Budget Highlights 2012

Income Tax & Exemptions, Deductions:

IT Exemption Limit hiked to Rs 2 lakh
Income from Rs 2 lakh to Rs 5 lakh – 10 per cent tax
Income from Rs 5 lakh to Rs 10 lakh – 20 per cent tax
Income above Rs 10 lakh – 30 per cent tax
Senior citizens to be exempt from advance tax payments
Health insurance deduction upto Rs 5000 for preventive health checkup
Remove cascading effect of dividend distribution tax
Interest income from banks tax-free upto Rs 10,000
No change in corporate tax rate
Sale of residential property exempted from capital gains if invested in equity or equipment of an SME
To introduce Rajiv Gandhi Equity Scheme for retail investors. New equity savings scheme to provide for income tax deduction of 50 percent for those who invest Rs.50, 000 in equity and whose annual income is less than Rs.10 lakh
Income Tax deduction of 50 per cent on investments of up to Rs 50,000 in savings scheme named after Rajiv Gandhi. 3-year lock-in period exemption under Rajiv Gandhi scheme
Investment upto Rs 50,000 in stock markets to get concessions
Tax exemption on individual share investment below Rs 10 lakh

Service Tax:

All services to be taxed except those in negative list, Negative list to include pre-school and high school education, entertainment services, Service tax net widened; to include most sectors
Service tax rates hiked from 10 per cent to 12 per cent, Service tax to yield additional revenue of Rs 18,650 crore
Common 1-page return for excise and service tax
Industry taxes Excise, Custom:
GST to be operational by Aug 2012
Direct Tax Code (DTC) Bill to be enacted at the earliest
Withholding tax on external commercial borrowings reduced from 20 percent to five percent for power, airlines, roads, bridges, affordable houses and fertiliser sectors
Common 1-page return for excise and service tax
Propose common tax code for service tax and excise
Standard excise duty rate raised from 10 per cent to 12 per cent

General:

India expected to grow at 6.9 per cent
2.5% growth in agriculture this year
Exports grew by 23% in the First Quarter
Inflation is expected to moderate in a few months and then stabilize
Current account deficit 3.6 percent in 2011-12; this put pressure on exchange rate
International crude oil prices may cross $ 115 per barrel. This will impact the Fuel Subsidy Bill. Subsidies have hit fiscal balance
Food and fertilizer subsidy largest expenditure
India's slowdown attributed to weak industrial growth
The Nandan Nilekani panel recommendation on direct transfer of subsidy accepted. FY13 subsidy to be under 2% of GDP, Food security subsidy to be fully provided
Direct cash subsidy for LPG, kerosene. Direct transfer of subsidies to retailer & farmer on fertilizers
Government examining new ways of providing subsidies for LPG, kerosene
Rs 30,000 crore divestment target next year
Aadhar-enabled payment of select government schemes in 50 districts
Budget to provide Rs 15,888 crore for recapitalization of PSU banks, regional rural banks .Govt to create Financial Holding Company to meet financial needs of PSU banks
Increase in investments in infrastructure through PPP. Infrastructure investment in 12th Plan to go up to Rs 50 lakh crore; half of it to come from private sector
FY13 tax free bonds of Rs 10000 cr for NHAI, Allocation for national highways up 14 per cent 8,800 km of highways to be developed under National Highway Development Project in 2012-13
Bills on micro-finance institutions, national land bank and public debt management among those to be introduced in 2012-13
Government actively considering 49 per cent FDI in aviation, Airlines allowed to tap foreign loans on working capital now, External commercial borrowings to the extent of $ 1 billion to be allowed for aviation sector for next year
India to become self sufficient in manufacturing sector by next year, Enhanced production will take place
India to become self sufficient in urea production in five years
National Population Register to be completed in two years

Allocations & proposals:

