The UPA government has taken a risk for the common people instead of market this time. While IT exemption limit has been raised (though not upto desired level) and fringe benefit tax and 10 percent surcharge on personal income tax have been removed on one side the schemes like National Rural Employment Gurantee Scheme (NAREGA), Jawaharlal Nehru National Urban Renewable Mission (JNNURM), Indira Grameen Awaas Yojna and several other schemes of social sectors have recieved a major boost in the Budget 2008-09 presented by Finance Minister Pranab Mukherjee today in the Lok Sabha. The robust plan of one hundred thousand crore for infrastructure sector is clear indication that the social sector and employment generation have been the guiding force in the budget.

Education too has been given ample attention in terms of allocation of budget. The Finance Minister has allocated 2131 crore alone for IITs, 1740 for minority, 50 crore for two new campuses of Aligarh Muslim University (AMU) i.e. in Murshidabad (W. Bengal) and Mallpuram (Kerla).

But the fiscal deficit remained a major concern in the budget as it has increased upto 6%. Though according to Finance Secretary Ashok Chawala the fiscal defecit will be reduced by 4% in the next three years as high fiscal defecit is not sustainable. Chawala says that there are five reforms in the budget. These include tax, power, fertilizers, oil and disinvestment.

Highlights of Budget 2009-10.

* IT exemption limit raised

* Limit raised by Rs 15,000 for sr.citizens (65 yrs & above)

* Limit raised by Rs 10,000 for general tax payers & women

* 10% surcharge on personal income tax scrapped

* Fringe Benefit Tax, Commodities Transaction Tax abolished

* Corporate Tax unchanged; Minimum Alternate Tax hiked to 15%

* Legal services brought under Service Tax net

* Cosmetic & plastic surgery become taxable services

* Rs 3472 cr for Commonwealth Games, up from Rs 2112 cr

* LCD TVs to become cheaper; Set-Top boxes costlier

* Stimulus for print media for another six months

* Branded jewellery to become cheaper; excise duty goes

* Govt plans to bring back economy to high growth of 9%

* GDP growth dipped to 6.7% in FY’09

* Fiscal deficit up from 2.7% to 6.

Reactions :

Both the Prime Minister and former Finance Minister P Chidambaram have said that budget will acclerate growth in the country. Higher Plan outlay in the Budget will provide stimulus to the economy and accelerate the growth process, Home Minister P Chidambaram said. “The Budget for 2009-10 has been prepared with great skill and wisdom with the objective of stimulating the economy and returning to the high growth path,” Chidambaram, said in a statement on the Budget.

Delhi’s Chief Minister Sheila Dikshit and Finance Miniser A K Walia have welcomed the budget and said that it is pro-people. Sheila Dikshit has described Union Budget 2009-10 as a development-oriented and pro-poor budget which would take forward our country.

It reflects commitment of the Union Government to fulfil promises made to the Aam Aadmi. It is, in fact, a beginning of implementation of commitments made by an elected government. Dikshit added that this budget would result in an inclusive growth. An adequate provision has been made for Housing and Road sectors.

Lawyer’s pain :

The budget has disappointed lawyer community as they have been brought under service tax net. This is the situation when the Manmohan Singh’s cabinet has fairly good number of lawyers. In fact, the Finance Minister Pranab Mukherjee himself is a law graduate. But more disappointment came when the annoucement was made about giving relaxation for Chartered Accountants from the service tax net. Now the lawyer community is planning to raise the issue with the party and the FM.