Highlights of Union Budget 2010

Taxation

• 25% tax savings for people who are earning upto Rs 1 lakh pm
• Service tax unchanged at 10%
• Online news agencies to attract tax
• Account editing for companies with income above Rs 15 lakhs
• More services to be taxed
• Peak custom duty unchanged at 10%
• 5% custom duty on crude petrol back
• Minimum alternate tax hiked from 15% to 18%
• Corporate surcharge down from 10% to 7. 5%

Tax slabs

• Upto 1.6 lakhs- Nil
• Above 1.6 lakhs to Rs 5 lakhs- 10%
• Above 5 lakhs to 8 lakh: 20%
• Above 8 lakhs 30%
• R&D deduction hiked

What cost more

• Petro products to cost more
• Cement to cost more
• Large cars, SUVs to cost more
• Cigarettes, non-smoking, chewing tobacco to cost more
• Gross Tax Receipts Rs 7. 46 Lakh crore
• Fuel price hike in due course

What cost less

• Custom duty on gold to be reduced; Gold cheaper
• Rationalisation of custom duty on gaming software; gaming software to cost less
• Mobile phones to be cheaper

Reactions & Budget impact

• Budget a right mix, says PM
• Dictatorship of Congress government will not work: Lalu
• Pranab had no choice on fuel price hike: PM
• Markets happy, Sensex jumps 300 points as FM concludes Budget speech

Govt. expenditure

• Fiscal stimulus to be partially rolled back
• Defence allocation up by 6000 cr
• 15% rise in plan expenditure
• Fiscal deficit 5.5% for FY 11
• Fiscal deficit 4.8% for FY 12
• Special allocation for unorganized labour sector

IT- sector

• Technology Advisory Group to function under Nandan Nilekani

Banking & Finance

• Rs 16,500 cr allocated to public sector banks
• Divestment proceedings to be spent on social sector
• Double digit food inflation a worry
• RBI considering giving banking licenses to more private players
• Medium term growth plan to cross double-digit figure
• Private investment can sustain 9% growth
• Need to review fiscal stimulus
• GDP to reach 10% soon
• Efforts on to reduce inflation in two months

Urban Development

• Slum free India at the earliest
• Bharat Nirman outlay Rs 48,000 cr
• NREGA allocation Rs 40,100 cr
• Banks in all villages with over 2000 population
• Subsidy for affordable housing increased

Education

• Increase in allocation for school education

Power

• Plan allocation to renewable energy ministry hiked
• Coal regulatory authority to be set up
• National clean energy fund to be set up

Infrastructure

• Plan allocation doubled for power sector
• To construct 20 km highway everyday
• 13% rise in allocation for transport sector
• 5 mega food parks to be set up
• Infrastructure thrust to be maintained in rural and urban areas
• Govt. committed to SEZ growth

Agriculture sector

• Budget gives strong focus to boost agri production
• Rashtriya Krishi Vikas Yojna to get Rs 300 cr
• Four pronged strategy to boost agri production
• Repayment of loans to be extended to 6 months in drought and flood hit areas
• Fertilizer subsidy to be reduced
• Failure in agriculture sector compensated by good show in manufacturing sector

Exports

• 2% interest subvention for exports extended
• Interest subvention to benefit handicraft, jewellery and gem exports

Textiles

• One-time 200 cr for allotment to Tripura Textile sector in Tamil Nadu

Social and welfare sector

• New pension scheme for unorganized sector
• Exclusive skill development programme for textile sector
• Plan outlay increase for women and child welfare
• Plan outlay increase for ministry of social justice and women empowerment
• Outlay for Ministry of minority welfare increased
• Rs 1,900 cr for Unique Identity Authority (UIDA)