The Hindu : New Delhi News : Budget disappoints salaried taxpayers

Online edition of India's National Newspaper
Friday, Jul 09, 2004

New Delhi

New Delhi

Budget disappoints salaried taxpayers

By Our Staff Reporter

NEW DELHI, JULY 8. The Union Finance Minister, P. Chidambaram's announcements in his maiden Budget today raising the income tax exemption limit to Rs.1 lakh and launching a new savings scheme with a higher rate of interest for senior citizens have left these two sections of society happy. However, a vast number of salaried taxpayers belonging to the middle class are sorely disappointed that no income tax relief at all has been extended to them and on top of that, to add to their burden, a two per cent education cess has been imposed on them. To make things even worse for them, they complained, the service tax now has shot up to 10 per cent.

The only relief for the salaried class has been that the interest rates on small savings schemes including PPF and GPF have remained unchanged. Students and youth are happy that they will be able to get cheaper educational loans.

"I was hoping to get some long overdue relief in my income tax. Instead I will have to pay more in the form of education cess. The Government should have uniformly extended the tax limit to benefit all taxpayers. By finding out alternate ways to increase the tax net, it could have easily covered the deficit incurred from increasing the income tax limit. I am disappointed, but I hope that in his next Budget Mr. Chidambaram will do something on this front as promised in his Budget speech," said Om Prakash, a government employee. He, however, welcomed the steps taken to strengthen the nation's economy, industry and infrastructure.

A great many people expressed their displeasure over the increases in service tax, excise and customs duties. "The Government's commitment towards the poor and underprivileged sections is very clear from this Budget. But I hope that it will be able to make some positive change in the nation's social and economic development," said Bharti Rathore, a doctor by profession.

The young generation has at least three points to draw some cheer from the Budget - affordable and easy education loans, cheaper computers and a boost to the already upbeat telecom sector. "These three things are key to today's youth. Now we can look forward to an easy access to higher education in India as well as abroad. India is the world leader in the field of information technology, and now cheaper computers and opening of the telecom sector for foreign investment will not only result in yet another IT revolution in the country, with towns and rural India also being covered by it, but also open up more job opportunities in the two sectors which are important for India's growth," asserted Rohit Bhandari, who has just been employed in the telecom sector.

For Hari Prakash, a retired government employee who plans to shift to his ancestral village in Uttar Pradesh to look after his farms there, the Budget has brought at least two good tidings. "By announcing the Senior Citizens Savings Scheme and promising to continue with high-yielding government bonds, the UPA Government has done a lot for senior citizens who were until now very worried by the falling bank interest rates. We can now hope for some good return from our hard-earned money. And for me, various sops for the farm sector and rural India will also help me and the entire farming community a lot," he added.

People have also expressed happiness over special packages for Bihar, Jammu and Kashmir, and the North-Eastern States. "The government has shown a lot of maturity by announcing financial packages for backward States. This will not only check migration of natives of these States but will also bring them closure to the national mainstream. Similarly, the welfare schemes announced for widows and children of defence personnel killed in operations are a welcome move," said Devika Pathak, a fashion designer, who at the same time expressed her unhappiness that the Finance Minister had neglected women in his Budget. She also questioned the logic behind "massive increase" in the defence outlay when several other sectors of the economy as well as the social mainstream suffer due to lack of funds.

Printer friendly page
Send this article to Friends by E-Mail

New Delhi