BUDGET 2011-12

OVERVIEW OF THE ECONOMY    Gross Domestic Product (GDP) estimated to have grown at 8.5.4% Industry .1% Services . Economy has shown remarkable resilience. .6% Continued high food prices have been principal concern this year. In 2010-11.9.Growth Agriculture.8.6 per cent in 2010-11 in real terms.

Consumers denied the benefit of seasonal fall in prices despite improved availability of food items.4 per cent.6 per cent during April to January 2010-11 over the corresponding period last year. revealing shortcomings in distribution and marketing systems.   Exports have grown by 29. Monetary policy measures taken expected to further moderate inflation in coming months. . while imports have recorded a growth of 17.

PROJECTIONS    Revised GDP growth estimate for 2010-11 is 8. to further reduce the fiscal deficit to 3.6% & for FY at 8. Fiscal Deficit for FY11 seen at 5.has indicated that preparations for GST rollout are in final stages and the bill will be introduced in the current session. DTC to come in force in April 2012.1% of GDP and target for the next year seen at 4.6%. .75%-9.25%.5% by FY14.

8L-5L 10% Rs.80.DIRECT TAX REFORMS Men Tax exemption limit – Rs.8L 20% Above 8L 30%  For women the tax slabs remain the same.1.  .1.000 Rs.5L.

5L .2.5L-5L 10% Rs.Senior Citizens (Age 60-80) Up to Rs. 5L-8L 20% Above Rs.2.8L .5L-8L .30%  .5L.8L 30% Very Senior Citizens (Age 80yrs & above) Up to Rs.Nil Rs.20% Above Rs.Nil Rs.

Corporate Tax stands the same i.e 30%  Surcharge: 7.5% to 2% for Foreign Co.20. In order to promote savings & an additional deduction of Rs.  MAT has been increased from the current rate of 18% to 18.000 was permitted  .5%. MAT shall be levied on developers of SEZ’s and operating units of SEZ’s. 2.5% to 5% for Domestic Co.

 Dividends received from foreign subsidiary shall be taxed at 15% to encourage its inflow in India.This additional deduction is proposed to be extended for 1 more year. .

12.25.729 cr.1% of GDP.Rs. 6. 9. This year estimate is 4.1.5% to 5.  The Gross Tax receipts .32.57.  Non Tax Revenue Receipts-Rs.435 cr.57.440 cr. 12.000 cr.Rs.  Total Proposed Expenditure – Rs. In 2010-11 the Fiscal Deficit has been brought down from 5.  Net Tax Receipts .6% of GDP  .BUDGET ESTIMATES 2011-12 The total Budget outlay is Rs.457cr.64.

3% higher than last year.14. .000 cr has been provided for infrastructural development in 2011-12. which is 23. 5000 cr to Rs.INFRASTRUCTURE DEVELOPMENT On the infrastructure front.  The budget of IIFCL has been raised from Rs.2.  . an allocation of Rs.25000cr.

 Base rate on excise duty raised to 5%  1% Excise duty on 130 new items  Mandatory levy of 10 pct on branded garments  .INDIRECT TAXES Basic customs duty on agricultural machinery reduced to 4.5 per cent from 5 per cent  Service tax unchanged at 10 per cent.

2-4%)  Construction: FII limit for investment in corporate infrastructure bonds has increased from $5 bn to $25 bn  Fertilisers: Marginally Positive due to additional agriculture sredit.  .OVERALL SECTORAL IMPACT Cement: Negative impact due to increase in excise duty (apprx.

 Power: Domestic equipment manufacturers for MPP’s & UMPP’s have been exempted on Central Excise Duty  .Hotel : Negative due to levy of 5% service tax on room accomodation & 3% service tax on restaurants.  IT (SEZ): Negative because of levying of MAT on SEZ.  Housing: Positive due to Priority sector lending limit for housing loans increased from Rs.20 L to Rs. 25 L.

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