Union Budget 2006-07
Growth is best antidote to poverty. The assault on poverty continues, says the finance minister
Non-food credit growing at 25%, says the finance minister
Higher FII investment ceiling & segregation from FDI likely
GDP growth likely to be 8.1%, says FM. Agricultre growth too up. ALl sectors performing well. Inflation was 4.02%.
FM says: Prospect for 2006 are just as good says the FM. 2005 has seen many natural diasters and the goverment has come good with
rehabiliation.
Higher FII investment ceiling & segregation from FDI likely
FM describes this year as: The best of times and worst of times..
Higher FII investment ceiling & segregation from FDI likely
The FM Mr Chidambaram has begun his Budget 2006 speech
FM begins his speech in Parliament
AED paid to state may be scrapped for sugar cos
Minimum alternative tax on corporates increased from 7.5 per cent to 10 per cent.
Donations to only religious institutions will be exempted from tax.
The Rs 10,000 exemption limit for investment in pension funds under Section 80CCC has been removed but these investments would be brought under Sec.80C subject to a ceiling of Rs 1
lakh.
Fixed deposits in scheduled commercial banks with at least five year maturity will get tax exemption for savings under section 80C of Income Tax Act.
Cooperative lending banks and rural development banks to be exempted from taxes under Section 80(B).
Cooperative lending banks and rural development banks to
25 per cent across the board increase in securities transaction tax.
Services tax net to be increased which include ATM operations, maintenance and management, share transfers, registration, international air travel excluding economy class, sponsorship other sports events, auctioneers, ship management and travel on cruise.
LPG : It will go under declared good under STT act that will help in moderating the price.
VAT has been a resounding success and non VAT states will also go in for VAT.
Donations to only religious institutions will be exempted from tax.
Minimum alternative tax on corporates increased from 7.5 per cent to ten per cent.
Pension plan brought under section 88G
Fixed deposits in scheduled commercial banks with at least five year maturity will get tax exemption for savings under section 80C of Income Tax Act.
Banking cash transaction which was levied last year helped in tracking blac money.
Services tax net to be increased which include ATM operations, maintenance and management, share transfers, registration, international air travel excluding economy class, sponsorship other sports events,
autioneers, ship management and travel on cruise.
1/6 rule for tax return filing abolished.
One by six scheme for filing of income tax returns has been abolished.
Fixed deposits in scheduled banks for 5 years under section 80C to be exempt from income tax
Security transaction tax: 25% increase in STT
No change in personal income tax of corporates. NO new taxes are being imposed.
Service tax to be hiked from 10% to 12%
Servive Tax to be levied on: ATM operations, share transfter agents, sponsership of events other than sports events, container services on rail,
auctionering, ship mgt services.
service Tax: 54% of GDP in 2005-6
excise duty: cigrattes: increased by 5%
Cigarettes to cost more
Excise Duty: SET top box: 16% and customs duty reduced from 15% to
nill.
To double world export share to 1.5% by FY09
Revenue Deficit estimated for FY07 to be Rs 84,727cr - 2.1% of GDP.
Import duty on paraxylene cut to 2%
Import duty on paraxylene cut to 2%
Import duty on man-made fibre and yarn from 10% to 8%
Packaging machines duty down from 15% to 5%
excise duty: Paper: reduced 16 to 12%
To protect vanaspati industry, customs duty to be increased to 80 per cent on its imports.
Duty on leather footware cut
exemption from excise : DVD, Flash and combo drives, Pasta, yeast, dairy products.
Four per cent contervaling duty on all imports to be levied with few exceptions.
Customs duty on bulk plastics reduced from 10 per cent to five per cent.
excise duties for cars: reduce 16% on small car.
Excise duty cut to 16% for only small cars
Import duty on all man-made fibres and yarn cut from 15% to 10%
Cotton Textile industry: excise duty: reduced from 16 to 8% on all man made yarn.
