Wednesday, March 01, 2006

 

Budget blurb

As I read through FM’s budget speech, I found the concluding words of his speech, powerful and commendable -

The young people of India are building castles, it may appear that those castles are in the air, but as Henry David Thoreau said: "If you have built castles in the air, your work need not be lost; that is where they should be. Now put the foundations under them." It is our duty to put the foundations on which the young can build their castles.

Every year, on the last day of February, we have a standard procedure of the Finance Minister walking into the Parliament with a briefcase in hand, ready to present the Union Budget. The following week is loaded with media reports, debating the effectiveness of the budget. Then, we hear septuagenarians talking about the proposed hike in interest rates and then, a week later, all about it is forgotten by youngsters like us. Other than those in the Finance profession, many don’t even give the Headlines a closer look.

But, we would probably be more interested if only we knew how a budget affects us in daily life, from the price of fuel to ready-made dosa mix! We don’t necessarily need to be a Finance whiz-kid to understand and appreciate the effects of a budget. A person of average prudence can easily derive benefits out of following certain aspects of it. For example, this year, if you have an idea of buying a car, you could choose to buy a small car, because the excise duty on the same is reduced. Similarly, instead of buying packaged software over the counter, it could be downloaded from the net, so that you could save 8% excise duty levied on packaged software. These are trivial examples to highlight the importance of understanding a budget. Wider benefits could be drawn out of analysis, which of course, comes with practice. For example, on the higher end, investing in fixed deposits could prove beneficial because it is being qualified for tax exemption. Similarly, there was a time when Indians signed up for insurance policies only to please a relative who is an insurance agent. But, if you survey the budget, you could come up with a gainful mix of insurance products, mutual funds and investments to reduce your tax base considerably.

So the next time, when you flip through the front pages of newspaper, sipping the morning coffee, thinking it is yet another budget, take a second look to see what’s in it for you. With two finance geniuses - Dr.Manmohan Singh and Mr. P.Chidambaram at the helm, it is not surprising that we all have something to rejoice about the budget, except if you are a smoker! Well, alternatively, you might still find a reason to rejoice. The excise duty on cigarettes has gone up by just 5% this year instead of the 10% last year.

Disclaimer:- This post is not intended to display political affiliation:)

Comments:
Actually, this time, there was much less hype and hoopla and more of a "business-as-usual' atmosphere. Which is how it should be.
 
agree with raj. that the tax planning can continue for another year is a good sign. i only hope that the middle class salaried junta get the attention next time arnd by providing more tax saving means.

btw, that closing passage is just brilliant. it can only come from an excellently educated gentleman that mr P C is.
 
I agree with rubic-cube's comment on PC's comment. So it wasn't Main Hoon na this time. Good for him!:-)
AK, I dig your posts. Keep them going!
 
Raj/rubic/deepa, yes...it was a less hyped, nevertheless, an efficient budget. PC's concluding note, an icing on the cake.
thnks deepa!:)
 
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