The residential property market in India, particularly in the Tier I & II cities, has remained sluggish for the past 12 months, with significantly lower sale volumes, especially when compared to the high absorption rates of 2010. Home loan interest rates now seem to be declining from their cyclical highs but unforeseen tax levies have come at a time when the industry is facing its moment of reckoning.
The Union Budget 2012-13 and the Finance Bill, 2012 has been passed by the Lok Sabha and is likely to be passed by Rajya Sabha this week and then become a statute on President’s assent. Withdrawal of Income Tax (TDS) on purchase of immovable property up to Rs 5 lakhs GAAR provisions postponed to 1.4.2014 Securities transaction tax (SST) on sale of unlisted securities reduced to 0.2 percent No excise duty on purchase of jewellery upto Rs 5 lakh No service tax on deemed sale of goods
Investments and sale to consumers does pick up around Akshaya Tritiya, one of the most auspicious days in the hindi calendar to buy gold, silver , jewellery and to make investment. ‘Akshaya’ means some thing which never diminishes. It is believed that all investments on this day appreciates. Infact, as per astrology, each moment today is auspicious. Though Akshaya Tritiya falls on 24th April, people are celebrating and offering discounts and schemes to lure customers through out the week. People are also eager to bring wealth and prosperity to one’s door steps. Not only this, World Gold Council has offered a 6 percent off on gold coins to celebrate Akshaya Tritya and tied up with Indian posts.
Union Budget 2012-13 could not lift the sentiment of the capital markets in India as the markets do not seem to be influenced or moved by the budget proposals, which are otherwise also not directly in favour of capital market.
At last the budget day arrived and we have heard the budget speech of Finance Minister. Some of us could also read few relevant papers of budget document. On macro view, the budget seems to be an non event so far as providing impetus and further fuel to the economy is concerned, there being no major policy steps in taking a leap into the next decade. This opportunity could have been used, more so 2012 being first year of the new five year plan.
Ahead of the Annual Union Budget later this Week, Select Committee of the Parliament, which has scrutinized the Direct Tax Code Bill (DTC), likely to replace Income Tax Law of 1961 has recommended some very significant tax reforms and tax payer’s friendly measures.
The economic growth is now expected to be marginally over 7 percent, though capital formation and investments have slowed down, global economic and financial conditions are under pressure, inflation has declined but still a cause of worry and fiscal deficit continues to be of concern. In this backdrop, it is no body’s guess as to what the forthcoming budget is going to be.
Dr. Sanjiv Agarwal While India celebrated it 64th independence day early this month, independent India still struggles for freedom in more than many ways. It is indeed time for one and all to introspect in retrospect and prospect as to what we have achieved and what we ought to be, as an individual , as […]
While the Finance Minister has said that his priorities were directed towards making taxes moderate, payment simple and collection of taxes easy for the tax collectors, the changes proposed result in higher indirect tax collection by over Rs. 11000 cores. He admits that there has been a healthy growth in indirect taxes in 2010-11 and as such peak tax rates have not been tinkered with.
