Service tax is a disincentive

COMMENT/ Shikha Sharma, CEO&MD, ICICI Prudential Life

The Budget's main thrust was broadly as expected, and in line with the Common Minimum Programme, the pleasant surprise came in the form of only a marginally higher overall tax burden - both direct and indirect, which is largely contrary to expectations of industry and market.

While small savings rate has been maintained at the earlier level, we look forward to a rationalisation of the same, as mentioned by the finance minister, in the next budget.

The liberalisation of the insurance sector has thus far been handled very well. The world over, pensions have been driven by tax exemptions.

It is only such measures that will encourage the majority of people, who have no secure savings for their retirement, to build a substantial retirement kitty.

The current limit of Rs 10,000 under Sec 80 CCC (1) is inadequate to build a reasonable retirement kitty and we were hoping that the government this year would increase the limit to boost retirement savings.