Budget 2005: Income Tax
Finance minister P Chidambaram has unveiled a budget that encourages the middle class to save more, while providing them a much simplified income tax system.
Chidambaram has retained tax exemption on income upto Rs 1 lakh of income, while giving women and senior citizens further relief. Women with income upto Rs 1.25 lakh and senior citizens with income upto Rs 1.5 lakh have been brought out of income tax net.
On annual income between Rs 1 to Rs 1.5 plakh the income tax would be deducted at 10 per cent, while for income between Rs 1.5 lakh to Rs 2.5 lakh the tax would be at 20 per cent.
For income above Rs 2.5 lakh the income tax rate would be 30 per cent. Chidambaram also announced that the 10 per cent surcharge would now be applied to income over Rs 10 lakh, instead of the existing Rs 8.5 lakh.
Chidambaram said the government would be introducing a new bill on the new simplified income tax system in the coming days. The finance minister also removed the standard deduction from the income tax structure.
All tax payers would be allowed a consolidated exemption limit of Rs 1 lakh before tax calculation.
Chidambaram said the government was also removing all sectoral exemptions on savings, while retaining tax deductions on six sectors including the all important interest paid on housing loan. The other five expenses on which the tax exemption would remain are medical insurance premium, treatment of disabled dependent, treatment of self and family, loan on higher studies, expenses due to disability.
Chidambaram also announced the government's intention to be firm on taxing fringe benefits enjoyed by employees. Calling it the "Fringe Benefits Tax", Chidambaram said it would be levied at 30 per cent of income from such fringe benefits given by employers. All perks other than conveyance and canteen allowances would be covered by the fringe benefits tax, he said.
Picked up from TOI online
Budget 2005: Highlights
- Rs 5500cr outlay for 7 mega-cities Priority for roads, ports & airports
- SPl SPVs to fund infrastructure deficit Forex resources to be tapped
- Service tax on pipeline transmission at 10.2%
- Customs & excise on LPG & Kerosene 0% Cess on petrol and diesel at 50p/ litre
- Crude oil customs duty cut to 5% Peak duty reduction on petro products to 10%
- Savings till Rs 1 lakh to be deducted from taxable income
- No change in corporate tax for foreign companies
- Conveyance, canteen allowances outside tax net
- Standard deduction removed No tax for annual income of Rs 1 lakh
- Expert committee to be set up for EET system
- Exemption for women at Rs 1.25 lakh Exemption for senior citizens Rs 1.5 lakh
- Tax of 0.1% on cash withdrawal of Rs 10,000 per day
- Initial depreciation rate increased to 20% To levy fringe benefits tax of 30%
- Depreciation rate to be 15% for plant and machinery
- Corporate tax rate for domestic co's at 30% Corporate tax at 30% Surcharge of 10%
- STT to be increased to 0.02% from 0.015% for day traders
- Rs 1-1.5 lakh at 10% Rs 1.5-2.5 lakh at 20%
- More taxes on perks Deductions under medical insurance premiums to continue
- Fertiliser subsidy could be cut if natural gas is used
- To continue subsidies but in recast form
- Foodgrain procurement to be made more cost-effective
- Customs duty on industrial raw materials cut to 10%
- Customs duty on coking coal cut from 15% to 5%
- To allow banking companies to issue preference shares
- New Banking bill to be introduced in Budget session
- Credit linking target increased to 2.5 lakh SHGs
- 12th Finance commission to cost the centre Rs 26000 cr
- Revenue deficit 2.7%; Fiscal deficit 4.3%
- Plan expenditure of Rs 1,72,500 cr Non-plan expenditure Rs 3,70,847 cr
- Targets $15000 cr of exports by FY'09
- Will ensure devp schemes don't continue without checks
- Fertiliser subsidy could be cut if natural gas is used
- Defence allocation increased to Rs 83000 cr
- Rs 34375 cr on capital expenditure for defence
- Entire production, distribution chain to be covered soon
- VAT to be introduced from 1st April 2005
- To make Mumbai regional 'hub for finance'
