Budget Highlights Feb 2011

Budget Highlights Feb 2011

• Fiscal deficit pegged at 4.6% of GDP for 2011-12.
• Fiscal deficit projected at 4.1% and 3.5% for 2012-13 and 2013-14, respectively.
• Revenue deficit for 2011-12 pegged at 3.4%.
• Revenue deficit for 2010-11 revised downwards to 3.4% from the budgeted estimate of 4.0%.
• Net market borrowings for 2011-12 is budgeted at Rs. 3,430 billion, 2.3% over 2010-11.
• Total expenditure for 2011-12 to increase by 3.4% over 2010-11.
• 1.4% fall in capital expenditure, while 4.1% increase in revenue expenditure over 2010-11.
• Personal income tax slabs changed:
• Income upto Rs.1.8 lakhs – nil.
• Income between Rs. 1.8 lakhs and Rs. 5 lakhs – 10%.
• Income between Rs. 5 lakhs and Rs. 8 lakhs – 20%.
• Income above Rs. 8 lakhs – 30%.
• Incomes of senior citizens between 60 and 80 years of age, to be exempted upto Rs.2.5 lakhs and for those above 80 years, exemption applicable upto Rs. 5 lakhs.
• Standard rate of excise duty on all non-petroleum products to be maintained at 10%.
• Minimum Alternate Tax (MAT) rate to be increased from 18% to 18.5%
• Rate of service tax retained at 10%, but coverage extended
• Disinvestment receipts for 2011-12 estimated at Rs 40,000 cr.
• Government to move towards direct transfer of cash subsidy for kerosene and fertilizers.
• Foreign investors who meet Know Your Customers (KYC) norms to be allowed to invest in Indian equity mutual funds.
• FII limit for investment in corporate bond with residual maturity of over five years issued by companies in infrastructure sector, is raised by US$ 20 billion to US$ 25 billion
• Rs 6,000 cr allotted to public sector banks to maintain a Tier 1 CRAR of 8% during 2011-12
• Direct Tax Code to be implemented by April 1, 2012
• Allocation to infrastructure at Rs. 2,14,000 cr for 2011-12, 23.2% higher over previous year