Uhttp://www.jagranjosh.com/current-affairs/union-budget-201213-tax-proposalshttp://planningcommission.nic.

in/ 1331982046-1nion Railway Minister Mukul as proposed by Dinesh Trivedi

Roy rolled back the Railway Fare Hike

Union Railway Minister Mukul Roy rolled back the railway fare hike as proposed by Dinesh

Trivedi in the first Union Rail Budget 2012-13 presented on 14 March 2012.
Roy also struck down the plan to restructure Railway Board.

Roy withdrew the hike for second class suburban

and non-suburban, and sleeper class travel fare by 2 paise, 3 paise and 5 paise per km. He also rolled back the hike of 10 paise per km for travel in AC chair car and AC 3-tier fare stating the middle class
would be hit severely by such hike in fares. The hike announced by Roys predecessor Trivedi was the first instance in 9 years when the fares had been raised. All railway reform measures suggested by Trivedi such as setting up of an independent tariff regulator, restructuring of Railway Board on professional lines, and creation of posts of Member PPP and Member Safety was also ignored in the latest budget tabled by Roy.

Roy's budget paved the way for the cash-strapped railways to earn a mere Rs

300 crore from

increased passenger fares instead of Rs 7200 crore that Trivedi budgeted for.

Trivedi's proposal to hike fares was estimated to generate additional revenues of Rs 6500 crore. However, following the rollback proposed by Roy the railways can now generate only Rs

1000 crore more.

Mukul Roy took charge as the Union Railway Minister on 20 March 12 following the resignation of Dinesh Trivedi. Trivedi was forced to resign after he raised rail passenger fares in Union rail Budget 2012-13 and thus angered Trinamool his proposal to increase fares in the railway budget

Congress particularly

Mamata Banerjee. West Bengal Chief Minister Mamata Banerjee was opposed to

Prices of Protein Items, Edible Oil Products pushed Retail Inflation to 8.83% in February 2012
According to data released by the government on 19 March 2012, retail

inflation stood at

8.83% in February 2012 as a result of higher prices of protein based items, edible oil
products and manufactured goods. In February 2012, the Consumer Price Index (CPI), measured by changes in retail prices remained high as compared to the rate of price rise in the wholesale market. Retail inflation, based on CPI was 7.65% in January 2012. Retail inflation in January 2012 had stood at 7.56 per cent.

Retail prices of egg, meat and fish rose by 10.62 per cent in February 2012 while milk and its products turned costlier by 15.76 per cent, year-on-year. Pulses and products saw a rise of 4.17 per cent. Price of fuel and light, and clothing, bedding and footwear segments were all registered in double-digits. Inflation in the oil and fat category went up by 12.76 per cent and condiment spices shot up by 8.68 per cent on an annual basis.

However cereals and products reported a moderate rate of price rise at 2.40 per cent. Only vegetable prices among other items saw a decline of 4.73 per cent over the February 2011 level.

The inflation rates for rural January 2012.

and urban areas in February 2012 were 8.36% and

9.45% in February 2012. Retail inflation in rural and urban areas was 7.28% and 8.25% in

The all India CPI

is prepared by the ministry of labour in addition to the

three retail price indices for 1agricultural labourers, 2 rural labourers and 3 industrial workers.

Jharkhand, Mizoram, Sikkim and Lakshadweep Signed MoU Under the ISSP

Share| Four States namely Jharkhand, Mizoram, Sikkim and Lakshadweep on 16 March 2012 signed MoU with the Ministry of Statistics and Programme Implementation under the Indian Union Territories.

Statistical Strengthening Project (ISSP) for the States and

ISSP is aimed at strengthening State Statistical Systems by way of providing adequate technical and financial support to improve their statistical capacity and infrastructure. ISSP is a very important and a comprehensive project of Ministry of Statistics & Programme Implementation, with an approved outlay of about 650 Crore rupees, out of which 80% has been funded through World Bank Loan and 20 percent is being borne by the Government of India.

12th five year plan objective FSMIC Faster,sustainable and more inclusive growth submitted on oct 2011

Union Budget 2012-13:

Direct Tax Code(DTC) --------------Direct taxes (income tax) Goods & Services Tax (GST) ------------- Indirect taxes.

Budget Estimates --------- 2012-13,

Gross Tax Receipts
15.6

10,77,612 c

10.8 L

^ Budget E

19.5

^------------- 2011-12.
7.7 L 1.6 L
.4 L

Net tax to the Centre 7,71,071. Non Tax Revenue Receipts. 1,64,614 Non-debt Capital Receipts

41650 .

The total expenditure B ... 14,90,925

Plan Expenditure ...5,21,025 Non Plan Expenditure.. 9,69,900
The budget stated that individual income upto

15 L 5 10 L L

2 lakh rupees

will be free from

5 lakh rupees and upto 10 lakh tax at the rate of 20 %.

