| DIRECT TAXES
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| Income tax exemption limit hiked to Rs 1,50,000; limit for women raised to Rs 1,80,000 and for senior citizens to Rs 2,25,000.
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| Additional deduction of Rs 15,000 for individuals paying medical insurance premium for parent or parents.
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| No change in the corporate income tax and surcharge.
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| Senior Citizen Saving Scheme 2004 and Post Office Time Deposit Account brought into Section 80C savings basket.
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| Reverse mortgage income for senior citizens not to be taxed.
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| Income from saplings or seedlings grown in nursery exempted from tax.
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| Weighted deduction of 150% on in-house R&D expenditure allowed to companies for seed production and agricultural implements manufacturing.
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| Benefits of amortisation of certain preliminary expenses allowed to income tax payers in services sector.
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| Corporate debt instruments issued in demat formats listed on recognised stock exchanges exempted from TDS.
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| Crèche facilities, sponsorship of an employee-sportsperson, organising sports events for employees and guest houses not to attract fringe benefit tax.
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| Parent company allowed to set off dividend received from its subsidiary company against dividend distributed by the parent company, provided dividend received has suffered dividend distribution tax and parent company is not a subsidiary of another company.
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| New sub-section introduced in Section 80-IB to provide a 5-year tax holiday to hospitals outside urban agglomerations, especially in Tier II and III cities, that start functioning between April 1, 2008 and March 31, 2013.
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| Five-year tax holiday for two, three or four star hotels established near UNESCO-declared world heritage sites that become operational between April 1, 2008, and March 31, 2013.
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| Coir Board to be exempted from income tax.
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| Tax rate for short-term capital gains raised to 15%.
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| Securities Transaction Tax to be treated like any other deductible expenditure against income.
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| Commodities transaction tax introduced on the lines of securities transaction tax on options and futures.
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| Banking cash transaction tax withdrawn from April 1, 2009.
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| Service Tax
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| Asset management service provided under ULIP; services provided by stock/commodity exchanges and clearing houses; right to use goods where VAT is not payable; and customised software brought under services tax net.
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| Service tax exemption limit for small service providers raised from Rs 8 lakh to Rs 10 lakh.
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| Central Sales Tax
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| CST reduced from 3% to 2%.
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| INDIRECT TAXES
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| Customs duties
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| No change in peak rate of customs duty.
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| Duty on project imports reduced from 7.5% to 5%; 4% special CVD to be imposed on specified projects in power sector.
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| Duty on steel and aluminium scrap abolished.
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| Duty on specific life saving drugs and bulk drugs meant for manufacture of such drugs halved to 5%.
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| Specified parts of set-top boxes and raw materials for information technology and electronic hardware exempted from import duty.
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| Duty on convergence products used in information, communication and entertainment sectors slashed from 10% to 5%.
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| Duty on machinery for sports goods manufacture reduced from 7.5% to 5%, total exemption for specified raw material for sports goods.
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| Helicopter simulators exempted from import duty.
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| Crude and unrefined sulphur for fertiliser production to carry 2% customs duty instead of 5% earlier.
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| Naphtha for manufacture of polymers to be subjected to 5% customs duty; duty exemption to continue for fertiliser manufacture.
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| Duty on vitamin and mineral premixes slashed to 20% and on phosphorice acid to 5% to cut down poultry feed cost.
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| Bactofuges used as additives for prolonging milk shelf life exempted from duty.
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| Duty on rough cubic zirconia removed; polished cubic zirconia and rough coral to attract 5% duty instead of 10%.
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| Export duty on chrome raised from Rs 2,000 to Rs 3,000 per tonne.
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| Excise duty
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| General CENVAT rate reduced from 16% to 14%.
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| Excise on pharmaceutical sector halved to 8%.
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| Excise on small cars, two and three wheelers down from 16% to 12%, hybrid cars from 24% to 14%.
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| Buses and chassis to attract 12% excise.
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| Ad valorem part of excise duty on unbranded petrol and diesel abolished and replaced with an equivalent specific duty of Rs 1.35 per litre; only specific duty of Rs 14.35 a litre on unbranded petrol and Rs 4.60 a litre on unbranded diesel retained.
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| Excise on paper and other items made from non-conventional raw material and some varieties of writing and printing paper down from 12% to 8% .
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| Mass consumption items like composting machines, wireless data cards, packaged coconut water, tea and coffee mixes and puffed rice exempted from excise.
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| Excise on water purifying devices, veneers and flush doors, sterile dressing pads and some packaging material and breakfast cereals halved to 8%.
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| Anti-AIDS drug Atazanavir exempted from excise.
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| Refrigeration equipment (compressor, condenser, evaporator) for above 2-tonne units using 50 KW power exempted from excise on end-user basis.
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| Excise on bulk and packaged cement to be on par at Rs 400 per tonne or 14% ad valorem; for cement clinkers Rs 450 per tonne.
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| Excise on packaged software up from 8% to 12%.
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| Excise on non-filter cigarettes to be at par with filter cigarettes.
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| Excise duty on 1% (NCCD) on polyester filament yarn and levy shifted to cellular mobile phones. |
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Content Guide