Customs duty peak rate cut from 15% to 10%
Customs duty peak rete cut from 15% to 10%
Customs duty on ferrous alloys reduced from 10% to 7.5%
CVD on all imports.
Customs duty: Vital drugs: 10 anti aids and anti cancer drugs 5% duty.
Drugs: Cutsoms duty on 10 anti-AIDS and 14 anti-Cancer drugs cut
Duty on bulk plastics cut from 10 to 5%
Duty cut from 15 to 10% on inorganic chemicals
Customs duty: refractries: reduce to 7.5%
Custom duty on refractories to be cut from 10 to 7.5%
Customs duty: non agricultural products peak rate to come down from 15 to 12%
Customs duties: Peak rate for non-agri products from 15% to 12.5%
Tax Proposals: Tax rates will be moderate and stable
Rev Deficit: 2.6% and Fiscal def 4.1%.
Path Breaking events on fiscal deficit: Gross Tax GDP ration: 9.8% in 04 to 10.5% 05 to 11.2% in 07
NHAI to be reconstituted to make it more effective.
Univ of Calcutta Univ of Mumbai , Univ of Madras gets a grant Rs 50,000cr to each
univ. Rs100 crore, Punjab Agriculture University.
Rs 50 crore to be given to Mumbai, Kolkata and Chennai universities
India's foreign tourist arrivals increased to 3.92 million last year. Fifteen tourist development circuits identified for development.
40,000 more villages to be electrified under Rajiv Gandhi Gramin Vidhyutikaran
Yojana.
A bill on cellular telephony in rural areas to be brought in Parliament by the Communications Ministry.
Rs 1,500 crore to be allocated for Universal Services obligations Fund under the telecom sector.
Limit of FII invenstment in govt securites hiked.
India infrastructure investment company to be set up
Banking Sector Reforms: K P Narsimhan committe for Insurance sector has suggested news bills which govt will introduce in the parliament.
A National Jute Board to be set up.
An allocation of Rs 189 crore provided for this.
Government also announced setting up of 12 textile industry parks of which 7 have been approved and ten more in the pipeline.
Textile upgradation fund allocation to be raised to Rs 55 crore in 2006-07 from Rs 455 crore following good response in the last two years.
Services sector put on par with manufacturing sector.
SMEs in service sector to get the status of SSI in manufacturing sector. To fund them a corpus will be raised by SIDBI for Rs 2500 crore from the present Rs 1122 crore in the next five years.
Thrust industries: textile, food processing, etc. Creation of textile parks on the anvil Farm credit to increase to 1,75,000 cr.
Focus on tourism to help hospitality sector
A bill on cellular telephony in rural areas to be brought in Parliament by the Communications Ministry.
Deep Draft Port: A committe has identified a Deep Draft Port in West Bengal.
11:40 Education focussed co gain: Educomp Solutions, NIIT & NIIT Technologies up 11:34 Cement stocks flare up: Mangalam Cement, Mysore Cements & Grasim up 11:30 Sensex losers: Ranbaxy Labs, Hindalco & ITC
Road development programme for North East Rs 550cr.
Refinary: Investment of Rs 2200cr is expected in this sector.
Coal: deblog coal reserves for power.
SMEs in service sector to get the status of SSI in manufacturing sector. To fund them a corpus will be raised by SIDBI for Rs 2500 crore from the present Rs 1122 crore in the next five years.
Rs 597 cr for non conventional engery resouces.
New projects in Chattisgarh, Maharashtra for Power.
Services sector put on par with manufacturing sector.
Telecom Sector: 250 million connection by 2007. Rs. 1500 cr allocated in 2006-07.
Services sector put on par with manufacturing sector.
4 new hotel institues in Chattishgarh to enhance the tourism industry.
FM Says: Cluster development model of increasing manufacturing.
Petro Chemicals: govt has created a task force to increase investment in this industry.
Rajiv Gandhi drinking water plan gets a hike.
Refinery sector to get boost, will promote FDI
Creation of textile parks on the anvil
Thrust industries: textile, food processing, etc.
