Highlights: Union Budget 2012-13 ::Tata Mutual Fund

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Mr Pranab Mukherjee has presented the budget keeping in mind the five focus area:
•	Revival of domestic consumption
•	Achieve an enabling environment for revival of high growth
•	Remove supply bottlenecks
•	Intervene decisively to address malnutrition
•	Expedite improvement in delivery systems and address black money
As per the Union Budget 2012-13, the growth in FY 2011-12 has slowed due to the global crisis with the Indian economy expected to grow at 6.9% with agricultural sector growing at 5.4% and services sector growing at 9.6% in financial year 2011-12 and the GDP growth expected during FY 2012-13 at 7.85%. The fiscal deficit is 5.1% of the GDP for the fiscal year 2013.
We have summarized below the key highlights of the Union Budget 2012-13 as tabled in the Lok Sabha earlier today:
1.	Number of measures proposed to deter generation and use of unaccounted money
2.	Dedicated information cells to track black money with an introduction of white paper on black money
3.	National population registry project to be completed in the next two years
4.	Additional interest subvention 3% on loans upto Rs. 3 lakhs to women self help groups
5.	National Rural Livelihood Mission to provide self employment
6.	External Commercial Borrowings (ECB) allowed to part finance rupee debt of power projects
7.	ECB for working capital requirement of aviation industry for a period of 1 year with an upper cap of USD 1 billion
8.	FDI in aviation sector is under consideration
9.	India opportunity venture fund to be launched
10.	Tax free infra bonds to be raised to Rs. 60,000 crore
11.	Telecom towers eligible for viability gap funding
12.	QFIs would be allowed to access corporate bonds
13.	Plan to incorporate financial holding company for bank capitalization
14.	Plan to bring subsidy to 1.7% in 3 years
15.	Goods and Service Tax Bill (GST Bill) proposed to be operational by August 2012
16.	Service tax rates proposed to be hiked from 10 percent to 12 percent
17.	Excise duty proposed to be hiked to 12 percent
18.	Negative list introduced for Service tax exempting 17 specified services which includes school education
19.	Efforts on for consensus with states on FDI in multi-brand retail
20.	Infrastructure investment in 12th Plan to go up to Rs. 50 lakh crore; half of it to come from private sector
21.	Corporate market reforms to be initiated
22.	Bills on micro-finance institutions, national land bank and public debt management among those to be introduced in 2012-13
23.	New equity savings scheme to provide for income tax deduction of 50% for those who invest Rs.50,000 in equity and whose annual income is less than Rs. 10 lakhs
The FM in his efforts to align the Income-tax Act, 1961 to the Direct Taxes Code has proposed the following amendments in the Budget:
1.	Basic exemption limit for general tax payers has been raised from Rs. 180,000 to Rs. 200,000.
2.	Individual will have to pay 10 per cent tax on income between Rs. 2 lakh and Rs. 5 lakh; 20 per cent between Rs. 5 lakh and Rs. 10 lakh; and 30 per cent for above Rs. 10 lakh.
3.	Interest on savings account exempt upto Rs. 10,000
4.	Reduction in STT rate by 20% from 0.125% to 0.1%
5.	Turnover limit for compulsory tax audit for SMEs raised from Rs. 60 lakh to Rs. 1 crore
6.	Withholding tax of 5% would apply for interest on overseas borrowings
7.	To encourage forex inflow, the rate of taxation for foreign dividend has been maintained at 15% for Indian companies
8.	General Anti Avoidance Rule being introduced to counter aggressive tax avoidance
9.	New revised income tax return form ‘Sugam’ to be introduced for small tax payers
10.	Minimum alternate tax raised from 18% to 18.5% of book profits
11.	Introduction of Advance pricing arrangement
12.	Removal of specified sectors for investment by domestic venture capital fund
13	Time limit for reopening of assessment raised to 16 years