Budget 2008 Highlights updated every 30 minutes. (Source BSEINDIA)
Budget Speech ends.
Central sales tax cut to 2% from 3%. FM’s Direct Tax (personal income tax) proposals to be revenue neutral. Indirect tax proposals to result in loss of Rs 5,000 crore.
Banking cash transaction tax withdrawn from April 1, 2009.
Commodities Transaction Tax to be introduced on the lines of Securities Transaction Tax.
Five year tax holiday for promoting cultural tourism.
Five year tax holiday for setting up hospitals in tier II and tier III regions for providing healthcare in rural areas from April 1, 2008.
Fresh facilities, encouragement to sports and guest houses exempted from Fringe Benefit Tax.
COMMODITIES TRANSACTION TAX IMPOSED AT THE SAME RATE AT THE STT
For women, the income tax limit goes up from Rs 1.45 lakh to Rs 1.80 lakh. In case of senior women citizens, it increases from Rs 1.95 lakh to Rs 2.25 lakh.
Securities Transaction Tax is a deductible expenditure from now on
New tax slabs will be: 10 per cent for Rs 1,50,000 to Rs 3,00,000, 20 per cent for Rs 3,00,000 to Rs 5,00,000 and 30 per cent above Rs 5,00,000.
Short term capital gains tax increased to 15%
Asset management service under mutual funds, services by stock exchanges to be brought under Services Tax net.
Changes in IT slab. Threshold of exemption for all Income Tax assesses raised from from 1,10,000 to 1,50,000.
Threshold for small service providers raised from Rs. eight lakh to Rs 10 lakh.
NO CHANGE IN CORPORATE INCOME TAX, NO CHANGE IN SURCHARGE
TAX EXEMPTION FOR WOMEN: RS 180000
TAX EXEMPTION FOR SENIOR CITIZENS: RS 225000
PERSONAL TAXATION: EXEMPTION LIMIT INCREASED TO 1,50,000 FROM RS 1,10,000.. everyone gets a relief of Rs 4000!
PERSONAL TAXATION: SLABS CHANGED
General Centvat on all goods to be reduced from 16 per cent to 14 per cent. Excise duty reduced from 16 per cent to eight per cent on all pharmaceutical goods manufacture.
Excise duty on small cars reduced to 12 per cent from 16 per cent and hybrid cars to 14 per cent.
Duty on crude and unrefined sulphur reduced from five to 2 per cent to help raise domestic fertiliser production.
CIGARETTES TO BE TAXED MORE. Duty on non filter cigarettes to be raised.
No change in peak rate of customs duty for non agriculture imports.
Tax to GDP ratio increased from 9.2 per cent in 2004-05 to 12.5 per cent 2007-08.
Excise duty on two-wheelers cut from 16% to 12%
Excise duty on small cars cut.. might become cheaper
Duty withdrawn on naptha for production of polymers.
No excuse duty on wireless data cards, composting machines. Excise duty reduced from 16 to 8 per cent on water purification items.
Special Countervailing Duty on power imports.
Customs duty on specified sports goods machinery down from 7.5 per cent to five per cent.
Customs duty on specified life saving drugs reduced from ten per cent to five per cent.
EXCISE DUTIES: GENERAL CENVAT RATE CUT ON ALL GOODS FROM 16% TO 14%. This is being done to boost the manufacturing segment
TAX: helicopter similators, customs duty cut
TAX: Customs duty exemption on Naphtha withdrawn, execpt for that used for making fertilizers
TAX: Convergence products, duty cut from 10% to 5%
TAX: SOME SPORTS GOODS raw materials exempt from duty
TAX: no duty on set-top boxes
HOWEVER, CUSTOMS DUTIES TO BE REDUCED ON SOME POWER PROJECTS, STEEL MELTING SCRAP, ON SOME LIFE-SAVING DRUGS.
CUSTOMS DUTY: NO CHANGE IN PEAK RATE OF CUSTOMS DUTY
TAXATION: promises tax payer friendly regime.
Fiscal deficit pegged at 3.1 per cent and revenue deficit at 1.4 per cent.
