Cabinet has approved Union Budget 2012 and will be announced by finance minister Pranab Mukherjee in another few minutes i.e at 11 am on 16th March 2012. We will keep a close eye on every announcement at union budget and update you live. So stay with us and don’t miss any announcement which can benefit or affect your pocket this year.
All set at Loksabha, the announcement for union budget has started. Have a look at the main highlights of union budget 2012-13.
- Finance minister Mr. Pranab Mukherjee has start presenting Union Budget 2012-13 at Indian Parliament at 11 am.
- t is been proposed to offer direct subsidy to the farmers will get direct subsidy, including fertilizer subsidy, pilot projects are already running.
- VAT and Excise will be replaced with Goods and service tax (GST) by August 2012.
- Direct Tax Code (DTC) will not be implemented in this financial year.
- Pension, banking bill will be presented in this year.
- Retail investors with annual income of Rs 10 lakhs will get 50% tax exemption on investment of Rs 50,000 in share market.
- New Rajiv Gandhi Equity saving scheme will be introduced this year.
- Government will issue 60 thousand crore tax free bonds this year.
- Subsidy of 1% on home loan for housing property upto Rs 25 lakhs will continue this year.
- Home loan of Rs 15 lakh for housing property of upto Rs 25 lakhs will be available.
- Rs 10,000 crore tax free bonds for power sector.
- Exemption of 3% on interest for timely loan payment by farmers will continue this year.
- Airlines will be allowed to purchase fuel directly from foreign countries.
- New ration stores will be open by end of this year.
- New fund will be formed for education loan.
- New law for Food security bill this year.
- 6 thousand new schools and 7 new medical colleges will be open this year.
- Widow and handicap pension will be increased to Rs 300.
- Farmer’s credit card will be activated to be used at ATM for cash withdrawal.
- 82 double tax avoidance agreements (DTAA) has been made with 17 new countries.
- Direct Tax : Income tax exemption limit has been raised form 1,80,000 to Rs 2 lakh.
- No tax will be levied for income upto Rs 2 lakhs for individuals.
- New Direct Tax rates for individuals : For income ranges between 2 lakh to 5 lakhs – income tax rate will be10%.
- New Direct tax rate for individuals : For income ranges between 5 lakh to 10 lakh – income tax rate will be 20%.
- New Direct tax rate for individuals : For Income above Rs 10 lakh – income tax rate will be 30%.
- No changes in corporate rate rates this year.
- No tax on bank saving interest of Rs 10,000.
- Senior citizens are not required to pay advance tax anymore in case of no business income.
- Service Tax : Service tax has been increased from 10% to 12% this year.
- Service Tax Rate has been revised to 12%.
- Mobile phone bills, Restaurant Food, Air tickets, beauty parlor services, cable TV. internet services, hotel stay, holiday packages, color TV, cosmetics, insurance premium will be expensive due to revision in service tax.
- Excise duty on big cars has been revised from 22% to 24%.
- Big car will go expensive due to high excise duty i.e 24%.
- Inflation will rise due to increase in service tax and excise duty.
- Price of Television, Fridge and cars, Branded garments will rise due to increase in excise duty.
- Custom duty on iron ore equipment’s reduced to 2.5% from 7.5%.
- Increase in basic custom duty on tobacco products like cigarettes, gutka.
- Branded silver jewelry will exempt from service tax.
- School education exempt from service tax .
- Custom duty on gold and platinum products increased.
- Security Transaction Tax (STT) has been reduced by 20% (cut from 0.125% to 0.1%).
- Additional tax deduction of Rs 5000 for preventive health checkup other than medical insurance.
- Custom duty on branded gold has increased from 2% to 4%.
- 1% Tax on sale of immovable property.
Analysis Of Union Budget 2012
- Women Tax Payers : -No additional tax relief for women tax payers.
- No tax relief for tax payers in the income group of 5 lakh to 10 lakh.
- Saving bank interest for upto Rs 10,000 will be exempt from tax.
- Service Tax and excise duty increased by 2%.
- Rajiv Gandhi Equity Savings scheme will offer tax exemption of Rs 50,000 on retail equity investments. Retail investors will get income tax deduction of 50% for those who invest Rs.50,000 in equity and whose annual income is less than Rs.10 lakh, subject to a three -year lock in period.
- Air tickets, Air Condition, Refrigerators, Gold, luxury cars, motor bikes, diamonds is going to be expensive due to increase in duties.
- Prices of Mobile Phones, LCD, LED will reduce.
- Real Estate : Due to increase in service tax, expensive cement and other charges, real estate prices will rise.
- Cost of Bank Draft, Pay order and Ac rail travel will reduce.
- Remove cascading effect of dividend distribution tax
- Prices of consumer durables will rise.
- Interest subvention scheme i.e 1% interest subsidy for home loan upto Rs 15 lakh for a housing property of Rs 25 lakh will continue for this year.
- Builders can take loan from foreign investors.
- Withholding tax on External commercial borrowing (ECBs) for some sectors cut to 5% from 20%.
- Liquor prices will go up due to change in duties.
- Service tax will now be imposed on 246 services (currently 120 services).
- New Income Tax (IT) Slabs For The Financial Year (FY) 2012-13, Assessment Year (AY) 2013-14
|RATE||MEN / WOMEN||SENIOR CITIZENS
(60 Years And Above)
|Very Senior Citizens
(80 Years And Above)
|0%||Upto 2 lakhs||Upto 2.5 lakhs||Upto 5 lakhs|
|10%||2 lakhs – 5 lakhs||2.5 lakhs-5 lakhs||NIL|
|20%||5 lakhs – 10 lakhs||5 lakhs-10 lakhs||5 lakhs-10 lakhs|
|30%||10 lakhs – Above||10 lakhs – Above||10 lakhs-Above|