NDA’s first budget for the year 2014-15 has been presented by the Finance Minister Arun Jaitley in the Lok Sabha today. By and large, the budget has a bit of everything, but also more of none. The plan expenditure for 2014-15 has been put at 17 lakh 90 thousand crores, the non-plan expenditure is at 12 lakh 20 thousand crores. The fiscal deficit is targeted to be kept at 4.1%. Next year, FM hopes to bring it down to 3.6%, further down to 3% in 2016-17. The GDP growth rate is hoped to be pushed up to 7%, 8% in the next three, four years.
Of the major decisions announced by the FM, the chief focus goes to FDI in defence, insurance, indication of allowing FDI’s into e-commerce; proposal to implement GST by the year end; linking MNREGA to farming related activity; sops to power production – especially in solar, wind power production; reduction of taxes on resources that are needed in iron production – resulting in support to real estate sector; Digital India initiatives; renewed focus on cultural, religious revival of India; Urban facility production through smart cities, metro rail connectivity, better roads etc.
For the general public, there are no significant tax hikes, there are reduction of taxes on electronic goods like mobiles, TVs, footwear, soaps, branded garments etc. The salaried class had little to cheer, as the IT limit, savings limit under 80C, housing loan rebate have been raised by just Rs. 50,000 each only. PPF savings limit too has been raised by fifty thousand, bringing it to 1.5 lakhs. Cost of cigarettes and other tobacco products could rise from between 10% to over 70% due to new taxes proposed.
Things to cost less:
Domestically produced LCD, LED TVs of size 19 inches or less,
Computer monitors, mobiles, few other electronic goods,
Footwear priced below 1000, cotton garments,
Soaps, processed food, stainless steel,
Solar power units, broken diamonds, other jewelry,
Things to cost more:
Cigarettes, cigars other tobacco products; sugar based aerated drinks,
branded imported garments