Rs 624 crore allocated for Commonwealth Games.
DEFENCE: Allocation for defence to be increased by 10 per cent from Rs 96,000 crore to Rs 1,05,600 crore.
PROTECTING THE TIGER: One time grant of Rs 50 crore for the National Tiger Fund Authority, to deploy a special tiger protection force.
DEFENCE: Allocation to be increased by 10%
6th Pay Commission to table report by March 31 2008.
Three schemes to be introduced for providing social security to unorganised sector workers.
Rs 750 crore for upgradation of 300 ITIs in 25 districts.
PDS — Public Distribution System — through smart cards in Haryana and Chandigarh to start on pilot basis.
Rs 32,676 crore as subsidy to Public Distribution System.
Chidambaram said that according to estimates, 3 crore marginal and small farmers would benefit from the overnment’s amnesty. Under the one-time settlement scheme that will benefit another one crore farmers, the government will give a rebate of 25 per cent on payment of outstanding loans. The agricultural credit of scheduled banks is estimated at Rs 2,40,000 crore in the current fiscal and it would go up to Rs 2,80,000 crore in 2008-09.
PAN requirement to be extended to all transactions in capital market subject to a threshold.
Presenting his fifth Budget and the last one before the general elections, Chidambaram announced waiver of Rs 50,000 crore worth of loans to small and marginal farmers and a settlement scheme for other farmers that would cost the exchequer another Rs 10,000 crore.
Finance Minister P Chidambaram today announced a Rs 60,000-crore relief package for farmers, including complete waiver of loans given to small and marginal farmers.
So where will the money come from? Is he going to tax us more? Wait with bated breath as he is about to roll out his tax proposals in a moment.
Risk Capital Fund to be set up in SIDBI, the Small Industrial Development Bank of India.
PAN NEEDED FOR ALL MARKET TRANSACTIONS.
GOOD NEWS FOR TEXTILES: Allocation for Textile Upgradation Fund to be more than doubled.
SMEs TO BENEFIT: Micro, small and medium enterprises to continue to get special attention, says the finance minister.
75 lakh people to be covered by health insurance schemes, says FM.
MORE ON FARMERS’ LOAN WAIVER: The loan waiver scheme will benefit 3 crore (30 MILLION) small and medium farmers and cover loans totalling Rs 50,000 crore (Rs 500 billion). One crore (10 million) other farmers will benefit to the tune of Rs 10,000 crore (Rs 100 billion) in the waiver.
OIL EXPLORATION: Foreign investment of $3.5 billion to $8 billion expected for exploration and development of new oil blocks.
Rs 800 crore for accelerated power reforms programme.
National Fund for Transmission and Distribution Reforms to be launched.
More reforms needed in coal and electricity sectors to ensure double digit growth in manufacturing sector.
The corpus of rural infrastructure development fund to be raised to Rs 14,000 crore, the FM says.
Loan waiver scheme to involve loans liability of Rs 60,000 crore and to benefit four crore farmers.
By loan waiver scheme, the country is discharging a deep debt and sense of gratitude to farmers, says Chidambaram.
The government proposed to waive agricultural loans given by scheduled commercial banks, regional rural banks and cooperative credit institutions to farmers up to March 31, 2007 and due for December 31.
Stock market benchmark Sensex today dropped by over 200 points, in the middle of Finance Minister P Chidambaram announcing loan waivers worth Rs 60,000 crore for farmers in his budget speech.
Market falls by 222.91 points to 17601.57 amid loan waiver announcement in budget.
Implementation of debt waiver and debt relief for farmers will be completed by June 30 this year, the FM announced.
Agriculture loans restructured and rescheduled by banks from 2004-06 and other loans normally rescheduled under RBI guidelines will also be eligible under the waiver scheme.
There will, says FM, a one-time settlement of loans for other farmers.
Chidambaram begins again.. amidst more noise and shouts and slogans..
Meanwhile, statistics show that inflation has risen to 4.89 per cent for the week ended February 16, against 4.35 per cent in the previous week.
