Consumers have already faced a railway price rise, petrol and diesel increase and rising inflationary pressure. Now, all eyes are on Finance Minister Arun Jaitley to provide some semblance of the much-touted ache din.
But going by the record and the government finances, things might not change dramatically. The Bharatiya Janata Party-led National Democratic Alliance came to power for the first time in 1998 (for 1998-99). Finance Minister Yashwant Sinha, in his first budget, had made some minor changes in direct taxes – the exemption limit was increased from Rs 40,000 to 50,000. Standard deduction or basic exemption limit for incomes of Rs 1 lakh was raised from Rs 20,000 to Rs 25,000.
His biggest gift to income-tax assessees was increase in the medical reimbursement from Rs 10,000 to Rs 15,000, a number that has remained unchanged for a decade and a half (see table). Rajesh Srinivasan, partner at Deloitte, Haskins and Sells LLP says that Jaitley could start by revising this limit first.
There are many other expectations, ones Jaitley may or may not be able to deliver on. Like, increasing the basic income tax exemption and Section 80C limit.
Reports say Jaitley is more likely to disappoint the taxpayers on these two fronts. Experts are on the same page. Chartered accountant Parizad Sirwalla says on the personal taxation front there are very little that the finance minister might do this time. “Upwards revision in slab rates may not come about so soon,” she says.
Reason: The economic condition of the country is not very good. The monsoon has been below expectation. India is fearing an oil crisis due to the Iraq troubles. And the new government did not get enough time to prepare for this Budget.