Budget welcomed

■ Continued from Page 1 With the finance minister’s announcements, India Inc welcomed the Budget, while at the same time economists and opposition were muted in their reactions. On the other hand, the benchmark S&P BSE Sensex stocks index extended its decline to as much as 1.9 per cent on Saturday.

Nosediving nearly 1,275 points from the day’s high, the 30-share BSE Sensex ended 987.96 points, after the Union Budget failed to live up to market expectations of growth-boosting measures and fiscal discipline. Besides, investors’ wealth of about `3.46 lakh crore has been wiped off from the system as well.

As far as personal tax cut of individuals is concerned, Ms Sitharaman wanted more money should come in individual’s hand, and thereby slashed the income tax, which would help save about `31,000 a year in tax for persons with annual income of up to `17 lakh.

It was, however, conditioned on current exemptions and deductions including standard deduction for `50,000 as well as the waiver earned on payment of up to `1.5 lakh in tuition fee of children, and contribution towards insurance premium and provident fund, being given up.

However, the finance minister also clarified that the new tax regime would be optional for taxpayers. Under the proposed I-T slab, annual income up to `2.5 lakh is exempt from tax. Those individuals earning between `2.5 lakh and `5 lakh will pay 5 per cent tax. A 10 per cent tax will be charged on income between `5 and 7.5 lakh, 15 per cent, 20 per cent and 25 per cent on next `2.5 lakh each and 30 per cent on income above `15 lakh.

Alongside, the limit of insurance cover in case of bank failure on deposits was increased to `5 lakh from `1 lakh and a sale of government stake in the country’s largest insurer LIC also announced as well.

For farm and rural sectors, she also allocated `2.83 lakh crore and fixed `15 lakh crore target for financing agriculture credit. Another `1.7 lakh crore spending was planned for transport infrastructure and `40,740 crore allocation was made for the energy sector.

Ms Sitharaman proposed new tax slabs of 15 per cent and 25 per cent in addition to the existing 10 per cent, 20 per cent and 30 per cent.