Budget 2015

On 28/2/2015 Arun Jaitley presented India’s budget for 2015-16. Sensex and Nifty went up and down during the day and finally ended up. Looks like some people managed to pull them up.
Narendra Modi should replace Arun Jaitley as Finance Minister with someone suitable.
Firstly, Finance Minister should be physically fit to read the full budget speech standing. Arun Jaitely is unable to do that. This happened last time also.
Secondly, Arun Jaitley is a misfit as Finance Minister. In an interview to Lok Sabha TV after budget presentation Arun Jaitley said “Only 3-4% of the country’s population pays taxes.” This is false. This is unpardonable coming from the Finance Minister of India. All Indians pay taxes directly or indirectly. Those who pay Income Tax may not be more than 4% but that is just one tax of the many which India has. Service Tax, VAT, excise duty, customs duty, entertainment tax, turnover tax, Cenvat, Modvat, MAT, LBT, octroi and other taxes are paid by Indians. The products we buy in shops are inclusive of all taxes.
My comments about the budget are as below:
Any budget that is a deficit budget is a bad budget. Total expenditure for 2015-16 is 17,77,477 crore rupees, i.e., around 18 trillion rupees. Borrowings are around 4.56 trillion rupees. This deficit needs to be zero.
Good to abolish Wealth Tax. Loss of income is more than compensated by additional surcharge of 2% on income of 1 crore rupees or above.
Bad to increase Service Tax from 12.36% to 14%. This affects most Indians. Mobile and DTH charges will go up. Besides there is provision for 2% Swacch Bharat cess on all or certain services. This means Service Tax can be 16%.
Should have done away with NREGA. Instead there is additional grant for NREGA. Just a day before Narendra Modi had said NREGA is a living example of Congress/UPA folly.
The decision to cut Corporate Tax by 5% from 30% to 25% over 4 years and do away with exemptions made many people say this is a pro-Corporate budget.
There should be no discrimination between states. Special assistance to Bihar and West Bengal should have been avoided. Orissa Chief Minister Naveen Patnaik is unhappy.
There is a proposal for a new law to curb holding of black money abroad. What about black money within India? We have to see what the intention is when the government introduces Benami Transactions (Prohibition) Bill.
Corporate Debt Restructuring should have been abolished. There is nothing about punishing people who default on payment of bank loans.
UPA brought GAAR but deferred its implementation. Now BJP had deferred it by two years. Either GAAR should be implemented or abolished. Deferring is not good.
Increase of excise duty on cigarettes, cigars, cigarillos and other tobacco products in justified as they are injurious to health. What is the justification for levy or increase of excise duty on milk packs, peanut butter, mineral water, aerated water, and such items?
Setting up of news AIIMS, IITs , IIMs and other institutions should be avoided. Cost of higher education of institutions including universities already present should be recovered from students. If announcements of setting up of institutions have been made in previous budgets but work has not started they should be scrapped.
Reactions by politicians to budget have been predictable. Those of BJP said it is a good budget. Those of Congress and Left Front said the budget has nothing for the poor. TV channels should stop inviting politicians to discuss the budget.

Updated: March 3, 2015 — 7:47 am

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  1. Well-presented! Deficit budget is good provided the borrowings are used for capital expenditure. In our case this is only partly true, hence it is bad.

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