Saturday, March 1, 2008

Budget 2008 Brings Cheers To Middle Class

New Delhi: The Finance Minister brought cheer to lakhs of middle class families just as he announced the cut in taxes. The loan waiver for farmers may have been on expected lines, but the real surprise was the when the Finance Minister also extended his generosity to the tax paying middle class.

Finance Minister, P Chidambaram announced, "Salaries up to Rs 1,50,000 — nil, Rs 1,50,000 to Rs 3,00,000 — 10 per cent, Rs 3,00,000 to Rs 5, 00,000 —20 per cent, and Rs 5,00,001 and above 30 per cent.

The above line from the Finance Minister brought a smile to the faces of lakhs of middle class families like the Gulatis, a smart rejig of the income tax slabs bringing a hefty reduction in income tax across board, especially for those who are at the lower end of the tax bracket, women and senior citizens.

Advocate, S K Gulati says, "Our Finance Minister has given relief by increasing the tax limit to the general public. I'm happy about the cut in taxes."

Dr Shravan Kumar Chhabra says, "Inputs for the drug manufacturers duty cut have been made and that will go a long way in cutting down the cost of the medicines, also the 2.25 lakh tax cut for senior citizens makes me happy"

And the benefits will be substantial with an income of exactly Rs 5,00,000 per annum; one will now pay Rs 55,000 compared to Rs 99,000 earlier, which is — a neat saving of Rs 44,000.

The FM has also made a large number of items cheaper to buy, expect a cut of up to Rs 15,000 in the price of small cars, and motorcycles and scooters could be cheaper by Rs 2000.

Water purifiers and medicines have also got cheaper across the board.

The ladies of the Gulati household have mixed views on the budget as the lady of the house Lakshmi Gulati says, "Except water purifiers and cereals there is nothing really for housewives, I am disappointed."

For the salaried class there is very little to fault Mr Chidambaram, but for those with an inclination towards equities, take note that short-term capital gains tax has been hiked to 15 per cent from 10 per cent earlier.

So think before you do those quick daily trades as the FM's message is clear — it's better to be a long-term investor than a day trader.

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