Focus on tourism to help hospitality sector
Policy Rationalisation to benefit Telecom Players
Rs 3000 cr towards VAT losses in year 2005.
An investment protection fund under the aegis of SEBI would be set up.
FII investment limit in stock markets will be raised from $1.75 billion to $2 billion to deepen, strengthen and broaden the market.
An Investors Protection Fund will be set up and funded by fines and penalties to safeguard the interests of retail investors.
150th anniversary of the first war of Indian Independence. Budget allocated for
preperations.
Rs 1156 cr in the current year was given to backward districts, Rs 5000 cr has been allocated for the same in 2007.
J & K gets Rs2300 cr budget plan in addtional Rs 844 cr for J& K resconstruction plan. Rs 1300 cr for power sector reforms.
Expected 10% GDP growth to benefit cement and construction companies
FM Says: Food processing will be a priority sector for bank loans.
Focus on Irrigation will benefit fertiliser sector
Addition of 5000MW to benefit power sector
Gems and jewellery sector to get incentives
FM Says: Textile industry: encouraging reponse to technology upgration in this industry. Govt increases from Rs435cr to 535 cr for tech upgradation and setting up parks for this industry.
11:34 Cement stocks flare up: Mangalam Cement, Mysore Cements & Grasim up 11:30 Sensex losers: Ranbaxy Labs, Hindalco & ITC 11:26 Market slips from higher levels: Sensex up 16 points, Nifty down 4 points
Maulana Azad Educational Foundation corpus doubled to Rs 200 crore
(Rs 2 billion) for greater financial support to organizations involved in minority welfare.
FM says: NSS 59th round reveal, only 27% rec credit. Committe for suggesting for desiging a plan to rec credit to every farmer family.
Allocation for national Urdu education programme increased to Rs 13 crore from Rs 10 crore this year.
One thousand schools for girls of SCs, STs, OBCs and minorities to be set up.
A girl child will get Rs 3,000 deposited in a bank account after she enrolls for eighth class examination and the amount would be given when she becomes a major.
Rs 16,000 crore allocated for PSUs
Separate window for tenant farmers to ensure loan share. Agri credit proposed to be increased to Rs 175,000 crore next year as against Rs 1,41,500
crore, covering additional 50 lakh farmers.
A girl child will get Rs 3,000 deposited in a bank account after she enrols for eighth class examination and the amount would be given when she becomes a major.
One thousand schools for girls of SCs, STs, OBCs and minorities to be set up.
FM Says: National Agricultura Insurance Scheme continues.
Agri credit proposed to be increased to RS 175,000 crore next year as against Rs 1,41,500
crore, covering additional 50 lakh farmers.
Separate window for tenant farmers to ensure loan share.
Economy's main focus to be on agriculture, as earlier. Farm credit increased to Rs 1,75,000
crore. Fifty lakh farmers to get credit facility from banks.
The upward limit of Rs 3 lakhs on the principal amount
FM Says:For Farmers: NABARD continues to help the farmers. Farmers receive Short term credit at 7%.
Short term loans to farmers at 7%
Allocation for national Urdu education programme increased to Rs 13 crore from Rs 10 crore this year.
Planning Commission to draw up a programme to reconstruct the damaged infrastructure in calamity-hit areas.
FM says: Public Sector: equity support from Rs16900 crores to public sector including Railways.
Eight flagship programmes of the UPA including Sarva Shiksha Abhiyan and Mid-Day Meal Scheme will get a total allocation of Rs 60,015 crore in 2006/07 as against Rs 34,927 crore in the current year.
The central plan increased to Rs 1,31,285 crore next fiscal as against Rs 1.10,385 crore in the current year.
India catching up with high investment rates of South Asia and China
Gross budgetary support for annual plan expenditure has been raised to Rs 1,74,725 crore for 2006/07 as against Rs 1,43,497
crore, an increase of 20.4 per cent.
FM Says: Girl Child: One who passes 8 standard and goes to higher secondary level will have Rs 3000 deposited in her name by government and can withdraw it when she turns 18.
