UNION BUDGET 2011-2012
( A COMMON MAN PERSPECTIVE )
Presented by:
Sonam Kumari
Tarun Chandra Gupta
BUDGET & COMMON MAN
A common man in the society can be in form of any person who
derives utility from the society or provides services to the society,
in such a case, a common man can be in form of :
A farmer
Salaried class person
A housewife
A student etc.
With budget session in the corner, every section of the society has
some expectations from it in some way or the other and each has
certain desires that need to be fulfilled by the Budget as it has a
major role to play in attaining the economic sustainability of India.
COMMON MAN
EXPECTATIONS
The Aam Admi is expecting that the FM present this budget
with experience, perspective, vision and a heart! Though
there are certain things which are hard to control
still, people have a lot of expectations from the Finance
Minister.
• Further Dilution of Tax Slabs
• Reimbursement of Medical Expenses
• Raising the Rs. 1 lakh deduction limit
• Exemption Limit for Various Allowances
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HOW FAR THE BUDGET MET
THE EXPECTATIONS ??
Budget impacts homemakers
• The budget has levied service tax on hospitals and diagnostic
service providers and with this the end user, the patients, will
end up paying much more than earlier.
• Raising the priority home loan limit from Rs 20 lakh to Rs 25
lakh is good news for the low-income group segment.
• On the back of raving inflation and rising input costs, the
prices of petrol are likely to be hiked by Rs 2 per liter.
• Customs duty on precious metals increased where jewellery
purchase just got more expensive .
Relief to the senior citizens
• For senior citizens, the increase in basic exemption limit has
been enhanced to Rs 250,000 p.a. from Rs 240,000 p.a.
• The age for qualifying as a senior citizen has been lowered to
60 years from 65 years.
• The “very senior citizen” category proposes to cover resident
citizen of 80 years and above. The basic exemption limit for
this category has been capped at Rs 500,000.
IMPACT TO FARMERS
• This was the most focus part of the budget and agricultural expected
to grow at the rate of 5.4% in financial year 2011-12.
• Raising target for agricultural target to flow 4.75 lakh crore in
financial year.
• The credit flow in farming increase from 3.7 lakh crore to 4.7 lakh
crores.
• The agricultural loan interest rate will remain 7% but the subsidy
provided on time payment of loan will be 3% of interest.
• To provide 3000 crores to crop producer in rural areas.
•Allocation for the farm development hikes to 7860 crores which
was earlier 6755 crores.
IMPACT ON STUDENTS
Total fund allotted to education sector for FY’11-12 is Rs.52000 cr.
This budget focused upon basic as well as higher education as 21%
of total amount would be spend on higher education. Following
institutes mainly get benefited by this budget. I.I.T Kharagpur – Rs.
200cr, I.I.M Kolkata –Rs.20 cr. (for financial assistance) , Delhi
school of Economics-Rs.10cr. , Madras school of economics-Rs.10
cr. , Rajiv Gandhi institute-Rs.20cr.
Rs.21000 cr is compulsory allotted for child education .Scholarships
amount of Post metric SC &ST students who are around 409 lacks
have been doubled.
Positive Moves
1. Cash subsidy provided to people BPL.
2. FII investment through Mutual Funds- crucial for
Indian Economy.
3. Tax free bonds of Rs. 30,000 crore proposed to be
issued during FY 2011-12.
4. Hotel accomodation and restaurants added as
new services for levying Service Tax.
Cont….
5. Qualifying age reduced for senior citizens i.e. from
65 yrs to 60 yrs.
6. Introduction of new simplified income tax return
form “Sugam”.
7. Good move in agricultural sector.
Critical Analysis
Relief of tax exemption for working men below
expectation.
Introduction of Very Senior Citizen category -not
useful for middle lower class.
No change in tax slab for women assessee.
Thumbs down on taxation on services
provided by hospitals.
Cont…
Salaried employee having no other source of income
is exempted from filing the return.
Scholarship for SC/ST students – Why only for SC/ST
students?
Raising the priority home loan from Rs. 20 to Rs. 25
lakh – not useful for metropolitan cities.
5 point strategy to deal with Black Money – no
expectation if the system still remains corrupt.
Conclusion :-
The Union Budget 2011 focused on Infrastructure,
Agriculture and Education which is beneficial for long
term perspective. The growth of these sectors makes
the economic growth sustainable.
But if we look at the short term perspective this
budget cannot be called as “ Aam Aadmi ka Budget”.
