Finance minister, P. Chidambaram presented his 8th and India’s 82nd Union budget on 28th February 2013. Key Highlights:
* No change in slabs and rate for personal income tax.
* Tax credit of Rs 2000 to be provided to every person to having income of up to Rs 5 lakh, this will benefit 1.8 crore people. * 5 to 10 per cent surcharge on domestic companies whose taxable income exceeds Rs 10 crore. * Commodities transaction tax levied on non-agriculture commodities futures contracts at 0.01 per cent. * No change in peak rate of customs duty for non-agriculture products. * Import duty raised on set-top boxes from 5 to 10 per cent to safeguard interest of domestic producers. * Education cess to continue at 3 per cent.
* Import duty raised from 75 to 100 per cent on luxury vehicles. * Duty free limit on gold raised to Rs 50,000 in case of male and Rs 100,000 in case of female. * Specific excise duty on cigarettes and cigars raised by 18 per cent. * Excise duty on SUVs to be increased to 30 per cent from 27 per cent, SUVs registered as taxis exempted. * Vocational courses offered by state-affiliated institutes to be exempted from services tax. * Duty on mobiles above Rs 2,000 raised from one to six per cent, based on their maximum retail prices. * Service tax to be levied on all a/c restaurants.
* One time voluntary compliance scheme for service tax defaulters to be introduced. Interest and penalties to be waived. * Direct tax proposals to yield Rs 13,300 crore, indirect tax proposal to give Rs 4,700 crore. * Fiscal deficit will be 5.2 per cent in current year and 4.8 per cent in the next fiscal.
Impact Of Budget On Social Sector:
* Rs. 27,258 crore provided for Sarva Shiksha Abhiyaan (SSA). * An increase of 25.6 per cent over RE of the current year for investments in Rashtriya Madhyamik Shiksha Abhiyan (RMSA). * Rs. 5,284 crore allocated to Ministries/Departments in 2013-14 for scholarships to students belonging to SC, ST, OBC, Minorities and girl children.
Finance minister Chidambaram has allocated Rs 65,867 crore to the ministry of human resource development (MHRD) — an increase of 17 per cent compared to last fiscal year 2012-13.
While allocations for education sector have increased significantly, overall expenditure performance has been weak with a large portion of allocated funds remaining unutilized. Funds are released only at the end of the year due to which the funds cannot be effectively utilized.
Political decentralization must be supported by financial decentralization. Once the fund is parked in the ministry, schemes and programmes must be immediately clocked so that fund flow is made available to the local self government bodies within a month
The focus on Sarva Shiksha Abhiyan is not enough. Aspirations for higher education have enhanced exponentially among Indian Youth. Government aided higher education and vocationalisation of education is the need of the hour.
* Mid Day Meal Scheme (MDM) to be provided Rs. 13,215 crore. * The Integrated Child Development Scheme has been allocated 17,700 crore in 2013-14, representing an increase of 11.7 percent, from Rs 15,850 crores. * Allocation of funds for Drinking water and Sanitation
* Eligibility conditions for life insurance policies of persons suffering disabilities and certain ailments to be liberalized. * Extension of Rashtriya Swasthya Bima Yojana (RSBY) to other categories.
The scope of Rashtriya Swasthya Bima Yojna (RSBY) has been expanded to widen its coverage, to include rag pickers, rickshaw pullers, taxi and autorickshaw drivers, miners, sanitation workers and toddy workers which is also expected to have an impact in improving access to healthcare for the marginalized section of the society. Public expenditure on health in India is...