Direct Taxes:
Exemption limit for the general category of individual taxpayers proposed to be enhanced from 180000 rupees to 200000 rupees giving tax relief of 2000 rupees. Upper limit of 20 per cent tax slab proposed to be raised from 8 lakh rupees to 10 lakh rupees. Proposal to allow individual tax payers, a deduction of upto 10000 rupees for interest from savings bank accounts. Proposal to allow deduction of upto 5000 rupees for preventive health check up. Senior citizens not having income from business proposed to be exempted from payment of advance tax. To provide low cost funds to stressed infrastructure sectors, rate of withholding tax on interest payment on ECBs proposed to be reduced from 20 per cent to 5 per cent for 3 years for certain sectors. Restriction on Venture Capital Funds to invest only in 9 specified sectors proposed to be removed. Proposal to continue to allow repatriation of dividends from foreign subsidiaries of Indian companies at a lower tax rate of 15 per cent upto 31.3.2013. Investment link deduction of capital expenditure for certain businesses proposed to be provided at the enhanced rate of 150 per cent. New sectors to be added for the purposes of investment linked deduction. Proposal to extend weighted deduction of 200 per cent for R&D expenditure in an in house facility for a further period of 5 years beyond 31 March 2012. Proposal to provide weighted deduction of 150 per cent on expenditure incurred for agriextension services. Proposal to extend the sunset date for setting up power sector undertakings by one year for claiming 100 per cent deduction of profits for 10 years. Turnover limit for compulsory tax audit of account and presumptive taxation of SMEs to be

raised from 60 lakhs rupees to 1 crore rupees . Exemption from Capital Gains tax on sale of residential property, if sale consideration is used for subscription in equity of a manufacturing SME for purchase of new plant and machinery. Proposal to provide weighted deduction at 150 per cent of expenditure incurred on skill development in manufacturing sector. Reduction in securities transaction tax by 20 per cent on cash delivery transactions. Proposal to extend the levy of Alternate Minimum Tax to all persons, other than companies, claiming profit linked deductions. Proposal to introduce General Anti Avoidance Rule to counter aggressive tax avoidance scheme. Measures proposed to deter the generation and use of unaccounted money. A net revenue loss of 4500 crore rupees estimated as a result of Direct Tax proposals. Given below are the major provisions under the Indirect Taxes Service Tax Sevice tax confronts challenges of its share being below its potential, complexity in tax law, and need to bring it closer to Central Excise Law for eventual transition to GST. Overwhelming response to the new concept of taxing services based on negative list. Proposal to tax all services except those in the negative list comprising of 17 heads. Exemption from service tax is proposed for some sectors. Service tax law to be shorter by nearly 40 per cent. Number of alignment made to harmonise Central Excise and Service Tax. A common simplified registration form and a common return comprising of one page are steps in this direction. Revision Application Authority and Settlement Commission being introduced in Service Tax for dispute resolution. Utilization of input tax credit permitted in number of services to reduce cascading of taxes. Place of Supply Rules for determining the location of service to be put in public domain for stakeholders comments. Study team to examine the possibility of common tax code for Central Excise and Service Tax. New scheme announced for simplification of refunds. Rules pertaining to point of taxation are being rationalised. To maintain a healthy fiscal situation proposal to raise service tax rate from 10 per cent to 12 per cent, with corresponding changes in rates for individual services. Proposals from service tax expected to yield additional revenue of 18660 crore rupees. Other proposals for Indirect Taxes Given the imperative for fiscal correction, standard rate of excise duty to be raised from 10 per cent to 12 per cent, merit rate from 5 per cent to 6 per cent and the lower merit rate from 1 per cent to 2 per cent with few exemptions. Excise duty on large cars also proposed to be enhanced. No change proposed in the peak rate of customs duty of 10 per cent on nonagricultural goods.

To stimulate investment relief proposals for specific sectors - especially those under stress.

Agriculture and Related Sectors Basic customs duty reduced for certain agricultural equipment and their parts; Full exemption from basic customs duty for import of equipment for expansion or setting up of fertiliser projects upto 31 March 2015. Infrastructure Proposal for full exemption from basic customs duty and a concessional CVD of 1 per cent to steam coal till 31 March, 2014. Full exemption from basic duty provided to certain fuels for power generation. Mining Full exemption from basic customs duty to coal mining project imports. Basic custom duty proposed to be reduced for machinery and instruments needed for surveying and prospecting for minerals. Railways Basic custom duty proposed to be reduced for equipments required for installation of train protection and warning system and upgradation of track structure for high speed trains. Roads Full exemption from import duty on certain categories of specified equipments needed for road construction, tunnel boring machines and parts of their assembly. Civil Aviation Tax concessions proposed for parts of aircraft and testing equipment for third party maintenance, repair and overhaul of civilian aircraft. Manufacturing Relief proposed to be extended to sectors such as steel, textiles, branded readymade garments, low-cost medical devices, labour-intensive sectors producing items of mass consumption and matches produced by semi-mechanised units. Health and Nutrition Proposal to extend concessional basic customs duty of 5 per cent with full exemption from excise duty/CVD to 6 specified life saving drugs/vaccines. Basic customs duty and excise duty reduced on Soya products to address protein deficiency among women and children. Basic customs duty and excise duty reduced on Iodine. Basic customs duty reduced on Probiotics. Environment Concessions and exemptions proposed for encouraging the consumption of energy-saving devices, plant and equipment needed for solar thermal projects. Concession from basic customs duty and special CVD being extended to certain items

imported for manufacture for hybrid or electric vehicle and battery packs for such vehicles. Proposal to increase basic customs duty on imports of gold and other precious metals. For more information on economic survey & budget Click here