King's Speech - Union Budget 2012-13

 "For every benefit you receive a tax is levied."

Another year of Budget and another year of expectations. Lemme tell you that being Finance Minster of India is not an easy job. Especially when your name is Pranab Mukherjee who has to think on different fronts, their outcome and then delivers a speech to do a balancing act between Industry (main source of Revenue in terms of tax and even funding the Party ) and Aam Aadmi (the actual Vote Bank considering General Elections in Mind).

With Assembly Elections over in five states and Congress suffering defeat in most of the states barring Manipur one was expecting some major tax reforms for middle class people i.e. Aam Aadmi.

Finally the Cat is out of the bag so let’s analyze what Pranab Da has to offer to different sections of the society.

“If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”

Black Money

"The man whose only pleasure in life is making money, weighs less on the moral scale than an angleworm." 

In his last speech he mentioned a 5 Point Strategy to curb Black Money. Last year was a great year in terms of movement where whole country got united and pressure was exerted on Govt. by Anna Hazare and Baba Ramdev regarding Black Money in Swiss Accounts. Indian Govt. with the help of DTAA and other agreements with Swiss Govt. were able to get information regarding account holders but then also it was facing a major problem due to a particular section of I.T. Act. , due to which it can’t open the cases of more than previous 6 A.Y. But now this limit has been extended quite rightfully and expectedly to 16 years.

GST and DTC  

How many times our F.M. has made announcement regarding implementation of GST and then deferred it. Let’s see will GST make way in August or not. If yes then there is no point of introducing a negative list of taxable services when whole system is gonna change. Well still it has a long way to go and making Centre and State play on same frequency is quite a tedious task.

"If all the economists were laid end to end, they'd never reach a conclusion"

In case of DTC and I am sure it’s gonna implement soon but right now it is in finishing stage and was not fully prepared to get implemented from April 12.

Rise in Service Tax and Excise Duty

"There is no such thing as a good tax."

Well Indirect Taxes are major sources of Revenue for Centre and I know that many of you will argue that this is not “Aam Aadmi ka Budget” because it will increase the price of Goods and Services. But friends considering the current financial scenario and deficit our FM has no other way to fight against it. If principle services like Education and Medical are not affected then we can excuse Dada for the above rises.

But I can sense the upcoming rise in prices of Petrol, Diesel and Crude Oil.

Vodafone Case

Well this was quite expected as SC decision went against the revenue and therefore the respective provision has been amended retrospectively from 1961.

Indian Govt. can allow India to become Tax Heaven but this will have a long lasting impact on future Mergers and Acquisitions.

We can even expect a long discussion on it.   

Tax Slab

Well this is the major failure of this Budget. Only 20000 increase in the basic slab and keeping Women Assessee at par with others has done no good to Government.

We were expecting a lot from this section.

At the end we can say that this Budget is a mix bag but our FM couldn’t have done much about it.