Published On: Sun, Mar 6th, 2011

India Union Budget 2011-2012-Key Highlights

· I-T exemption limit raised to Rs 1.80 lakh from Rs 1.60 lakh .
· Exemption for senior citizens raised to Rs 2.5 lakh
· Tax under women slab unchanged.
· Tax exemption raised to Rs 5 lakh for senior citizens of 80 years.
· To increase service tax on air travel
· Excise and customs duty proposals to result in the net gain of Rs 7,300 crore.
· Export duty rates on iron ore unified and kept at 20% ad valorem.
· Basic customs duty on agricultural machinery reduced to 4.5% from 5%
· Basic customs duty on raw silk reduced from 30 to 5 per cent
· Excise and customs duty proposals to result in the net gain of Rs 7,300 crore
· Nominal one per cent central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery will be exempted.
· Peak rate of customs duty maintained at 10% in view of the global economic situation.
· Customs duty exemptions for hybrid auto parts.
· Nominal one per cent central excise duty on 130 items entering the tax net. Basic food and fuel and precious stones, gold and silver jewellery will be exempted.
· Standard rate of central exercise duty maintained at 10%.
· Central government debt in proportion to GDP will be 44.2% in 2011-12.
· 20% export duty on all grades of iron ore.
· Basic customs duty reduced on certain textile products
· No change in service tax rate of 10%.
· No change in central excise duty.
· Plan to levy 1% on 130 consumer items.
· Revenue deficit fixed at 2.3 per cent in revised estimates of 2010—11 and 1.8 per cent in 2011—12,
· Total plan expenditure will go up 100 per cent in nominal terms in the next year
· 15% tax on dividend for Indian cos from foreign unit.
· Direct Tax proposals result in expenditure of Rs 11,500 cr.
· To reduce surcharge on domestic companies to 5% from 7.5%
· MAT rate hiked to 18.5% from 18%.
· MAT on developers in SEZs to be levied.
· Fiscal deficit revised to 5.1% from 5.5% for FY’11
· Total expenditure raised by 13.4% at Rs 12.57 lakh cr over budget estimates
· Gross tax receipts estimated at 9.32 lakh cr for FY 2011-12
· Bill to amend India Stamp Act soon.
· Budget allocation of Rs 100 cr for Ladakh and Rs 150 cr for Jammu for implementation of projects identified by taskforce
· Old age pension to persons of over the age of 80 raised from Rs 200 to Rs 500
· Health allocation up by 20% to R 27,600 cr.
· Rs 9- lakh ex-gratia for defence personnel for 100% disability fighting Left-wing extremism.
· To set up 15 more mega food parks.
· Remuneration of anganwadi workers raised from Rs 1,500 to Rs 3,000 per month. Helpers to get Rs 1,500 from Rs 750
· Tax free bonds of Rs 30,000 cr to be issued for infrastructure development. This will cover Warehousing Corporation, NHAI, IRFC and Hudco.
· Allocation under Rashtriya Krishi Vikas Yojana to be raised from Rs 6,755 crore in the current year to Rs 7,860 crore.
· Rs 50 cr grant to Aligarh Muslim University centres in Murshidabad in West Bengal and Malappuram in Kerala.
· Rs 200 cr for environmental remediation programme.
· Age for pension eligibility reduced from 65 years to 60 years under Indira Gandhi Yojana scheme
· To move insurance, pension and banking bills in Parliament
· Rs 500-cr for National Development Fund.
· Rs 400-cr as one-time grant for IIT-Kharagpur.
· Move to set up State Innovation Councils underway.
· Allocation to education sector raised to Rs 52,000 cr
· Scholarship scheme for SC/ST students in classes iX, X.
· Increase in allocation to higher education
· Increase in remuneration for Anganwadi workers from Rs 1,500 to Rs 3,000 per month.
· Plan 17% increase in social sector spending.
· To introduce Food Security Bill
· Tax free bonds of Rs 30,000 cr to be issued for infrastructure development. This will cover Warehousing Corporation, NHAI, IRFC and Hudco.