Allocation for it put at Rs 1430 crore from the Centre and the state government to provide matching contribution.
Allocation for mid-day meal scheme to be enhanced to Rs 4813 crore next fiscal as against Rs 3014 crore this year.
Old age pension to be increased to Rs 200 per month for above 75 years of age.
Metro in Hyderabad to be considered
FM Says: 20,000 schemes for minority students for scholarships based on merit.
FM Says: Sarva Sikhsa Abhiyan Rs 10,041 crore allocation.
10366 villages eletrified this year at a cost of Rs 1100
crore.
FM says: destitue pension increased rs. 200 per month.
A massive immunisation programme will be launched to eradicate polio completely by 2007.
Total budget for north-eastern region will be Rs 12,041 crore including Rs 1,350 crore for the ministry of north-east development.
The assault on poverty continues, says the finance minister. Growth is best antidote to poverty, he says.
Larger budgetary support to Bharat Nirmal Programme. Rs 18696 crore to be given which represents a hike of 54 per cent.
FM Says: Govt will support develpoing new town based on one type of industry.
Growth prospects in 2005-06 as bright as in 2004-05, says FM.
Economy to aim for 10% growth in FY 06.
FM describes this year as: The best of times and worst of times..
Golden Quadrilateral: 96% of work to be completed by June 06. Corridors to be completed by 08.
Rs 1,100 crore for rural electrification.
Gross Domestic Support for 2006-07 has been fixed at Rs 172,728
crore.
Gross Domestic Support for 2006-07 has been fixed at Rs 172,728
crore.
Fund allocation of Rs 12,041 crore for development of northeast.
FM Says: Mumbai Metro Rail and Bangalore Mumbai Metro Rail are under consideration.
Rs 944 crore grant for irrigation in Bharat Nirman.
Fund allocation of Rs 12,041 crore for development of northeast.
Rs 944 crore grant for irrigation in Bharat Nirman. Fund allocation of Rs 12,041 crore for development of northeast. Gross Domestic Support for 2006-07 has been fixed at Rs 172,728
crore. Manufacturing sector expected to grow at 9.4% during 2006-07. Rs 1,100 crore for rural electrification. Golden Quadrilateral: 96% of work to be completed by June 06. Corridors to be completed by 08. FM describes this year as: The best of times and worst of times.. Economy to aim for 10% growth in FY 06. Growth prospects in 2005-06 as bright as in 2004-05. Gross capital formation up 30% in FY 05. Savings up 21.9% of GDP in 2004-05. The GDP is likely to be 8.1% in 2005-06. 7.5% growth in 2004-05. Growth is best antidote to poverty. The assault on poverty continues, says the finance minister
FM Says: The world is his who does his job with compassion. The FM quoting famous Tamil by Tirukkural by Tiruvalluvar
Rs 28,737 crore has been allocated for gender budgeting under various heads.
New towns to be established on specific themes
Rs 14,300 crore for rural employment programme during 2006/07, out of which Rs 11,300 crore for NREG programme and Rs 3,000 crore for
SGRY.
FM says: The govt will create a market for agro products.
Government plans to eradicate polio by December 2007, Chidambaram said.
National Health Mission allocation increased to Rs 8207 crore in next fiscal from Rs 6,553 crore this year.
Rajiv Gandhi drinking water programme to get Rs 4680 crore next year as against Rs 3645 crore this year
Old age pension to be increased to Rs 200 per month for above 75 years of age.
India can be the textile manufacturing hub.
FM Says: Goal of eliminating liperacy by Dec 2005 was accomplished by the government.
500,000 additional class rooms to be constructed and 1.5 lakh additional teachers to be appointed.
Entire Rs 1,100 crore for rural electrification released this year and 10,366 villages to be electrified.
Rs 944 crore grant for irrigation in Bharat Nirman.
