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New Budget here, but funds of old one still unspent

  Ten ministries had not spent even halfof what was given to them last year tillDecember 2015, that is, in nine months !t the

other e"treme are seven ministries that hadspent over #0$ of their funds although onefourth of the year was still remaining These%gures refer to &lan spending, which does notinclude payments of salaries, pensions andother recurring e"penditures 't includes allcapital e"penditure

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BUDGET & BOURSE: HOW FMs SWAYED

THE MARKETS

The sensex's path is one of the quick measures of investor sentiment to Budgets.

Here's how the index reacted to six FMs' proposals in the last 2!ears "

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('ncome ta" rates moderate in'ndia)

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Government Slaps Levy On New CarSales To Fight Pollution

'n his annual *nion Budget, +inance inister !run -aitley imposed a saleslevy of up to . per cent on new passenger vehicles, e/ectiveimmediately, spurring a sello/ by investors in auto stocs lie arutiu3ui 'ndia 4td and Tata otors

 The budget proposes a 1 per cent ta" on cars less than four metres inlength and with engines smaller than 1200cc that run on petrol, liui%edpetroleum gas or compressed natural gas

mall diesel cars less than . metres long and with engines below 1500ccwill be ta"ed at 25 per cent and bigger diesel vehicles at . per cent

't is estimated that the ta" will generate 7s 8,000 crore in revenue forthe government

 The government, separately, plans to levy a lu"ury ta" of 1 per cent onsales of passenger vehicles priced higher than 7s10 lah

9hile increasing ta"es, 'ndia is also e"pected to spend 7s#:,000 croreover the ne"t %scal year on improving and building new roads andhighways, which car maers say could partially o/set the negative

impact

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Defence Buget For F!"#

  The defence budget for 201;1: was increased by #:; percent to 7s 25< lah crore as compared to the revised estimatesof 7s 288 lah crore for 20151; even as military pension 3oomedto 7s umped to 7s

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$%&L %ST&T%

   The Budget 201;1: has proposed anadditional 7s 50,000 deduction on intereston loans for %rst home buyers and 100 per

cent deduction for pro%t on development ofa/ordable housing, besides e"empting7?'Ts from dividend distribution ta"

  The +inance inister has taen theright steps to boost housing sector andensure that )@ousing for !ll by 2022)becomes reality, he added

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'NF$&ST$(CT($%

  'ndia)s infrastructure output grew2# per cent in -anuary compared with

28 per cent a year ago, governmentdata showed on onday

  'nfrastructure accounts for nearly8< per cent of 'ndia)s industrial output

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Lower ta) on patent income to*oost $+D

   The Budget has introduced a specialAroyalty ta" which lowers the e/ective

rate of ta" on income earned frompatents The ob>ective is to encourageindigenous 7CD, and to mae 'ndia an

innovation hub

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New ivien ta) may not hitpromoters much

 The government has not removed or reducedthe Dividend Distribution Ta" DDTE borne bycompanies paying the dividend, which stands

at 20$ The additional 10$ ta" on dividendincome announced in the Budget would notpinch many wealthy promoter groups afterall &romoters of several blue chips hold only

a small stae in their individual capacity,through @*+s C partnership %rms controlledby them, which come under the new ta"

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Fos rush to pay dividendto beat change in ta" rule

  The change in the ta"ation policy for

 dividends has prompted companies to rush and

 o/er interim dividends to reduce ta" liability

 of promoters, at least for a year, since they will now have to face thelevy from !pril 1

  GThose promoters who will be at the receiving end of thisannouncement are liely to encourage companies to declare higherdividends before arch 81, 201; The companies with high promotershareholding will also prefer advancing dividend payouts and may pay

most of it before arch 81, 201; so that they do not end up paying10$ ta" on their dividend income This could lead to a rise in dividenddistribution in the ne"t one month That once the 10$ additional ta"comes into e/ect, companies may avoid declaring high dividends andmay opt for the more ta"e/ective buybac option

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(Hoogle ta")I Hovt must balance earning ta" with

attracting bi3

  'ndia has taen the %rst step to ta" the digital

economy G!t present, the intent is to levy ;$ onlyon online advertisement payments e"ceeding 7s

1lah

  The levy will impact the bottom lines of giants

such as Hoogle, Jahoo and others, which earn adrevenue from business entities in 'ndia 'nprofessional ta" circles, it has been dubbed (Hoogleta")

 

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For small *i, + professionals- a way tosave money- an a ta) heaache

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 !ear Sense)Close Day

&fterBuget

Changein points

201; 28::# :::

2011 1

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$upee 0umps 12p- year.s*iggest gain

   The rupee registered the years biggestsingleday gain of 5; paise to close at a nearlythreewee high of ;:

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%)peniture3 (P&/'' + ND&/''

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 Ta) $evenues3 (P&/'' + ND&/''

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Buget &llocations on Select 4eas

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