Rs 242 crore project with World Bank assistance to improve dairy production
UID allocation at Rs 14,232cr in FY13c
FY13 midday meal scheme outlay at Rs 11937 crore
Government to set up company to finance minor irrigation works
National Mission on Food Processing to be started in 2012-13
Rs 12,040 cr for backward area projects in FY13
6,000 schools have been proposed to be set up in 12th Year Plan
Allocation for rural drinking water and sanitation scheme increased from Rs 11,000 crore in FY 12 to Rs 14,000 crore in 2012-13
Rs 15,850 crore to be allocated to Integrated Child Development Scheme in 2012-13 as against Rs 10,000 crore this fiscal
Propose credit guarantee fund for education loans
Maternal and child nutrition scheme to be launched in 200 districts ICDS to get 58 per cent
NRHM allocation increased to Rs 20,820 cr
Allocation of Rs.200 crore for research on climate change
Rs 20,000 crore to be spent on rural infrastructure development, including Rs 5,000 crore for creating warehousing facilities
National Backward Region Grant scheme outlay raised by 22 per cent to Rs 12,040 crore
FY13 National Social Assistance Scheme outlay at Rs 8447 crore
Rs 1,000 crore to be provided for National Skill Development Corporation in 2012-13
Interest subvention of 7 per cent to women self groups for loans up to Rs 3 lakh, additional 3 per cent for those making timely repayment
Mahatma Gandhi rural employment scheme has been positive
ECB for Rupee-debt of power co positive for all power cos
Rs 193,407 crore provision made for defence services in 2012-13
Allots Rs 24,000 crore for rural road plan in FY13
Rs 3,915 crore to be spent on National Rural Livelihood Mission
7 medical colleges to be upgraded to All India Institutes
Rs 200 crore for Research Rewards for agricultural researchers for breakthroughs
4000 residential quarters to be constructed for paramilitary forces with an allocation of Rs 1,185 crore
40 crore Aadhar enrollment in year beginning April 2012
Total expenditure outlay for FY13 at Rs 15 lakh crore
FY13 market borrowing at Rs 4.79 lakh cr

Black Money:

Information on black money stashed abroad has started flowing in, prosecution to be executed in some cases, Proposes to bring white paper on black money in the current Parliament session

Other Duty changes:

No change in peak custom duty
Large cars duty raised from 22% to 24%
Exemption of customs duty of 5% on equipment for fertiliser plants
Introduction of compulsory reporting of assets held abroad
Import of aircraft parts exempt from basic customs duty
Customs duty on import of parts of aircraft, tyres and testing equipment fully exempted
Full exemption from basic customs duty for equipment for road and highway construction
AC, fridge and most urban services to cost more
Full exemption from basic customs duty on natural gas, LNG, uranium for generation of electricity for two years
Bicycles to get expensive, duty raised to 30% from 10%
Full exemption from basic customs duty for equipment for road and highway construction
Solar power lamps, LED bulbs to become cheaper
Duty on CFLs reduced
Excise duty on handmade and semi-mechanized matches reduced from 10 to 6 per cent.
Iodized salt, match-boxes, soya products to become cheaper
Gold to be more expensive
Cigarettes, gold, diamonds, imported cycles to cost more
Customs duty on bicycles and parts increased
Customs duty on standard gold raised from 2 per cent to 4 per cent
Oil cess on domestic crude raised to Rs 4,500 per ton from Rs 2,500 per ton.
Raise customs duty on some vehicle imports to 75% from 50%
Raise customs duty on some vehicle imports to 75% from 50%
Solar power lamps, LED bulbs to become cheaper
Excise duty on handmade and semi-mechanized matches reduced from 10 to 6 per cent
Gross taxes estimated at 10.6 per cent of GDP, tax collection up by 15% Net tax receipts of the Centre in 2011-12 stands at Rs 7,71,071 crore
Direct tax collection fell short by Rs 32,000 crore in current fiscal
Fiscal deficit at 5.9 per cent of GDP in revised estimates for 2011-12
Non-plan expenditure Rs 9, 69,900 crore in 2012-13; 8.7 per cent higher than current year