My Life

Suspense is over and FM came up with budget 07-08 . The much hyped eventful budget was nothing special and wonderful piece. I had expectation that FM will think about taxpayers and will probably give more burden on small scale industries who make a lot of profit and don’t pay tax.I think this eventful budget will become non-eventful over the period of time. This budget is more about anti-inflation and politics. After lossing state elections in two states of nothern India congress party was quite apprensive about exorbitant rises in prices of foods.Mr Chidambaram was under immense political pressure. Anybody could have see impact of this on budget. I would rate this budget 6 on the scale of 1 to 10.
Positive things about budget :
1) There are a lot of provisions which focus on education , healthcare which is very important for the development of country.There is a significant rise in fund allocation for these. But I think government should not provide scholarship on the basis of caste. Only poor people of all castes should be eligible for this. There is rise in scholarship on SC/ST allocation. According to me it is tumbs down.
2) Edible oils, footwear will cost less and government can use forex reserve for importing food items if necessary. This is good for consumer.

3) I liked one thing about budget is that FM put stress on fiscal deficit consolidation.It’s a right step towards growth.

4) PAN to be made sole identification number for all participants in securities market.
5) Individuals to be permitted to invest in overseas securities through indian mutual funds.

Negative things
1) FM put a lot of burden on corporate by brining new minimum alternative tax (MAT).
2) Increases the tax rate on dividends paid out.
3) ESOP will come under fringe benfit tax (FBT). I think this is discouraging for entrepreneurs. I was expecting that FBT and BCTT (Banking cash transaction tax) will be removed. for BCTT , limit has been raised from 25k to 5o k.
4) There has been a little rise in income tax exemption but has been nullified by hike in education cess. I think inflation has moved from 4 % to 6.73 %. There was a need of increasing the limit of tax exempted saving but It did not happen.
5) This budget will not make a positive impact on aam aadmi and tax payers.

And most importantly there is no improvement on efficiency on transparency of tax administration. This is the need of hour.
I wish our visionary Mr Chidambaram could have understood this thing. People are loosing interests in an eventful thing like budget because of lack of transparency in it.