 |
| |
|
|
|
 |
|
| |
|
The Union
Budget is finally out. Has it brought you benefits
or is it just another year of heavy taxation.
You can be the best judge with how the Finance
Minister’s planning has worked out for the
common man. Has it given you reasons to celebrate
or have your hopes got dampened? To find out,
take a quick glimpse at the snapshot presented
to you below. |
|
|
| Budget 2006-‘07
highlights |
| Indirect Taxes: |
|
| Customs: |
|
 |
Customs
duty peak rate reduced from 15% to 12.5% |
|
Custom duty
on alloy steel and primary & secondary
non-ferrous metals reduced from 10% to 7.5%
|
|
Duty on
mineral products reduced to 5% |
|
Duty to
be reduced on major bulk plastics like PVC,
LDPE and PP from 10% to 5%. |
|
Customs
duty on anti-AIDS, anti-cancer drugs cut to
5% |
|
CVD of 4%
to be imposed on all imports with a few exceptions |
|
Customs
duty on vanaspati increased to 80%. |
|
Reduction
of excise duty on all man-made fibre yarn
and filament yarn from 16% to 8%; |
|
Import duty
on all man-made fibres and yarns from 15%
to 10% |
|
|
| Excise: |
|
|
Duty on
aerated drinks and small cars reduced to 16%. |
|
8% duty
imposed on packaged software |
|
Customized
software and software packages downloaded
from the internet to be exempt; |
|
DVD Drives,
Flash Drives and Combo Drives to be fully
exempt from excise duty. |
|
Condensed
milk, ice cream, preparations of meat, fish
and poultry, pectins, pasta and yeast to be
fully exempt; duty on packaged and instant
food reduced from 16 % to 8 %. |
|
Duty on
footwear reduced from 16% to 8%. |
|
Concessional
rate of 8 % to be extended to all LPG stoves. |
|
Duty on
compact fluorescent lamps to be reduced from
16% to 8%. |
|
Glassware
to attract duty of 16 % on par with ceramic
ware and plastic ware. |
|
Excise duty
on specified printing, writing and packing
paper to be reduced from 16% to 12% |
|
Excise
duty on computers at 12% |
|
Duty of
16% to be levied on set top boxes with reduction
in customs duty from 15% to nil |
|
5% Excise
duty on cigarettes |
|
|
| Service tax: |
|
|
International
air travel, PR service, ATM operations, maintenance
and management; registrars, share transfer
agents and bankers will be under the service
tax net |
|
Leasing
and hire purchase to be treated on par with
loan transactions, interest and installment
of principal amount to be abated in calculating
value of the service. |
|
Increase in service
tax from 10% to 12%. |
|
|
| Direct Taxes: |
|
|
No change
in rates of personal income tax or corporate
income tax |
|
One-by-six
scheme will stand abolished. |
|
Marginal
revision in certain tax rates in the quest
for equity- Minimum Alternate Tax (MAT) rate
increased from 7.5% of book profits to 10%
|
|
25% increase
on all the rates of STT. |
|
Investments
in fixed deposits in scheduled banks for a
term of not less than five years included
in section 80C of the Income Tax Act; |
|
Limit of
Rs.10,000 in respect of contribution to certain
pension funds removed in section 80CCC subject
to overall ceiling of Rs.100,000. |
|
Definition
of open-ended equity-oriented schemes of mutual
funds in the Income Tax Act aligned with the
definition adopted by SEBI; open-ended equity-oriented
schemes and close-ended equity oriented schemes
to be treated on par for exemption from dividend
distribution tax. |
|
Exemption
under section 10(23G) removed. |
|
More transaction would
need Permanent Account Number (PAN) |
|
The following changes
will be viewed under Fringe Benefit Tax (FBT)
|
| |
| » |
FBT
reduced to 5% on ‘tour and travel’
|
| » |
FBT reduced to
5% from 20% |
| » |
Medical samples
excluded from FBT |
| » |
Brand ambassadors
excluded |
|
|
A threshold of Rs.100,000
under section 115WB(1)(c) so that only a contribution
by an employer to an approved superannuation
fund in excess of Rs.100,000 per year per
employee will attract FBT. Under section 80C
there is already exemption up to Rs.100,000
for contribution by an employee to an approved
superannuation fund. |
|
|
 |
|
|
|
|
 |
|
| |
| |
LIC has
launched a new policy-Amulya Jeevan (Plan No 177).
It is a pure term assurance without profit plan.
