Please welcome, an entirely different kind of post on the bug. Well, I’m trying 🙂
While everyone was expecting a big bang reform budget this year, Finance Minister Arun Jaitley brought out what I’d call a growth oriented budget. I’d not go out and call it an excellent one, but this sure was a good budget with some of the much awaited reforms. Here are a few of the highlights and takeaways:
- The Fiscal deficit seen at 3.9 percent of GDP, the fiscal target of 4.1 % to be met.
- Revenue deficit at 2.8 percent while the current account deficit at 1.3 %
- GDP growth rate seen between 8-8.5%.
- A target of USD 6.7 billion set for stake sales in the coming financial year. The same revised at USD 5 billion for the current year.
- Inflation seen close to 5%.
- Planned and non-planned expenditures at 4.6 and 13.1 trillion rupees respectively.
- Major subsidies including Fuel, food and fertilizer estimated at 2.3 trillion rupees.
- Defense budget upped to 2.5 lakh crore rupees.
- FMC to be merged with SEBI, big news for the commodity markets.
- Wealth tax to be abolished!
- Proposal of new universal social security system and a new law on black money.
- 347 billion rupees allocated to Rural Employment guarantee scheme (Something that was the sign of the previous government’s failure according to the PM’s recent speech)
- IIT status to ISM Dhanbad, 2 new IIMs announced for J&K and Andhra Pradesh.
- National investment infrastructure fund to be set up.
- A student financial aid authority to be set up and a number of excise duty cuts announced to promote entrepreneurship and create jobs.
- Yoga included as a charitable purpose in the Income tax act. (Something that our PM applauded more than anyone else)
- Banks to fund small entrepreneurs, laws to be made to improve the ease of business.
For the common man:
- Health insurance premium reduction limit increased from 15 to 25,000. (30000 for Senior citizens)
- Additional deduction of 50000 allowed under the NPS.
- Pradhanmantri Suraksha Bima Yojna launched to provide life insurance at nominal costs.
- EPF made optional for low earning individuals while choice between NPS and EPF provided to others.
- Service tax hiked to 14%.
The Union budget 2015-16 was not a bundle of please-all announcements, which can be looked at as both a good and a bad thing. While some of the highly expected announcements weren’t made, many decisions were taken which may sound absurd now but will surely prove to be decisive in the country’s development.
Where will you need to pay more?
If you are a medium earning IT employee who likes to smoke and use high-end gadgets, this budget was more of a disappointment for you than anything else. Cigarettes, Smartphones, Imported Cars, Dining at restaurants, Set top boxes, Parking fees and airline tickets are supposed to be more expensive after this budget.
Where do I pay less?
Thankfully, for the poorer sections of the society, the budget wasn’t all bad. If you’re looking to buy a TV or a computer, or branded clothes, you will probably save more now. Higher education and starting a new business venture should also be easy on a common man’s pocket now.
Summary: I’m no one to judge, but I’d give this budget a 7.5/10. Although some announcements like the 100,000 KMs of roads and the ambitious target of 60,000,000 toilets under the clean India movement did sound appealing, probably worth an 8.5, the no change in tax slabs part hurt me bad. Although some measures are taken to provide relaxations to taxpayers, as I said, they don’t seem helping someone who earns 4-8 LPA and has to spend half of it maintaining a decent life standard (aka, most graduates).
PS: I did miss a few numbers while watching the budget and had to take the help of Moneycontrol and Economic Times to get the same. In case you find any mistakes, feel free to point out.
PPS: Although I don’t like the politicians making remarks at each other in the parliament, this was worth a laugh:
“Kuch to gul khilaye hain, kuch abhi khilane hain, par baagh mein ab bhi kaante kuchh puraney hain,” (We have made some progress and are working towards achieving more goals, but there are some hindrances in the way) (Courtesy: NDTV Profit)