FM says: 562700 houses will be covered under irrigation schemes. Rs 720 cr allocatated for rural irrigation scheme
Allocation on education increased by 31.5 per cent to over Rs 24,150 crore and that for healthcare raised by 22 per cent to Rs 12, 546
crore.
Foodgrain output seen at 209.5 mt this year, says FM.
600,000 hectares of irrigation potential expected to be created this year. Rs 944 crore released this year under the Accelerated Irrigated Benefit
Programme.
FM says: Sarvshiksha Abhiyan under the 8 flagship schemes will increased allocation.
96% of the golden quadrilateral would be completed by June 2006 and the corridor would be completed by the end of 2008.
FM Says: On 8 flagship prog: Rs.5015cr has been allocated. Flagship
prog: eg. Midday meal, irrigation scheme for rural areas etc
Highway construction speeded up, progressing at 4.48 kms per day as against 1.86 kms in 2004.
Several indicators point to buoyancy in capital formation in the current year
FM Says: Overview of Budget: Bulk resources will go to 8 schemes of the UPA
11:07 Foods and Inns Foods and Inns trading up 9% 11:05 Foods and Inns PBA Infra flares up nearly 4% 11:01 Ansal Prop Ansal Properties goes up nearly 6% 11:00 Hindalco Hindalco trading with volumes of 1,41,551 shares
11:07 PSU banks up: PNB, Andhra Bank, Bank of Baroda & Canara Bank trading higher 11:06 Fertiliser stocks gain:
RCF, GSFC & Deepak Fertiliser up 11:04 Market firm: FM begins Budget speech: Sensex up 66 points, Nifty up 11 points 11:00 Auto stocks up: Tata Motors, Maruti & M&M move higher
Investment rate raised to 30% of GDP Rs. 11,700 to be spent on rural employment Tax revenue to GDP up to 10.5 from 9.8 GDP growth likely to be 9% National Saving Rate increased to 29%
Rs 11,700 crore to be spent on rural employment in the current year
FM proposes larger budgetary provision for Bharat Nirman
overnment's aim is to ensure montetary stability and managing external debt.
FM says: Rs 1100cr has been released for rural electrification.
Manufacturing secotr growth seen up at 9.4% in 2007
By 2008, the North South road corridor will be completed.
FM Says: 96% of goldern quadrangle will be complete by this year.
Work on in right earnest on the Golden Quadrilateral and the North South roads corridor
Prospects for 2005-06 very bright: FM
FM says: Natioanl Rural Employment scheme was launched last year which was big step for the government.
FM says: Salutes the farmers. The GDP overall growth is 7% and govt aims it to be 10%
Customs duty on naphtha may come down from 10% to 5%
Peak customs duty may be cut from 15% to 10%
Import duty on raw materials may be reduced to 5% from 10%
10:41 Tea & coffee stocks up: McLeod Russel & Tata Coffee gain 10:40 Losers on
NSE: Bharti Tele, ITC, Ranbaxy Labs & Hindalco 10:36 Market firm: Sensex up 60 pts, Nifty up 10 pts & CNX Midcap up 21 pts: 10:32 Sensex gainers: Tata Power, L&T, Infosys & ICICI Bank:
That's just a minute or two from now.... hold you breath
FM gets set to present Budget The finance minister arrives in Parliament with the trademark black briefcase to present the most-awaited event of the year- The Union Budget 2006-07. The finance minister will begin his budget speech at 11 am.
Higher FII investment ceiling & segregation from FDI likely
10:34 Binani Ind Binani Ind locked at 5% upper circuit 10:33 Agro Dutch Ind Agro Dutch Ind scales up 8% 10:32 IFCI IFCI is trading with volumes of 17,38,328 shares 10:28 Larsen L&T Top gainer on the Sensex
Higher FII investment ceiling & segregation from FDI likely
10:34 Binani Ind Binani Ind locked at 5% upper circuit 10:33 Agro Dutch Ind Agro Dutch Ind scales up 8% 10:32 IFCI IFCI is trading with volumes of 17,38,328 shares 10:28 Larsen L&T Top gainer on the Sensex
10:36 Market firm: Sensex up 60 pts, Nifty up 10 pts & CNX Midcap up 21 pts:
Higher FII investment ceiling & segregation from FDI likely
Higher FII investment ceiling & segregation from FDI likely
No change in Securities Transaction Tax, but extended to off market deals FIIs and sub accounts (with common beneficiaries) can own only up to 10% equity capital of a company.