- May allow trading of asset backed debt
- To clear legal validity of OTC derivative contracts
- Stamp duty exemption for corporatisation of stock exchanges
- FIIs to give collateral on derivatives trade
- To ammend Banking Regulation Act
- To remove cap/floor for SLR for banks
- Seeks overseas investment in mining, trade, pensions
- Trade policy to be further liberalised
- Forex to be used for infrastructure projects
- SMEs in Pharma, IT to get equity support
- Companies allowed to re-negotiate debt
- Financial package to to be worked out by NABARD
- Capital subsidy allocation for SSI's up to Rs 173 cr
- To extend insurance scheme for 2 mn handloom weavers
- Lower interest costs for Sugar industries
- To launch manufacturing competitiveness plan for SME's
- 10% capital subsidies scheme for textile sector
- To ask PSU banks to increase borrowers by 5 mn in FY'06
- New fund for strategic agriculture research Rs 50 cr allocated
- Rs 450 cr provided for Highway development in North East
- Micro-finance devpt fund increased to Rs 200 cr
- Services sector to get stable tax policy
- National Agriculture Insurance scheme to continue
- Rs 6,253 cr for devpt of SC/ST Special scheme for SC/ST students
- Loans for rural areas to increase by 30%
- Rs 1,08,500 cr to be disbursed as loans
- Comparative advantages in tea have eroded
- Price stabilisation fund for commodities not effective
- To provide telephone connections to 66,820 villages
- Rs 14,040 cr equity support & Rs 3,554 cr as loans for PSEs
- Rs 14,040 cr equity support & Rs 3,554 cr as loans for PSEs
- National Horticulture Mission to get Rs 630 cr
- 60 lakh additional houses for rural poor
- Telephone connectivity for 66,822 villages
- Electricity to 1.25 lakh villages
- Addl 1 cr hectare to be brought under irrigation
- Rs 4200 cr state plan for Jammu and Kashmir Rs 14379 cr allocation for J&K
- 2000 Rajiv Gandhi fellowships On pattern of UGC fellowships
- Double nutrition norms Centre to share half of state's burden
- Schemes for SC/STs Rs 6253 cr allocated
- Mid-day meal allocation up to Rs 3,010 cr vs Rs 1,675 cr
- Baramull-Udhampur railway project designated project of national importance
- Special grants for Bihar Over Rs 7900 cr granted to Bihar
- New backward regions grant fund to get Rs 5000cr
- Outlay on drinking water increased to Rs 4,750 cr
- 170 backward districts Backward regions fund Rs 5000 cr yearly
- Separate statement on 'gender' sensitivity Central assistance for teaching Urdu
- ICDS allocation up 47% to Rs 3142cr Pledges 'inclusive economic growth'
- New prarambikh shiksha fund To be allocated Rs 7156 cr
- Sectors getting jobs will get highest govt. priority
- Textile job potential seen 12 mn in 5 yrs Gross Budgetary Support up 16.9%
- National Rural Health mission to start in FY'06
- Allocation for mid-day meal goes up to Rs 3010 cr
- Education allocation at Rs 18,337 cr in in FY'06
- Food-for-work programme announced in 250 districts
- Allocation for health and family welfare at Rs 10,280cr
- 70 lakh extra jobs in IT by 2009 Fertilizer subsidy in FY'06 at Rs 16254cr
- Subsidy for Rural devt. at Rs 18,334 cr
- Allocation to increase to 10,280 crores
- Food-for-work programme successful Programme announced in 250 districts
- One crore to be employed in irrigation schemes
- Non-food credit up 21.5% To raise plan expenditure by 25.6%
- To raise plan expenditure by 25.6% in FY' 06
- FM: UPA committed to greatest good to greatest number
- Rs 10,216 cr for Tsunami relief and rehabilitation
- CMP mandated growth rate of 7-8% Growth rate to be 6.9% Ind growth up 8.9%
The World Is Divided
There are 10 types of people in this world
Those who understand binary and those who don't!
Telecom Italia "Gandhi" Ad
Gandhi Ad...check it out!The father of the nation has finally gone commercial and that too not in India! Check this ad by Telecom Italia on the Epica Awards Site. Very well made...
Corporate Buzzword Bullshit
This is something I picked up from one of the forwards I got.
Do you want to impress boss or confuse clients or Vice versa? Use Techno vocabulary. It can be called the "Buzzword" writing method.
