Dec 04, 2023
Dec 04, 2023
A day after the federal budget, people across India wondered if they were really better off and problems on the ground such as high commodity prices and the general fall in living standards will be adequately addressed. The most tangible measure proposed by Finance Minister Pranab Mukherjee concerning the average tax payer is the hike in exemption limit to Rs.180,000 from Rs.160,000. People -- although they have welcomed the move -- feel it is hardly worth much in real terms.
"From what I can understand, all I will gain from this hike is Rs.171 per month. That is what I paid extra for onions in December! It's not even enough to adjust for inflation, which was in double-digits most of this fiscal," said C.S. Kartik, an accountant. "But I am happy the stock markets have reacted positively. It was going down and down. At least my investments are now coming back to the levels I acquired them. A 4-percent gain in two sessions is heartening," Kartick, who works for a private firm, told IANS.
In a departure from the past when stock markets had tended to move southward after the presentation of the federal budget, the sensitive index (Sensex) of the Bombay Stock Exchange (BSE) ended with a gain of 0.69 percent Mondan and 3.5 percent the next day.
Housewives had a different take. Already overburdened by the high prices of milk, fruits and vegetables, they heaved a sigh of relief when the budget proposed no extra levies on other items of household consumption -- from edible oils to airconditioners and mobiles. But they also felt their occasional indulgence of dining out will take a hit due to service tax measure. "Most good restaurants serve liquor. They are family places. This tax simply means every meal out will be costlier," said homemaker Rakhi Khanna of Noida. "I don't see any drastic change in the prices of essential items which we use everyday like pulses, rice, vegetables, eggs, milk, cooking gas, petrol," added Rukmini Mohanty, a housewife in Bhubaneswar.
Items that could become cheaper due to the budget proposals include automobiles, low-end housing loans, diapers, sanitary napkins, homeopathic medicines, agarbatti, raw silk material. On the other hand, what could prove dearer is treatment in airconditioned private hospitals, meals at restaurants serving liquor, hotels charging more than Rs.1,000 per room per day, legal services, air tickets and branded jewellery and clothes. Nevertheless, the elders are happy that the income tax exemption limit has been set at Rs.500,000 for tax payers above 80 years, while reducing the age from 65 to 60 years to become eligible for tax sops to senior citizens.
"At this stage of my life, when I have to pay for my medical expenses, which is more than my total income, this measure will come as a boon to me," 82-year-old retired technocrat Alok Kumar Srivastava told IANS.
Even the corporate sector -- which was being forewarned by some columnists about the end to fiscal stimulus and some harsh measures to rein in inflation -- was happy, since the budget reduced the tax surcharge and promised higher spending on infrastructure. They also called as pathbreaking the proposal for direct cash transfer of subsidies for kerosene, fertiliser and cooking gas for the por and said it will remove the inefficiencies that has for long plague the delivery of welfare measures.
But Finance Minister Pranab Mukherjee, himself, did not sound too optimistic a day after his budget and said the country continued to face both internal and external challenges like spiralling oil prices, and must remain ever so vigilant. "The challenge before the government and the Reserve Bank of India has been to support the growth process without compromising on price stability," he told the annual meeting of the Federation of Indian Chambers of Commerce and Industry Tuesday. "The task has not been easy, but we are making progress."
The finance minister also warned about the possibility of rising global commodity prices adding to domestic inflationary pressures, which has pushed headline inflation to over 8 percent, and added: "We are already confronting such a situation."
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