Union Budget 2012-13

Union Finance Minister, Pranab Mukherjee, presented his seventh Union Budget for the year 2012-13. He termed the 2011-12 fiscal as "Year of Recovery Interrupted". To overcome the fiscal deficit taxes were raised and subsidies were cut. Here are the major highlights of Union Budget 2012-13.

• Headline inflation to moderate further in next few months and remain stable thereafter.

• GDP to grow by 6.9 per cent in 2011-12; had to battle double digit inflation for two years.

• GDP to grow by 7.6 per cent in 2012-13; plus, minus 0.25 per cent; expect inflation to be lower.

• Current account deficit 3.6 per cent in 2011-12; this put pressure on exchange rate.

• Full exemption from basic customs duty for road and highway construction.

• Completion of highway projects 44 per cent higher than in previous fiscal.

• Gold jewellery not bearing brand name to be included in the one per cent levy on precious metal jewellery.

• Customs duty on import of parts of aircraft, tyres and testing equipment fully exempted.

• Customs duty on warning systems/track upgrade equipment for railways reduced from 10 per cent to 7.5 per cent.

• Full exemption from basic customs duty on natural gas, LNG, uranium for generation of electricity for two years.

• Oil cess on domestic crude raised to Rs 4,500 per ton from Rs 2,500 per ton.

• Excise duty on all processed food brought down to merit rate of 6 per cent.

• Customs and central excise proposals to net a revenue of Rs 27,280 crore.

• Baggage allowance for people of Indian origin increased from Rs 25,000 to Rs 35,000 and for children from Rs 12,000 to Rs 15,000.

• Customs duty on standard gold bar and coins exceeding 99.5 per cent purity, platinum and non-standard gold raised.

• Branded silver jewellery fully exempted from excise duty.

• Installation of solar plants exempted from CVD. 

• Customs duty on bicycles and parts increased.

• Import duty on large cars, MUVs, SUVs enhanced.

• Introduction of compulsory reporting of assets held abroad.

• Standard excise duty rate raised from 10 per cent to 12 per cent.

• Interest income of up to 10 per cent to be exempted from tax.

• Copyright relating to cinematography in film industry exempted from service tax.

• Service tax raised from 10% to 20% to yield additional revenue of Rs 18,650 crore.

• Securities Transaction Tax (STT) reduced from 0.125 per cent to 0.1 per cent.

• Cars to attract ad valorem rate of 27 per cent. 

• Tax exemption of up to Rs 5,000 for health insurance for annual preventive health checkup. 

• Capital gains tax on residential property exempted if sale proceeds used for SMEs.

• No change in the peak rate customs duty.

• No Income Tax for income up to Rs 2 lakh; 10% on income between Rs 2-5 lakh; 20% on income between Rs 5-10 lakh and 30% on income above Rs 10 lakh.

• Deduction of up to Rs.10,000 from interest from savings bank accounts.

• New equity savings scheme to provide for income tax deduction of 50 per cent for those who invest Rs.50,000 in equity and whose annual income is less than Rs.10 lakh.

• Defence to get Rs.1.93 lakh crore during 2012-13.

• Four thousand residential quarters to be constructed for paramilitary forces with an allocation of Rs.1,185 crore.

• National Skill Development Fund allocated Rs.1,000 crore.

• National Population Register to be completed in two years.

• Allocation of Rs.200 crore for research on climate change.

• Integrated Child Development Scheme to be strengthened and restructured with allocation of Rs.15,850 crore.

• Allocation of Rs.14,000 crore for rural water supply and sanitation.

• Infusion of Rs.15,888 crore in public sector banks, regional rural banks and NABARD in 2012-13.

• Infrastructure will require Rs.50 lakh crore in 12th Plan, half of this from the private sector.

• Number of proactive steps taken on black money (stashed away abroad); information has started flowing in, prosecution to be initiated; White Paper in current session.

• Addressing malnutrition, black money and corruption in public life among five priorities in year ahead.

• No change in corporate taxes but measures to enable them better access funds.

• Corporate market reforms to be initiated.

• Irrigation and water resource company to be operationalised.

• National mission on food processing to be started in cooperation with state governments.

• Bills on micro-finance institutions, national land bank and public debt management among those to be introduced in 2012-13.

• India's inflation structural, driven largely by agricultural constraints.

• Agriculture and services continued to perform well; economy is now turning around; recovery in core sectors.

• Withholding tax on external commercial borrowings reduced from 20% to 5% for power, airlines, roads, bridges, affordable houses and fertiliser sectors.  

• Import of equipment for fertilizer plants fully exempt from customs duty for three years.

• Import duty on equipment for iron ore mining reduced from 7.5 to 2.5 per cent.

• External commercial borrowing of up to $1 billion permitted for airline sector.

• External commercial borrowings permitted to low-cost housing sector.

• Direct taxes proposals to result in net revenue loss of Rs 4,500 crore.

• Fiscal deficit at 5.9 per cent of GDP in revised estimates for 2011-12. 

• Direct tax collection fell short by Rs 32,000 crore in current fiscal. 

• Hope to raise Rs.30,000 crore from disinvestments.

• Determined to bring down fiscal deficit to 5.1 per cent of GDP next fiscal. 

• Better monitoring of expenditure on government schemes.

• Non-plan expenditure Rs 9,69,900 crore in 2012-13; 8.7 per cent higher than current year. 

• Total debt of the Centre will be 45 per cent of GDP.

• 40 crore Aadhar enrollment in year beginning April 2012.