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How do Finance Minister P Chidambaram's Budget 2008-09 proposals impact the common man, industry, stock market, middle class, farmer, housewife, financial sector and the poor?
Mudit Jain, president of DCW, a Rs 1,000-crore (Rs 10-billion) company, responded to many such readers' queries. Here is the transcript:
Mudit Jain says, Hello everyone good afternoon. I am ready for your questionsTina asked, Hi, PC said "customizable" software will be brought under service tax net? What does this mean? I suppose every project undertaken by the IT sector is "customizable" - is it not?
Mudit Jain answers, at 2008-02-29 14:54:05You are quite right. I also assume all software is customizable and hence will be all taxed.
karthik asked, Any tax relif for self disablities?
Mudit Jain answers, None in this budget.
ritu asked, Hi Mudit, My question is, what would be the impact of Budget 2008 on Indian IT industry?
Mudit Jain answers, All software will be brought under the net of service tax.
umesh asked, what shall be the impact of sixth pay commision on indian economy in terms of demand and inflation
Mudit Jain answers, It will lead to greater taxation has the government will have to tax its citizen more to fund this.It will increase spreading power and even if this leads to more infalation it is not a problem has it is money in hands of people and not the government.
mitesh asked, corrugated box duty % ?
Mudit Jain answers, Same has last year. Peak rate is 10% plus additional duties.
LPDeo asked, What exactly is the loan waiver for Farmers having more that 2 Ha? Whether the 25% waiver includes Interest portion? Would it benefit farmers having loan whose 1st instalment of repayment will start in April 08, if they chose?
Mudit Jain answers, The fine print of the budget will have to be read to answer your question.
umesh asked, can the budget boost manufacturing sector
Mudit Jain answers, No. Our manufacturing sector needs a revolution in the current way of government thinking to increase it.
ravi asked, What will be the impact on price of new vehicles?
Mudit Jain answers, They should come down if manufacturers pass on the excise cut to consumers. If they do not then there will be no change.
vivek kumar asked, this budget looks good for common people. isnt it?
Mudit Jain answers, Not really. It is good for small farmers only.
suryap asked, will there be any cascading effect on the banking sector and its services by waiver of farmers' lona...and the long term impact on the banking stocks?
Mudit Jain answers, There certainly should be but it was mentioned that the government will reimburse the banks. The fine print of the budget is to be read to know the details.
joshi asked, how much debt to be waived to farmers
Mudit Jain answers, Rs.60,000 crores on the face of it.
RDRAJA asked, What about bank Fixed Deposi it interest rate
Mudit Jain answers, NO mention in the budget of any changes.
rahul_poladia21 asked, what is import rates on steel market
Mudit Jain answers, Steel companies may fair better has they can imported meltable scrap duty free. So steel companies will fair better if they import scrap.
SITARAMAN asked, WHAT IS THE IMPACT OF BUDGET ON SHARE MARKET?
Mudit Jain answers, Negative has short term capital gain tax has increased and no stimulas for industry and service sectors.
rehmatali asked, any changes in service tax slab
Mudit Jain answers, No change in rates but more services are included under this tax.
VICKY asked, What will be the impact on your industry
Mudit Jain answers, No impact in the chemical industry, neither positive or negative.
sss asked, they have inclused the tax to 15% on short term capital gains
Mudit Jain answers, Increased it to 15% from existing 10%.
rajesh asked, Hi, what is future of Reliance [Get Quote] power ,ambuja cement and suzlon energy. what sector is bright after this budget.
Mudit Jain answers, No impact on companies mentioned by you. Only good for small farmers and automobile industry.
SITARAMAN asked, WHAT IS THE REACTION OF SALARIED PERONS?
Mudit Jain answers, Dismal Very small relief of increase in taxable income.
Parag CA asked, The budget seems to target votes of Middle Class -salaried people.FM must not forget the Indian dream of Economic Power house!
Mudit Jain answers, Budget seems to target only small farmers and not salaried people or business men.
Manish asked, what will be budget impact on IT (computer Hardware & Parts), Computer RAM, Mobile Memory Cards
Mudit Jain answers, NO impact.
vivek asked, in real terms, how much difference will the new tax slab make?
Mudit Jain answers, Saving of Rs.4,000/- in the lowest bracket in nominal terms. IN real terms could be negative due to high inflation.
Sanjay asked, Sir, is there any announcement on investment and tax excemption? For if the pay commision report comes up then it will be important.
Mudit Jain answers, No exemptions. Pay commission if implemented will increase taxes.