Chidambaram’s budget is certainly addressing a vote bank: farmers. If this is an indication of things to come, it might turn out to be a very very populist budget.
House erupts in uproar. Opposition and govt MPs are shouting at the top of their voices. Speech held up for now.
A scheme of debt waiver and relief for small and marginal farmers announced.
National Plant Protection Training Institute at Hyderabad to be made autonomous body and Rs.29 crore will be allocated to it.
ALL AGRI LOANS DISBURSED BY COMMERCIAL BANKS TO BE WAIVED
Rs 75 crore to be given to Agriculture Ministry for providing mobile soil testing laboratories in 250 districts.
National Horticulture Mission to be given Rs 1,100 crore in 2008-09 with special focus on coconut cultivation.
COMPLETE WAIVER OF ALL LOANS FOR SMALL AND MARGINAL FARMERS.
Rs 644 crore for National Agriculture Insurance Scheme, which will be continued pending evolving an alternative crop insurance scheme.
Rs 20,000 crore for irrigation projects under AIPB, showing an increase of Rs 9,000 crore over last year.
FARMERS’ DEBT TO BE WAIVED!
Manufacturing, construction pull down Q3 GDP to 8.4 per cent A downturn in manufacturing and construction sectors pulled down economic growth rate in the third quarter of this fiscal to 8.4 per cent from 9.1 per cent a year ago. While the growth rate of the manufacturing sector came down to 9.3 per cent during October-December 2007 from 11.3 per cent in the corresponding period previous year, the construction sector growth rate dipped to 8.4 per cent from 10.8 per cent during the same period. According to quarterly estimates of Gross Domestic Product (GDP) released by the government today, October-December quarter was the worst in 2007-08 in terms of economic growth (8.4 per cent), which in turn can make come true the fears expressed in the Economic Survey that GDP growth for the full fiscal would fall below 9 per cent. The Economic Survey, tabled by Finance Minister P Chidambaram in Parliament yesterday, had said the economy during 2007-08 is expected to grow by 8.7 per cent. The GDP
A target of Rs 2.80 lakh crore for agriculture credit set for the coming year.
Rs 500 crore for corpus fund to subsidise all women Self Helf Groups for LIC cover for permanent disability.
Rs 7,200 crore to be allocated to the Ministry of Women and Child Development, marking an increase of 24 per cent.
Meanwhile, the prices of some commodities like urad dal, gram dal and sooji have declined while maida edged up in the wholesale foodgrains market. Urad dal moved back to Rs 3,750 from Rs 3,850. Gram dal moved down by Rs 150 per quintal to Rs 3,100 from previous rate of Rs 3,250. Sooji edged down by Rs 25 to Rs 1,500 from against previous rate of Rs 1,525.
288 public sector bank branches to be opened in districts having minority community concentration.
Agriculture growth rate at 2.6%. Agri credit too has doubled. More funds to be allocated for agriculture credit/loans.
Rs 540 crore for multi-sectoral development plan for minority concentration districts.
Scheduled Castes, Scheduled Tribes and minority students to continue to get special attention.
Allocation for several schemes in North East raised from Rs 14,365 crore to Rs 16,400 crore.
Rs 500 crore for identifying urgent needs of development programmes of border areas like Arunachal Pradesh.
Allocation for Rajiv Gandhi Drinking Water Mission to be increased to Rs 7,300 crore. Rs 200 crore for potable water in schools. Rs 300 crore to be set aside for desalination plant in Chennai for drinking water.
NREGA — the National Rural Employment Guarantee Scheme — to be rolled out in all the 596 rural districts in the country in 2008-09.
Jawaharlal Nehru Urban Renewal Mission to get Rs 6,865 crore this year against Rs 5,482 crore past year.
Some opposition members make noise to disrupt the speech, but the trouble passes soon.
Indian Institutes of Science Education and Research to be set up at Bhopal and Thiruvananthapuram.
The speech goes on… Rs 85 crore sanctioned for scholarships to students pursuing science education, says the finance minister.
Rashtra Swasthya Beema Yojana to start from April 1, 2008 in Delhi and Haryana. Rs 30,000 for each family belonging to unorganised sector.
