent of GDP, as against 5.9 per cent in revised estimates for 2011-12
Central Government debt at 45.5 percent of GDP as compared to Thirteenth Finance Commission target of 50.5 percent
Medium-term Expenditure Framework Statement to be introduced; will set forth 3-year rolling target.
Amendment to the FRBM Act proposed as part of Finance Bill. New concepts of “Effective Revenue Deficit” and “Medium Term Expenditure Framework” introduced
Central subsidies to be kept under 2 per cent of GDP; to be further brought down to 1.75 per cent of GDP over the next 3 years.
Proposed: Mobile based fertilizer management system; LPG transparency portal; scaling up and rolling out of Aadhar enabled payment for government schemes in at least 50 districts.
Rs. 30,000 crore to be raised through disinvestment
Efforts to reach broadbased consensus on FDI in multi-brand retail
Rajiv Gandhi Equity Saving Scheme: to allow income tax deduction to retail investors on investing in equities
Rs. 15,888 crore to be provided for capitalization of public sector banks and financial institutions
A central “Know Your Customer” depository to be developed
Swabhimaan: remaining habitations to be covered; to be extended to more habitations; ultra small branches to be set up in Swabhimaan habitations
Investment in 12th Plan in infrastructure to go uptoRs. 50,00,000 crore; half of this is expected from private sector
Tax Free Bonds of Rs. 60,000 crore to be allowed for financial infrastructure projects
Allocation of Road Transport and Highways Ministry enhanced by 14 per cent to Rs. 25,360 crore
Financial package of Rs. 3,884 crore for waiver of loans to handloom weavers and their cooperative societies; mega handloom clusters in Andhra, Jharkhand; weaver service centres in Mizoram, Nagaland and Jharkhand ; powerloom mega cluster in Maharashtra; Rs. 500 crore pilot schemes for geo-textiles in North-Eastern region
Rs. 5,000 crore India Opportunities Venture Fund to help small enterprises
Allocation to agriculture enhanced; RKVY gets Rs. 9,217 crore; BGREI gets Rs. 1,000 crore; Rs.2242 crore project to improve dairy productivity; Rs. 500 crore for coastal aquaculture
Various other agricultural activities merged into 5 missions
Target for agricultural credit raised to Rs. 5,75,000 crore
Interest subvention for short-term crop loans to farmers at 7 per cent interest continues; additional 3 per cent for prompt paying farmers
Rs. 200 crore for awards to incentivise agricultural research
Provisions under rural housing fund increased to Rs. 4,000 crore from Rs. 3,000 crore
Interest subvention of 1 percent on housing loans uptoRs. 15 lakh extended for one more year
AIBP allocation raised by 13 per cent to Rs. 14,242 crore
National Mission on Food Processing to be started in cooperation with State Governments
Scheduled Caste Sub Plan allocation increases by 18 per cent to Rs. 37,113 crore; Tribal Sub Plan by 17.6 per cent to Rs. 21,710 crore
Multi-sectoralprogramme to address maternal and child malnutrition in 200 high burden districts
58 per cent rise in allocation to ICDS, at Rs. 15,850 crore
Rural drinking water and sanitation gets 27 per cent rise in allocation to Rs. 14,000 crore; PMGSY gets 20 per cent rise to Rs. 24,000 crore
Projects covering length of 8800 km to be awarded under NHDP against 7,300 km during 2011-12
RTE-SSA gets Rs. 25,555 crore allocation, showing an increase of 21 per cent; 6000 schools to be set up at block level as model
schools in the 12th Plan; Credit Guarantee Fund to be set up for better flow of credit to students
National Urban Health Mission is being launched
34 per cent increase in allocation to National Rural Livelihood Mission, to Rs. 3915 crore
Rs. 1000 crore allocated for National Skill Development Fund
Bharat Livelihood Foundation to be established to support livelihood interventions particularly in tribal areas
Widow pension and disability pension raised from Rs. 200 to Rs. 300 per month
Grant on death of primary breadwinner of a BPL family in the age group 18-64 years doubled to Rs. 20,000
Defence services get Rs. 193407 crore; any further requirement to be met
4000 residential quarters to be constructed for Central Armed Police Forces
UID-Aadhar to get adequate funds for enrolment of 40 crore persons, in addition to the 20 crore persons already enrolled
White Paper on Black Money to be laid in the current session of Parliament
Tax proposals mark progress in the direction of movement towards DTC and GST
Income tax exemption limit raised from Rs.1,80,000 to Rs.2,00,000; upper limit of 20 per cent tax slab raised from Rs.8 lakh to Rs.10 lakh
Interest from savings bank accounts deductible upto Rs.10,000; deduction of upto Rs.5,000 for preventive health check-up
Senior citizens without business income exempt from advance tax
Investment linked deduction of capital expenditure enhanced for certain businesses; new sectors eligible for investment linked deduction
Turnover limit for compulsory tax audit for SMEs raised from Rs.60 lakh to Rs.1 crore
STT on cash delivery reduced by 25 per cent to 0.1%
General Anti Avoidance Rule being introduced to counter aggressive tax avoidance
A number of measures proposed to deter generation and use of unaccounted money
All services to attract service tax except those in the negative list
Central Excise and Service Tax being harmonized
Standard rate of excise duty raised from 10 per cent to 12 per cent; service tax rates raised from 10 per cent to 12 per cent; no change in peak customs duty of 10 per cent on non-agricultural goods
Relief in indirect taxes to sectors under stress; agriculture, infrastructure, mining, railways, roads, civil aviation, manufacturing, health and nutrition, and environment get duty relief
Certain cigarettes and bidis attract higher excise duty; large cars attract higher customs duty
Excise imposed on unbranded jewellery also; measures to minimize impact on small artisans and goldsmiths; branded silver jewellery exempted from excise duty
Net gain of Rs.41,440 crore due to taxation proposals
Total expenditure budgeted at Rs. 14,90,925 crore; plan expenditure at Rs. 5,21,025 crore – 18 per cent higher than 2011-12 budget; non plan expenditure at Rs. 9,69,900 crore
Fiscal deficit targeted at 5.1 per cent of GDP, as against 5.9 per cent in revised estimates for 2011-12
Central Government debt at 45.5 percent of GDP as compared to Thirteenth Finance Commission target of 50.5 percent
Medium-term Expenditure Framework Statement to be introduced; will set forth 3-year rolling target.
Get detail updates on the link here, provided by Economic Times.
Get the direct speech (Video) of Pranab Mukherjee on Union Budget 2012 here.
Cheers!!!
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