SITARAMAN asked, WHAT WILL BE BUDGET IMPACT ON FOUNDRIES WHICH ARE IN BAD STATE NOW?
Mudit Jain answers, No impact.
SITARAMAN asked, WHAT IS THE REACTION OF SLARIED PERONS?
Mudit Jain answers, Unhappy.
zzxx asked, effect of budget on banking shares
Mudit Jain answers, Will be negative if government does not reimburse banks for waiver of farm loans.
PChidambaram asked, Hi whose Money PChidambaram is donating to Farmers?
Mudit Jain answers, PSU Bank's money and indirectly tax payers money.
Hrushi asked, What will be impact of budget on service sector?
Mudit Jain answers, no impact.
MuditJain asked, cars share will gain,commodities will go down
Mudit Jain answers, Car companies will gain
dilip asked, any import dyty changed in non copper,zinc
Mudit Jain answers, No change.
zzxx asked, how todays budget will effect sensex
Mudit Jain answers, Sensex will come down has no stimulas provided for economy and increase in short term capital gains tax.
kk1 asked, With the reduction in excise duty on small cars, How much will cars like i10 and Swift will be cheaper?
Mudit Jain answers, Approximately Rs.20,000 if benefit is passed on to consumer.
dilip asked, what about cenvat on non ferrous metals and it will be imposed
Mudit Jain answers, Cenvat reduced to 14% from 16%.
MaheshLN asked, Hello There,Can you kindly tell me what will be impact for Home Buyers(Consumers, Builders,Banks and Cement Industry.
Mudit Jain answers, No impact.
m asked, what will be the effect of service tax in mutual funds?
Mudit Jain answers, On asset management companies, service tax imposed. Negative impact.
aafat asked, Do u think it is actually gonnaa effect the salaried class that much?
Mudit Jain answers, Salaried class always affected.
ujjwal asked, Hello,what do you think about today's budget
Mudit Jain answers, The intelligent FM lost an opportunity to go down in history as a reformer.
Apurba asked, How the budget is going to affect Rupee appreciation? Will the rupee become stronger against dollar?
Mudit Jain answers, The rupee may become weaker due to negative impact on stock exchange.
MINTU asked, CIGARETTES RATE INCREASED WHIC CIGARETTES HOW MUCH
Mudit Jain answers, All cigarettes will be taxed equally. Increase in non filter cigaret tax not quantified in budget.
kartik asked, Any revision in TDS rate for professionals or technical services?
Mudit Jain answers, None
d asked, is there any impact on the dollar vaule?
Mudit Jain answers, Rupee likely to depreciate.
d asked, is there any impact on the dollar vaule?
Mudit Jain answers, Rupee likely to depreciate.
vamis asked, What will be the impact on oil sector and indian pharma sector stocks
Mudit Jain answers, No impact on oil sector and positive for pharma sector.
nikita asked, there is duty cut on life saving drugs? what all comes under this?
Mudit Jain answers, Yes, for aids, vaccines and other life saving drugs.
Suri asked, Hello Sir, Can u tell me whether the tax holiday for software industry under 100% EOU extended beyond FY 08-09.
Mudit Jain answers, No
NADU asked, What about the ppf ,nsc,kvp interest rate???
Mudit Jain answers, No increase in rates but greater amount for IT deductions.
sankesh asked, is there any package for sugar industries
Mudit Jain answers, No
mhnmishra asked, is this buduget gives relax to common man.
Mudit Jain answers, No
madhu asked, What will be the impact of budget on home loans & other loans ??? Are the interests lowered or will lower in near future ???
Mudit Jain answers, No mention in budget.
Abhijit asked, What is the impact of power supply in this budget 2008
Mudit Jain answers, No impact.
jerky asked, Why the manufacturing sector receives a step brotherly treatment? Shoudnt the FM given more consessions on Excise?
Mudit Jain answers, Because it is not politically correct. Sound economics should be sound politics and input cost in manufacturing should be reduced. More concessions on excise should be given and excise rates should be maximum 6%.
Suraj asked, service tax exemption limit. what will be the budget impact on various industries, tax subcidy, professional tax, central excise duty
Mudit Jain answers, Service tax limit raised to Rs.10 lakhs and excise duty reduced to 14%.
arindam asked, Hi... is it a populist budget with no heed to corporates ????
Mudit Jain answers, It is a poor farmers budget only. Hope they get the benefit.
harishkumar.hp asked, My Salary is approx 8.5 La per annum, is the budget good? what could my savings?
Mudit Jain answers, Approximately Rs.40,000/- p.a.
pushkar asked, why wwill salaried person be unhappy ?
