Some positive signals to control current account deficit in Union Budget
2013-14
The Union
Budget 2013-14 has failed to meet high expectation from the common man and
Dalal Street. There is no any announcement for revitalise the investment cycles
or attract savings in capital market. The confusion over retrospective changes
in Section 90A of Income Tax Act relating to relief to foreign investment is
not good. As foreign investment is very important factor to fill in the gap of
current account deficit.
There are some
positive signals by government also. To control current account deficit and to
check the increasing gold demand government has increased the income limit from
10 lakh to 12 lakh for eligibility for Rajiv Gandhi Equity Savings Schemes
(RGESS).
The government
has reduced the planned expenditure for rural development, agriculture and
social sector as against the expected increase in planned expenditure.
For first-time home buyers during 2013-14 availing
loan up to Rs 25 lakh and having the cost of property of less than Rs 40 lakh
will be eligible for additional deduction of interest of up to Rs 1 lakh. (At
present Rs 1.5 lakh tax exemption on interest paid on housing loan under
section 24A)
The government is also planning to launch
inflation indexed national savings certificates subject to RBI consultation.
In any immovable property sell transaction
except agriculture have to deduct TDS of 1% on the value of property where the
value of deals exceeds Rs. 50 lakh.
The surcharge has been increased from 5% to 10%
for those companies whose revenue above Rs 10 crore. Additional 10 % surcharge
has been introduced for those individuals who are above 1 crore income slab.
Dividend Distribution Tax (DDT) increased from
5% to 10%. Custom duty on set top boxes, specific excise duty on cigarettes and
excise duty on SUV increased. Import duty on gold increased from 4% to 6%.
The above mentioned step has given positive
signal from government side to control current account deficit.
Regards,
Arvind Trivedi
Certified Financial Planner