Rs 992 crore for national AIDS programme.
Allocation for ICDS — Integrated Child Development Schemes — increased to Rs 6,300 crore.
A national programme for the elderly to be started at a cost of Rs 400 crore.
Health outlay has been raised by 15%.
Allocation for NRHM — the National Rural Health Mission — increased to Rs 12,050 crore.
Rs 100 crore to be given to the Information Technology ministry to set up national knowledge centres, the FM announced.
Allocation for NRHM increased to Rs 12,050 crore.
The country’s economic growth slowed down to 8.4 per cent for the quarter ended December 31, 2007, reflecting the apprehensions expressed in the Economic Survey that GDP expansion would fall below 9 per cent. The GDP growth during the year-ago quarter had stood at 9.1 per cent, while growth during the full year 2006-07 had touched 9.6 per cent. The Economic Survey, tabled in Parliament yesterday by Finance Minister P Chidambaram, had said economic expansion would cool to 8.7 per cent in 2007-08 due to sluggishness in consumer durables segment, infrastructure and industrial production. “The new challenge is to maintain growth at these levels, not to speak of raising it further to double digit levels,” the Survey, a report card on the economy, had said.
Schools of architecture and planning to be set up in Bhopal and Vijaywada.
Navodaya Vidyalayas to be opened in 20 districts with special focus on regions having SC/ST concentration. Allocation of Rs 130 crore for this purpose has been proposed by the finance minister.
Three IITs to be set up in Andhra Pradesh, Bihar and Rajasthan.
16 central universities to be opened in 2008-09.
FM plans to provide Rs 13,100 crore for the Sarva Siksha Abhiyan.
Rs.750 crore more to be given for merit scholarship to students up to 10th and 12th class.
Mid day Meal scheme extended to upper primary level in 3479 schools.
410 additional Kasturba Gandhi Vidyalaya to be set up in backward blocks.
Gross budgetary support to be raised to Rs 2,43,386 crore, an increase of more than Rs 38,000 crore from last year.
Allocation for Bharat Nirman to be raised to Rs 31,280 crore.
Twenty per cent hike in education budget this year from Rs 28,674 crore to Rs 34,400 crore.
Eleventh Plan started on a robust growth.
6,000 high quality ‘model schools’ to be set up at a cost of Rs 600 crore. FM wants India to be a knowledge society.
Agriculture credit doubled in the first two years of the government to reach Rs 2.4 lakh crore (Rs 2.4 trillion) by March 2008.
Primary education to be a major policy initiative in this year’s Budget.
The FM plans to allot more for education, especially at the primary school level.
Agriculture credit has been doubled in the first two years of UPA rule, says the FM.
Rice production estimiated at 94.08 million tonnes, maize 16.78 mt, soyabean 9.45 mt and cotton 23.38 million bales.
Keeping inflation under check is one of the cornerstones of the Government’s policy.
Services and manufacturing sectors expected to grow by 10.7 per cent and 9.4 per cent, says Chidambaram.
Govt will monitor foreign fund inflow, the FM said.
Govt will take steps to take steps to check rise of inflation.
We need to be vigilant and be proactive to change our policies, to counter this global problem.
Growth rate of agricultre extimated at 2.6 per cent during the current year.
This is the FM’s 7th Budget.
Agriculture growth was disappointing at 2.6% only, hurting the economy. The rise in global oil prices too has hurt us, say the FM.
Indian economy, like all developing economies, are beinghurt by these global upheavals in prices.
India’s growth will be at 8.7% according to the CSO, but FM optimistic India will attain 8.8% growth at least.
Finance Minister P Chidambaram is about to present the Union Budget for 2008-09 in Parliament. However, it remains to be seen if the belligerent Opposition political parties allow him to read out his Budget Speech in peace. There is uproar in the Lok Sabha and the Speaker Somnath Chatterjee is finding it difficult to control the members of parliament.
The FM has now begun his Speech.
PC hails Manmohan Singh as he begins his speech. Indian economy has recorded an over 8% growth for 12 successive quarters, says the FM.