· Fertiliser industry to be included under infrastructure category.
· New companies bill to be introduced.
· GoM to be set up to deal with corruption
· Five-fold strategy to deal with black money.
· Mega cluster for leather products to be introduced.
· Existing interest subvention scheme on short term farm loans at 7 % interest to continue.
· Self-assessment in customs to be introduced.
· Credit flows to farmers raised from Rs 3.75 lakh crore to Rs 4.75 lakh crore.
· Constitution Amendment Bill for introduction of GST in this session.
· Goods and Services Tax Bill this year.
· Direct Taxes Code Bill likely to be passed by Parliament next financial year after getting Standing Committee report.
· Public Debt Management Agency Bill in the next fiscal.
· Indian mutual funds to get direct access to foreign markets; FIIs to be allowed to invest in MFs.
· To liberalise FDI policy further.
· To extend infra tax breaks to fertiliser sector.
· To set up microfinance equity fund.
· Government to move towards direct cash transfer of cash subsidy as regards kerosene, LPG and fertilisers from March 2012 for BPL in view of large diversion.
· 3% interest subvention to farmers who repay in time.
· Nabard capital base to be increased by infusing Rs 10,000 cr
· Rural housing fund increased to Rs 3,000 cr
· Banks asked to step up lending to agriculture.
· Allocation under Rashtriya Krishi Vikas Yojana to be raised from Rs 6,755 crore in the current year to Rs 7,860 crore.
· Budget proposes to raise housing loan limit from Rs 20 lakh to Rs 25 lakh for priority sector lending.
· Allocation for farm development hiked to Rs 7,860 cr.
· Rs 300 cr proposed to promote production of cereals.
· Indian micro-finance equity with SIDBI to be formed at Rs 100 crore.
· Rs 6,000 cr to be given to public sector banks to maintain capital-to-risk assets ratio norms
· RBI to bring in new guidelines for banking licences.
· Aiming Fiscal deficit of 3% by fiscal 2014
· Central electronic registry to reduce fraud cases.
· FII investment limit for infra corporate bonds hiked to $40 billion.
· Discussions on to further liberalise FDI policy.
· Preparation of GST rollout in final stages.
· Microfinance equity fund of Rs 100 cr proposed.
· Govt committed to hold 51% in PSUs.
· Rs 3,000 cr to Nabard for handloom societies.
· Women self-help group development fund to be set up.
· Direct transfer of subsidy for kerosene.
· Goods and Services Tax Bill to be introduced in Parliament this year.
· Direct Tax Code Bill likely to be passed by Parliament next financial year after getting Standing Committee report.
· Disinvestment target at Rs 40,000 cr.
· Direct Tax Code from April 2012.
· SEBI-registered MFs to be allowed direct access to foreign funds.
· Expect RBI to moderate inflation.
· Public Debt Management Agency Bill to be introduced next financial year.
· Current account deficit and average inflation in 2011-12 likely to be less than current year.
· FDI policy review done in Sept 2010.
· Economic growth in 2011-12 likely to be 9 per cent.
· Admits large-scale diversion of kerosene.
· Introduction of DTC will be a watershed moment.
· Debt managment bill to be introduced.
· Constitutional Amendment Bill on GST to be introduced.
· Expect agri sector to grow at 5.4% in 2011.
· Growth in 2010-11 broad-based.
· Economy resilient to shocks.
· RBI measures will further moderate inflation.
· GDP estimated growth at 8.6% in real terms.
· New dynamism in rural economy.
· Core inflation in check.
· Current account deficit is at 2009-10 levels, and is a matter of concern.
· Huge difference in wholesale and retail prices not acceptable.
· Total food inflation down from 20.2 per cent last year to 9.3 per cent in January  2011

·Revival in private investment should be sustainable.

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