INDIAN UNION BUDGET

2011-2012
HIGHLIGHTS
- -Printers
-Paper
-Soap
Dearer -Steel
-Diapers &
Sanitary napkins
-Legal Services -Homoeopathic
Medicines
-Healthcare in -Yarn/raw silk
top – end Pvt. -Mobile Phones
hospitals. -Agarbatti
-Solar Lantern,
-Branded Cloths LED Lights
-Battery Driven-
-Gold Vehicles
-Agriculture
-A/c restaurants machinery
serving Liquor
Cheaper
-Hotel Services
DIRECT TAXES
CORPORATE TAX
 The Direct Taxes Code is likely to be effective from 1 April 2012
 The Corporate tax,Firms,Local authority, Co operative Societies rate
remains unchanged
 The basic rate of MAT increased to 18.5% from 18 %
 The surcharge for domestic companies reduced to 5% from 7.5 %
 The surcharge Non domestic companies reduced to 2 % from 2.5 %
 NEW INCOME-TAX return form called Sugam to be introduced for small
business.
 Salary earners having an income of less than ` 5 lakh is exempted for filing
income tax return from this year.
 Provision for tax-free infrastructure bonds extended by 1more year
 TAX HOLIDAY for IT companies finally ends Levy MAT on developers of SEZ
and units operating in them.
 Levy Alternative Minimum Tax (AMT) in the case of Limited Liability partnerships
at 18.5%
 Money market and debt funds will pay a higher dividend Distribution tax (DDT) for
investment made by firms.
 DDT will rise to 30% from 25% but stay unchanged at 12% for individual investors.
 The TDS structure & rates remains unchanged

 Above rules are made effective from 01.04.2011

PERSONAL TAXATION
 For MEN
Current Slabs (`) Proposed Slabs (`) Basic rate of tax
Upto160,000 Upto180,000 Nil
160,001to500,000 180,001to500,000 10%
500,001to800,000 500,001to800,000 20%
Above800,001 Above800,001 30%

For WOMEN
No change in tax Structure
Upto190,000 Upto190,000 Nil
190,001to500,000 190,001to500,000 10%
500,001to800,000 500,001to 800,000 20%
Above800,000 Above800,000 30%
FOR SENIOR CITIZEN (60-80YEARS)
Age for eligibility reduced from 65 years to 60 Years

Upto 240,000 Upto 250,000 Nil

240,001to500,000 250,001to500,000 10%
500,001to800,000 500,001to800,000 20%
Above800,001 Above 800,001 30%

For Senior Citizen (80years & above)

Hike in exemption limit to ` 5 lakh will result on big gains

Upto 240,000 Upto 500,000 Nil

240,001to500,000 - 10%
500,001to800,000 500,001to800,000 20%
Above 800,001 Above 800,001 30%
 CENTRAL
EXCISE
 Central Excise Duty to be maintained as 10% only (un changed)
 Nominal Central Excise Duty of 1 % without Cenvat credit facility is being imposed
on 130 items entering in the tax net.
 Lower rate of Central Excise Duty enhanced from 4 % to 5 %
 Optional levy on branded garments or made up proposed to be converted into a
mandatory levy at unified rate of 10 per cent.
 Labelled jewellery and Precious metals attract 1% excise duty.
 Excise duty on sanitary napkin, baby & clinical diapers and adult diapers is being
reduced from 10% to 1% with no cenvat credit.
 Concessional rate of excise duty for Hydrogen / hybrid vehicle.
 Exemption withdrawn on HD drive, CD/DVD drive,& writers, Flash memory,
Combo drives meant for fit inside of CPU or Laptop will attract 5% of concessional
excise duty .

Changes come into effect immediately unless otherwise specified.

 SERVICE TAX
 Service tax rate remains unchanged at 10 percent as a pre-cursor to GST
 Legal Cases will also become a costly affair to cover all legal consultations, except
individual to individual ,under service tax net.
 Hotel accommodation in excess of ` 1,000 per day will come under the ambit of
tax ,although there will be an abatement of 50%
 service provided by air conditioned restaurants that have license to serve liquor
added as new services for levying Service Tax at 3- 5%. After an abatement of 70%
 Tax on all services provided by hospitals with 25 or more beds with facility of
central air conditioning at the rate of 5%
 Service Tax on air travel raised from ` 100 to ` 150 in the case of domestic air travel
and ` 500 to ` 750 on international journeys by economy class.
 The domestic air travel on higher classes will be taxed at the standard rate of 10%
 Services provided by life insurance companies in the area of investment and some
more legal services proposed to be brought into tax net.

 Above rules are made effective from 01.04.2011

 CUSTOMS DUTY
 Basic customs duty on agricultural machinery reduced to 4.5 per cent from 5 per
cent
 Basic customs duty on raw silk reduced from 30 to 5 per cent.
 Basic customs duty on solar lantern or lamps reduced from 10 to 5%
 CVD exempted fully on LEDs used for manf of LEDs light & fixtures.
 Fully exemption from basic custom duty is being extended battery charger, hands
free, head phones and PC connectivity cable of mobile handset including cellular
phones.
 Basic customs duty on bamboo used for manf of agarbattis is being reduced from
30% to 10%
 The government has added a fixed excise duty of ` 160 per tonne on cement and
reduced custom duty on petcoke and gypsum, key inputs for the sector.

 Changes come into effect immediately unless otherwise specified.

 GOODS AND SERVICE TAX

 GST proposed to be rolled out from April 2012

 Several proposals under the existing tax regime should facilitate a move to
wards GST:
 Focus on building robust IT infrastructure
 Further rationalization of rates under Excise and Customs
 Central sales tax
 No Changes in CST act 1956
THANK YOU