FM Arun Jaitley on July 10 doled out income tax sops by raising threshold exemption and investment limits by Rs. 50,000, raised duties on cigarettes, tobacco, pan-masala and aerated drinks, widened service tax base and announced measures to spur growth manufacturing and revive investor confidence. Without tinkering with the tax rates and allowing continuing 3% education cess on all tax payers, he provided encouraging signals for domestic and foreign investors offering not to "ordinarily" bring about any tax change retrospectively which creates a fresh liability. Jaitley ruled out resorting to retrospective taxation and said "ordinarily we will not legislate to create fresh liability." The budget for 2014-15 raised the threshold I-T exemption limit from Rs 2 lakh to Rs 2.5 lakh and investments under 80C by Rs 50,000 to Rs 1.5 lakh, and raised interest exemption on housing loan on self-occupied property by Rs 50,000 to Rs 2 lakh. The Budget makes cigarettes, tobacco, pan-masala, gutka and cold-drinks costlier by raising excise duties while CRT TVs used by poor, LCD and LED TV panels of less than 19-inches will be cheaper through cuts in customs duties. The FM said govt will promote FDI by raising the cap to 49% in Defence and Insurance with full Indian management and control. The Budget raises defence spending by 12.5% to Rs 2.29 lakh cr. The total expenditure estimates stand at Rs 17,94,892 cr. The Budget pegs the fiscal deficit for the current fiscal at 4.1% of the GDP and 3.6 and 3% in 2015-16 and 2016-17 respectively. In 45 days, this is the best he could do, he said. "India today needs a boost for job creation. Our manufacturing sector in particular needs a push for job creation," he said. The budget contained a slew of measures to fast-track projects mostly in public-private-public partnerships, which finds renewed focus in the minister's speech. Union ministers were all praise for the first Budget of the Narendra Modi govt saying Jaitley has done a great job and brought wonderful, growth-oriented proposals that would boost the economy and help the common man. Describing the general Budget as a 'sanjeevani' (new life) to the "moribund economy", PM said it converts hopes and aspirations of the people into trust and is in line with his govt's endeavour to bring India out of crisis. "This Budget is a new ray of hope for the poor and downtrodden sections of society," he said. HM Rajnath Singh rejected charge by Congress leaders that the Budget was "over ambitious". "It is not over ambitious, it is realistic. It is poor-friendly, farmer-friendly, youth-friendly, women-friendly and senior-citizen friendly," he said. India Inc welcomed Modi government's maiden budget, saying it sets the tone for attaining higher growth trajectory, job creation and attracting much-needed investments for an economy grappling with multiple challenges. "I think the approach of creating a stable business environment to attract investment and boost economic growth, that direction comes across clearly," CII President Ajay Shriram said. However, Senior JD(U) leader Nitish Kumar described as "disappointing" the maiden general budget of Modi govt as there was nothing for backward states like Bihar to cheer "acche din" (good days). "There is no mention of either special status for Bihar or special package, the promise which was made during Parliamentary election," Kumar said. WB CM Mamata Banerjee dubbed the Modi regime as a 'government of the FDI, by the FDI and for the FDI' while Opposition parties termed the budget a "disappointment" and an "anti-poor" exercise which can "benefit only the rich". Despite raising expectations, the budget has turned out to be a "missed opportunity" for BJP, they said as they begun by expressing apprehension that raising the tax exemption limit by Rs 50,000 was just "inadequate" when inflation was running high. "This budget has nothing for the 'aam aadmi' and the poor. They have announced tax concessions to help corporates and big industrial houses." In a debate moderated by TIMES NOW's Editor-in-Chief Arnab Goswami, experts and panelists discuss the Modi government's maiden general budget and its implications, and whether it is a pragmatic, practical and prudent budget as some claim or whether the budget lacked a big idea as some question.

• published: 11 Jul 2014
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