India Budget 2011-12: Highlights

Following are the highlights of India budget 2011-12:

India Budget 2011-12: Taxes
The normal rate for excise duty will be 10 percent and CENVAT rates will stay the same as the previous fiscal.
Export duty for iron ore has been raised to 20 percent.
The limit for exemption from personal taxes, to be paid by individuals, has been raised to INR 180,000 from INR 160,000.
130 new items will now be included in the purview of taxation and they will be subject to a nominal central excise duty of 1 percent.
Certain items such as basic food and fuel, silver and gold jewelry, and precious stones will be exempted.
In case of senior citizens the age of qualification has been brought down to 60 years.
The exemption limit for these taxpayers has gone up to INR 2.50 lakh.
Maximum customs duty will stay at 10 percent because of the economic condition around the world.
The tax exemption granted to citizen above the 80 years age group has been raised to INR 5 lakh.
Basic customs duty, applicable to agricultural machines to be brought down from 5% to 4.5%.
Surcharge levied on Indian companies has been brought down from 7.5% to 5%.
Service taxes will now cover hotel accommodation in excess of INR 1000 on a daily basis, and other areas like air conditioned restaurants serving wine, certain type of hospitals, and diagnostic tests.
Minimum alternate tax has been increased from 18% to 18.5%.
Service taxes on air fares will be increased by INR 250 for international travel and INR 50 for domestic flights in economy class. In case of the higher classes there will be a 10 percent increase.
Revenue loss from direct tax proposals to amount to INR 115 billion.
Simpler tax forms will be launched for smaller taxpayers.
Rate of service taxes will stay at 10 percent.
Art works will not be subject to customs duties when they are being imported to be exhibited in publicly held organizations.
This facility will now be provided to privately held entities as well.
Net revenue of INR 73 billion is expected from excise and custom proposals.
India Budget 2011-12: Subsidies
INR 1.44 trillion has been earmarked for the subsidy bill.
INR 236.4 billion will be allocated for the petroleum subsidy bill.
INR 605.7 billion has been set aside for the food subsidy bill.
Publicly held oil retailers will receive cash subsidies amounting to INR 200 billion.
INR 500 billion will be spent on the fertilizer subsidy bill.
India Budget 2011-12: Budget Deficit
For the 2011-12 fiscal, budget deficit has been set at 4.6 percent of the Gross Domestic Product.
For the 2013-14 fiscal, budget deficit is supposed to come down to 3.5 percent of the GDP.

India Budget 2011-12: Public Expenditure
The total government spending is decided at INR 12.58 trillion in 2011-12 and the planned expenditure will go up by 18.3 percent or INR 4.41 trillion.

India Budget 2011-12: Estimated Revenue Details
The government is expected to earn INR 9.32 trillion.
INR 1.64 trillion to come from factory gate duties.
Revenue apart from taxes is expected to be INR 1.25 trillion.
Service tax receipts to amount to INR 820 billion in 2011-12.
Earnings from corporate taxes to amount to INR 3.6 trillion.
Proposed indirect taxes to contribute INR 113 billion.
The tax-to-GDP ratio would be 10.4% in 2011-12 fiscal and go up to 10.8 percent in 2012-13.
Net revenue from proposed service taxes have been estimated at INR 40 billion.
INR 1.52 trillion to be generated from customs duties.

India Budget 2011-12: Disinvestment
The government is expected to honor its commitment of keeping 51 percent shares in public sector companies.
The aggregate disinvestment for the 2011-12 fiscal is expected to be INR 400 billion.

India Budget 2011-12: Debts
The gross market borrowing for the government is expected to be INR 4.17 trillion in 2011-12 fiscal.
The net market borrowing for the Indian government has been pegged at INR 3.43 trillion for the 2011-12 fiscal.

India Budget 2011-12: Sector-wise Expenditure
At least INR 1.64 trillion will be allocated for the defense sector in 2011-12 fiscal.
The Aligarh Muslim University centers at Mallapuram and Murshidabad will receive INR 54 crores each.
The amount allocated in the rural infrastructure development fund will be increased to INR 180 billion.
INR 58,000 crores has been set aside for Bharat Nirman project. This marks an addition of INR 10,000 crores.
State run banks will be provided INR 201.5 billion.
Wage rates for the Mahatma Gandhi National Rural Employment Guarantee Scheme will be connected to the consumer price index. Wages are expected to go up from INR 100 from a daily basis.
INR 520.5 billion would be allotted for the educational sector with INR 21,000 crore earmarked for Sarva Shiksha Abhiyan.
Budgetary allotment for the social sector has increased by 7 percent.
Allotment for health sector will be increased to INR 267.6 billion.
The allocation for important infrastructural development has been increased by 23 percent to INR 214,000 crores.
An additional amount of INR 500 crores will be allocated to the national skill development fund.

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