BUDGET ESTIMATES 2011-12

BUDGET ESTIMATES 2011-12
„ Gross Tax receipts are estimated at  Rs. 9,32,440 crore.
„ Non-tax revenue receipts estimated at 1,25,435 crore.
„ Total expenditure proposed at  12,57,729 crore.
„ Increase of 18.3 per cent in total Plan allocation.
„ Increase of 10.9 per cent in the Non-plan expenditure.
„ XI Plan expenditure more than 100 per cent in nominal terms than envisaged for the Plan period.
„ Increase of 23 per cent in Plan and Non-plan transfer to States and UTs.
„ Fiscal Deficit brought down from 5.5 per cent in BE 2010-11 to 5.1 per cent of GDP in RE 2010-11.
„ Fiscal Deficit kept at 4.6 per cent of GDP for 2011-12.
„ Fiscal Deficit to be progressively reduced to 3.5 per cent by 2013-14.
„ “Effective Revenue Deficit” estimated at 2.3 per cent of GDP in the Revised
Estimates for 2010-11 and 1.8 per cent for 2011-12.
„ All subsidy related liabilities brought into fiscal accounting.
„ Net market borrowing of the Government through dated securities in 2011-12 would be  3.43 lakh crores

Central Government debt estimated at 44.2 per cent of GDP for 2011-12 as against 52.5 per cent recommened by the 13th  Finance Commission.




TAX PROPOSALS:
Direct Taxes
„ Exemption limit for the general category of individual taxpayers enhanced from  Rs. 1,60,000 to  1,80,000 giving uniform tax relief of  2,000.
„ Exemption limit enhanced and qualifying age reduced for senior citizens.
„ Higher exemption limit for Very Senior Citizens, who are 80 years or above.
„ Current surcharge of 7.5 per cent on domestic companies proposed to be reduced to 5 per cent.
„ Rate of Minimum Alternative Tax proposed to be increased from 18 per cent to 18.5 per cent of book profits.
„ Tax incentives extended to attract foreign funds for financing of infrastructure.
„ Additional deduction of ` 20,000 for investment in long-term infrastructure bonds proposed to be extended for one more year.
„ Lower rate of 15 per cent tax on dividends received by an Indian company from its foreign subsidiary.
„ Benefit of investment linked deduction extended to businesses engaged in the production of fertilisers.
„ Investment linked deduction to businesses developing affordable housing.
„ Weighted deduction on payments made to National Laboratories, Universities and Institutes of Technology to be enhanced to 200 per cent.
„ System of collection of information from foreign tax jurisdictions to be strengthened.
„ A net revenue loss of ` 11,500 crore estimated as a result of proposals.


Indirect Taxes
„ To stay on course for transition to GST.
„ Central Excise Duty to be maintained at standard rate of 10 per cent.
„ Reduction in number of exemptions in Central Excise rate structure.
„ Nominal Central Excise Duty of 1 per cent imposed on 130 items entering in the tax net.
„ Lower rate of Central Excise Duty enhanced from 4 per cent to 5 per cent.
„ Optional levy on branded garments or made up proposed to be converted into a mandatory levy at unified rate of 10 per cent.
„ Peak rate of Custom Duty held at its current level.


Service Tax
„ Standard rate of Service Tax retained at 10 per cent, while seeking a closer fit between present regime and its GST successor.
„ Hotel accommodation in excess of ` 1,000 per day and service provided by air conditioned restaurants that have license to serve liquor added as new services for levying Service Tax.
„ Tax on all services provided by hospitals with 25 or more beds with facility of central air conditioning.
„ Service Tax on air travel both domestic and international raised.
„ Services provided by life insurance companies in the area of investment and some more legal services proposed to be brought into tax net.
„ All individual and sole proprietor tax payers with a turn over upto Rs 60 lakh freed from the formalities of audit.
„ To encourage voluntary compliance the penal provision for Service Tax are being rationalised.  Similar changes being carried out in Central Excise and Custom laws.
„ Proposals relating to Service Tax estimated to result in net revenue gain of 4,000 crore.
„ Proposals relating to Direct Taxes estimated to result in a revenue loss of 11,500 crore and those related to Indirect Taxes estimated to result in net revenue gain of  11,300 crore.