A major portion of P Chidambaram’s Budget Speech is likely to focus on infrastructure development, which suffered a slowdown during April-January 2005-06.
The Budget may accord tax holiday for modernization projects of ports and airports in view of the huge investment plans being lined up in these sectors.
FM may revisit petroleum tax structure.
The only tax incentive that finance minister P Chidambaram may provide, says newspaper reports, is to do with cancer and HIV/AIDS drugs. Drug makers other than those producing cancer and HIV/AIDS drugs need not have great expectations about the budget or the new drug policy.
Higher FII investment ceiling & segregation from FDI likely
Excise duty on car, UVs may be cut from 24% to 16%
Taxpayers who feared the imposition of the health cess -- on the lines of education cess -- need not lose sleep. The Budget is unlikely to impose this new cess as the finance ministry is against multiplicity of taxes.
STT rates may be changed
STT may be extended to off-market deals
CEOs demand the removal of fringe benefit tax which is neither simple nor equitable
GOOD NEWS: Budget may NOT introduce any new taxes this year. Hopefully the finance minister might also modify Fringe Benefit Tax to make the industry happy.
Multiplexes llikely to get 50% tax deduction on profits
Even though the stock markets have opened significantly higher and are trading at historic high levels today, some market observers say that irrespective of the proposals the finance minister makes in the Budget 2006-07, the stock markets are likely to drop. The reason? There are no major expectations from this Budget. Analysts say that the markets might witness slip somewhat after the Budget. Unless, of course, the finance minister presents a Dream Budget and makes everyone really happy. But investors can take heart from the fact that these analysts also state that the drop, if there is one, will not be very steep.
Market opens firm. Sensex is up over 40 points. Pharma stock like
Cipla, Dr Reddy’s Labs, GSK Pharma have flared up.
Customs duty on crude palm oil may be cut from 80% to 45%
Section 80IB (7A) may be amended for media cos
The Ministry of Defence demands for a substantial increase in defence funds in the Budget may not be met today by Finance Minister P
Chidambaram. Sources say that the increase in Defence Budget is likely to be about about Rs 89,000
crore, or roughly 7%.
VAT may be introduced for sugar cos
Some Budget expectations: Scrap/modify Fringe Benefit Tax Agro-based products should get full excise exemption Interest income on long-term bank deposits should be made tax-free. Customs duty on steel should go up from 5% to 8%. Excise on passenger cars and utility vehicles must be cut from 24% to 16%, and SED from 8% to nil. 100% depreciation for PCs to boost broadband usage must be allowed Custom duty on capital goods should be reduced from 15% to 10%.
Long-term FD investment may get Section 80C tax benefits
10% cap on voting rights in private banks may go
Rationalisation of FBT provisions expected: E&Y
Finance Minister P Chidambaram has arrived at Parliament to present the Budget.
Rationalisation of FBT provisions expected: E&Y
The Bombay Stock Exchange’s Sensex is up 59.48 points at 10,341.57 even as the markets wait expectantly for the Union Budget 2006-07 to be presented in Parliament by Finance Minister P Chidambaram at 11.00 am today.
Rules on FTC likely to benefit overseas investment: E&Y
FM arrives in Parliament
Finance Minister will arrive in Parliament shortly
AED paid to state may be scrapped for sugar cos
Extension of 150% deduction in R&D benefit likely for auto sector
Excise duty on steel may be halved to 8%
Custom duty on coal may be cut from 5% to nil
Agro & food processing industries may get tax breaks
Govt may create oil seeds & oil development fund
Continuation of 5% import duty on set-top boxes likely
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