On the indirect tax front, the finance minister has kept the peak rates of customs duty, excise duty and service tax unchanged. He expects to garner additional Rs. 4,700 crore in the current fiscal year through the implementation of various indirect tax proposals.
This includes, major increase in the tax rates of deluxe goods such as SUVs, motor cycles and mobile phones. Overall, this budget aims at realising the additional fund requirement without burdening the common man. The changes proposed are unlikely to entail higher costs for the general public.
The increase in customs duty on set-up boxes would not be happy news for TV viewers in the metros. Similarly, the increased tax rate on cigarettes and restaurants may take the zest out of the common man's small vices.
Indians returning home have reason to cheer. The finance minister has increased the value of duty free import of gold by a female passenger from Rs. 20,000 to Rs. 1, 00,000. Besides, import duty on semi-precious stones, too, has been reduced from 10% to 2%. Import duty on specific machineries used in manufacture of leather goods and footwear has also been cut from 7.5% to 5%.
There is bad news for large-home buyers. The abatement available construction services on flats of more than 2,000 square feet or value of more than Rs. 1 crore would be reduced from 75% to 70%. This would push up the cost of house ownership.
Last but not the least; the minister has unveiled a 'Voluntary Compliance Encouragement Scheme' to bring in delinquent tax payers into the service tax fold.
In short, the man on the street can rejoice as this budget does not add much to his cost of living.