Mudit Jain answers, Increase in exemption limit is nominal and cost of living increase is much higher.
arindam asked, Hi... is it a populist budget with no heed to corporates ????
Mudit Jain answers, Not populist and also not helpful for corporates and economic growth.
Nikhil asked, Who gives the authority to government to pay taxpayers money to only a small segment of society without any second thought (I mean farmers and minorities)
Mudit Jain answers, Our imperfect democractic system.
chetan asked, Sir i want to ask waht the fianancial minister doing for students
Mudit Jain answers, Nothing.
srini asked, Has the STPI tax holiday extended?
Mudit Jain answers, No
nikita asked, Any increase in the section 80C limit of 1 lakh?
Mudit Jain answers, No
jai asked, how do u rate this budget on a scale of 1-5
Mudit Jain answers, One being the lowest score
Raghunath asked, What is the status of STPI ITES units tax holiday? Whether it is extended beyond March 2009 or not?
Mudit Jain answers, Status remains unchanged.
ravikumar asked, is the share market being volatile because of budget
Mudit Jain answers, Certainly.
garg85_naveen@rediffmail.com asked, DID THIS BUDGET NOT PREPARED TO FULL FILL VOTE BANK BY GIVING BENEFIT TO THOSE PEOPLE WHOSE NUMBERS ARE MORE?
Mudit Jain answers, Yes. Vote bank politics for small farmers.
rajaa asked, how do u rate this budget? how much you will give out of 100?
Mudit Jain answers, Fail marks. Historic opportunity lost once again to improve India.
pushkar asked, will there be any income tax rebate in year 2007-2008? will be 150k cutoff will be applicable this year ? i am so worried
Mudit Jain answers, Applicable from financial year 2008-2009. Worry will not solve your problem.
Macmohansingh asked, Any tax impact for NRIs
Mudit Jain answers, Nothing.
mintesh asked, wht. abt sales tax / cst 3% ????
Mudit Jain answers, Reduced to 2%
rahulshah asked, If no new taxes are there, inflation will move up. How budget will be tackling that?
Mudit Jain answers, Budget not tackling inflation. Budget increasing inflation.
riya asked, what will be impact on cng? Also confirm is there any surcharge on refilling cng thru credit card
Mudit Jain answers, No changes this year.
vikram asked, Will the Banking stocks still perform better in long run?
Mudit Jain answers, PSU banks will be impacted negatively. Private banks no impact.
chandrakumar asked, what inflation control measures has been taken
Mudit Jain answers, None. Inflation being increased due to high taxation.
rajaa asked, how do u rate this budjet?
Mudit Jain answers, Very poor.
Satyabrata asked, What is your view on per-capita income in our country?
Mudit Jain answers, Very low less than $ 500 per person due to bad policies.
testing asked, Want to know whether STT has been increased
Mudit Jain answers, Remains unchanged. Commodities included in STT also.
mittun asked, You say budget is favourable only for farmers. But markets have recoverd 400pts to close -209 points. I think even the markets feel the budget is favourable. Your comments.
Mudit Jain answers, REcovery of market is due to speculative trading.
haridoss asked, do u welcome the proposal to waiver of agri loans.
Mudit Jain answers, No relief should be provided by roll over but not waiver.
Indranil asked, Duty withdrawn on naptha for production of polymers pls explain what is the effect about chemical exporter
Mudit Jain answers, Will make basic polymers more expensive to produce and thereby negatively impact exports.
Peeyush asked, Do the normal petrol we use classify as Unbranded Petrol? Would its price go up because of excise duty of 1.35/litre
Mudit Jain answers, No change in price eventhough excise increase but import duty reduced.
VGT asked, what is the investment limit one can show? The last year had it at Rs 1 lakh.
Mudit Jain answers, Rs.1.5 lakhs
harshit asked, what will be the effect on infrastructure funds
Mudit Jain answers, slightly negative due to increase in captial gains tax and service tax introduction.
Apurba asked, How the budget is going to affect Rupee appreciation? Will the rupee become stronger against dollar?
Mudit Jain answers, Rupee will become weaker.
spv asked, any change in excise duty on tools?
Mudit Jain answers, No
raman asked, WILL THE REDUCTION OF 16% SLAB IN EXCISE HAVE A FAVOURABLE IMPACT
Mudit Jain answers, Minor positive impact.
Debashis asked, How the fharma(Medicin)industry is going rto do?
Mudit Jain answers, Maybe as life saving drugs for aids etc. have been made duty free.
Mudit Jain says, Thank you for your questions.
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