It is simple. There are three columns of words involved, as follows:
| 0. Balanced | 0. Management | 0. contingency |
| 1. total | 1. Organization | 1. Hardware(or software) |
| 2. integrated | 2. reciprocal | 2. projection |
| 3. compatible | 3. monitored | 3. time-frame |
| 4. synchronized | 4. digital | 4. concept |
| 5. optimal | 5. modular | 5. programming |
| 6. responsive | 6. transitional | 6. mobility |
| 7. functional | 7. Incremental | 7. capability |
| 8. parallel | 8. third-generation | 8. flexibility |
| 9. systemized | 9. policy | 9. options |
Just select any three-digit number; then use the corresponding Buzzwords from the above grid, e.g., 257: "integrated modular capability". Don't worry if it doesn't make sense to you; it won't mean anything to anyone else either, but they'll think you're just smarter than they are so they won't say anything!!
You can propose "systemized reciprocal options" (929) to achieve "optimal transitional flexibility" (568), so that we can think of an "integrated monitored projection" (232) and your boss will probably promote you or your customer will be blown away with your technological superiority.
Or if you want to get eCommerce specific, check out the Web Economy Bullshit Generator!
So go now and spread forth the buzzword bullshit!
Carly Fiorina's Reign Ends
Carly Fiorina Quits HPIt finally happened. The rumor mill was working overtime about her alleged differences with the HP board, so her sudden departure should not come as a total surprise to industry watchers, though they might consider it a trifle abrupt.
Always a controversial figure, she was never the darling of the investors. Her decision to acquire Compaq was faced with much resistance both inside and outside the company. The fatalists had billed it as the death blow to the company. It did not prove to be so bad although the then biggest merger in the IT industry was not exactly HP's greatest success story. Her decision to diversify into the consulting & services arena was another unpopular move not to mention the corporate jet she went shopping for during the dark era of
en-mass layoffs.
But like the HP management said, she had the right vision for the company, it was the execution they did not agree with it. Which makes sense to me, after all Carly was one of the very few women at the very top. You got to have some substance to lead a Fortune 20 giant.
Injury Season
Bhasker is sitting at home these days playing WOW. He is injured. How? He tore his ankle ligament while playing TT in the office. The doc has told him to stay put for 3-weeks, only essential walking...read only to the loo..miss that too if you can help it!
It seems to be the season for injuries. GNM just pinged, he has torn his knee ligament. He was late from the office and his landlord had locked the gate. Not wanting to wake anyone up, the well-meaning lad decided to climb over the gate. These days he is wobbling around on his heavy bandaged knee.
The good part is that the humor is still there. These guys found something to laugh at their predicament. While GNM was trying not to wake anybody up and almost woke up the entire street, Bhasker says he has a sports injury while coding. This reminds me of an embarrassing situation I was in a few weeks ago. I had sprained my jaw. How? I was yawning in the office and the bloody thing just jammed on me!!!
Cinni's Birthday Gift
We finally have an ELECTRIC GUITAR of our own!!! Its an Ibanez G10!!! Came in as Cinni's birthday gift.
Its a beginner-level from the Ibanez stable but its the best I could get for my budget. Its got a bolt-on maple neck, 22 fret rosewood fretboard with dot inlays, HSS pickup configuration, 5-way blade switch, 1 volume and 1 tone control, traditional tremolo, white pickguard and backplate, black finish, offset double cutaway agathis body,
Got a small Stranger Cube20 with the guitar though I was looking for a Marshal M15 as it has has built in overdrive and reverb. The tone of the guitar is pretty clean like the way good strats should be, the humbee adds a nice chunky sound to it. Haven't got any effects yet so its pretty much the guitar through the amp but its sounding pretty neat.
Cinni might join the Ashley's music school in Koramangala. She has got a knack for picking things up fast...so if you drop by our pad in a couple of months' time...you might get to hear some cool renditions of your fave songs :)
There and Back Again...
Thats been my story over the last 6 months or so...was getting jacked in a support project as the lead...so when I moved into the new job thought life's gonna be a little cooler. Well in a way it it...as in the office is just about 15 minutes away(45 sometimes in the Blr traffic) so it doesn't feel like I'm making a major journey to work. Things have been a little hectic lately making me work through the weekends and through the Republic Day but hopefully it'll ease of a bit the next week...maybe only for a week. The good part though is that I am liking it...and thats whats imp i guess...coz I dont mind spending my saturday evenings in office....though Cinni might have other thoughts :)