It provides financial security to the policyholder's
family (nominee) if he fails to survive the term
of the policy. |
|
Since
it is a pure term assurance plan, no survival
benefits will be given to the policyholder but
the plan performs the most crucial function of
insurance. A term assurance plan keeps you financially
protected for the duration chosen by you. Thus
the risk of premature death is fully covered to
the extent of the sum assured. Thus on the death
of the policyholder, your family will stay financially
protected. |
|
The minimum
age of entry to buy the policy is 18 years and
the maximum age is 60 years. For this plan, the
minimum sum assured is Rs 25 lakhs and there is
no upper limit on the maximum sum assured. Since
there is no restriction on the maximum sum assured,
you are free to choose the amount to insure yourself
and thus ensure maximum financial protection for
your loved ones. |
|
The policyholder
can insure himself for a minimum term of 5 years.
The maximum term made available under this policy
is 35 years. The policy comes with flexibility
in paying premiums. The premia can be paid on
a half yearly, yearly or on a single premium basis.
|
|
The merits
don’t end here. If for whatever reason you
have forgotten to pay your premiums (assuming
you have chosen half yearly/yearly mode of premium
payment), you get a grace period of 15 days. In
case of a lapsed policy, you can revive it within
a period of 5 years but before the date of maturity.
|
| |
|
|
|
|
|
 |
|
| |
|
Smile,
frown, disappointments are just a few emotions
that goes well to define the day when the Finance
Minister, P Chidambaram announced the budget.
People awaited the budget with a lot of expectations,
hoping no more tax imposition. But sadly, the
service tax was raised by 2%, raising the current
service tax level to 12%. The budget can be said
is a continuation of the last one, considering
the tax structure, which has remained the same.
So do you want to know how the budget has affected
you this year? Take a quick glimpse at it. |
|
|
|
| The tax structure has remained
unchanged. The table below indicates the taxable
amount: |
|
| Taxable
income |
Tax
payable (Slab) |
| Upto Rs 100,000 (Rs
1 lakh) |
Nil |
| From 1 lakh to Rs 1.5
lakhs |
10% |
| From 1.5 lakhs to Rs
2.5 lakhs |
20% |
| Above Rs 2.5 lakhs |
30% |
|
|
| Best time to buy a
vehicle: |
|
The Finance
Minister has cut the excise duty on small cars
and plans to make India a hub for small car manufacturing.
The excise duty has been brought down to 16% from
24%. The small cars here are defined as petrol
cars with engine capacity not exceeding 1200cc/diesel
cars with engine capacity not exceeding 1500cc
and having length not exceeding 4 metres. |
|
| Housing sector: |
|
| Good news for housewives,
a concessional rate of 8% is extended to all LPG
stoves. So the retail price of LPG will come down
by Rs 12 or Rs 13 per cylinder. |
|
| Fringe Benefits: |
|
The Fringe
Benefit Tax (FBT) had kicked up a huge controversy
when it was introduced and huge requests went
to the Finance Minister to make amendments or
erase the tax. Finally the Finance Minister had
to succumb to the requests. Now the contributions
made by an employer upto Rs 1 lakh per employee,
to an approved superannuation fund is exempt under
FBT. Also the distribution of medical samples,
payments to any person for promoting the sale
of goods and services, expenditure on free or
subsidized transport for the to and fro journeys
of employees from residence to office are now
out FBT ambit. |
|
| Section 80 CCC: |
|
Investments
in fixed deposits in scheduled banks for a term
of not less than five years are now included in
section 80C of the Income Tax Act; limit of Rs
10,000 in respect of contribution to certain pension
funds removed in section 80CCC are subject to
overall ceiling of Rs 100,000. |
|
| One-by-six Scheme |
|
The Finance
Minister has omitted the one-by-scheme wherein
the individual whose income being below the tax
exempt threshold limit had to fulfill one of the
six specified criteria. |
|
| Hike in Service Tax:
|
|
The Finance
Minister has hiked the Service Tax from the present
10% to 12%. New services like ATM operations,
maintenance and management; registrars, PR, management
services are now under the service net. |
|
The criticisms
echoing loud with the increasing tax rates, but
the Finance Minister has managed to pull through
it. He has been able to bring the GDP growth at
a notable 7% and now the new target set is 10%.
|
One needs
to keep in mind that the amount paid to the government
in the form of taxes is for the development of
our own nation. Every amount paid is utilized
for our benefits. It is we who enjoy the payback
in the form of better infrastructure, educational
institutions, hospitals, etc. So the next you
pay that extra amount, remember it will come back
to you |
|
 |
| |
|
|
| |
|
|
| |
Please do not
reply back to this mail. This is sent from an unattended
mail box.
Please mark all your queries / suggestions to webmaster@insuregain.com |
|
|
|
|
|
