Sops and imposts in Budget, net revenue gain of Rs 41,440 cr

In a mix of sops and imposts, the General Budget today proposed a marginal raise in income tax exemption limit of Rs 20,000 but hiked service tax and standard excise duty by 2% across the board to net an additional Rs 41,440 crore a year.

The Budget for 2012-13 presented by Finance Minister Pranab Mukherjee in the Lok Sabha, however, left corporate tax rate and peak customs duty unchanged while the import duty on gold bars and platinum and excise duty on cigarettes, bidis, pan masala and chewing tobacco were raised.

Customs duty on completely built large cars SUVs and MUVs of value exceeding $40,000 (Rs 20 lakhs) was also raised.

While the direct tax proposals in the Budget will result in a revenue loss of Rs 4,500 crore, indirect tax proposals would result in a revenue gain of Rs 45,940 crore. Thus the tax proposals lead to a net gain of Rs 41,440 crore.