Budget 2010 Highlights | Budget India | Impact on Stock market

The market had very few expectations from the budget and thus the budget has been able to more or less able to please the trading community and thus one can say that budget 2010 India date has been met successfully by our finance minister Pranab Mukherjee. Hoteliers have also a reason to cheer as building and operating a new hotel of two-star or above category, anywhere in India, which starts functioning after 1.4.2010 has been considered within the purview of “specified business”. The same has been granted considering the fact that hotel industry can provide high employment potential and thus investment linked incentive to the hotel sector, irrespective of location, under section 35AD of the Income-tax Act has been provided. It means that it will  allow 100 per cent deduction in respect of the whole of any expenditure of capital nature (other than on land, goodwill and financial instrument) incurred wholly and exclusively, for the purposes of the “specified business” during the previous year in which such expenditure is incurred.
Click Here to Get Free Financial News Impact in Email to Make Money in Share Market
Indian budget 2010 highlights suggest that the same is positve for pharma sector and stocks likely to be benefitted are Ranbaxy, Sun pharma, Biocon and Divis lab. Similarily Suzlon is going to get benefitted by virtue of reduction in excise duty exemption for wind turbines. Similarily power sector is going to see an increased allocation to the tune of Rs 5130 Crores and thus Powergrid and NTPC will benefit the most from the same. Agriculture loan waiver which has been extended till 30 June 2010; is going to benefit the State bank of India. We are going to see increase in number of banking licenses from RBI which is going to benefit IDFC, IFCI and Reliance Capital. Last but not least IDBI bank is going to get benefitted by virtue of increase in banking licenses by Reserve Bank of India.

Budget 2010 income tax proposals brought a lot of cheers for people earning between Rs 3 Lakh-8 Lakh and people earning up to Rs 8 Lakh per annum have been the most benefited by budget granting a waiver of income tax to the tune of Rs 50,000. However those drawing less than Rs 3 Lakh have not been given any fresh budget break except for additional infrastructure bond investments.  If you earn up to Rs 3 lakhs per annum, then there will be no change in your tax liability. If you earn between Rs 3 lakhs to Rs 5 lakhs, you can now save up to Rs 20,000 per annum. And, if you earn between Rs 5 lakhs to Rs 8 lakhs, you can now save between Rs 20,000 to Rs 50,000.  The investment savvy guys and gals have another reason to cheer as due to thrust on infrastructure now it has been proposed to insert a new section 80CCF in the Income-tax Act to provide that subscription during the financial year 2010-11 made to long-term infrastructure bonds (as may be notified by the Central Government), to the extent of Rs. 20,000, shall be allowed as deduction in computing the income of an individual or a Hindu undivided family. This deduction will be over and above the existing overall limit of tax deduction on savings of upto Rs.1 lakh under section 80C, 80CCC and 80CCD of the Act. Thus one can claim deduction to the tune of Rs 1 Lakh and twenty thousand and same is good for Indians as they have the habit of saving. This amendment is proposed to take effect from 1st April, 2011 and will, accordingly, apply in relation to the assessment year 2011-12.

For Men Tax Slabs
Up to Rs 1,60,000 - Nil
From Rs 1,60,001 to Rs 5,00,000 - 10%
From Rs 5,00,001 to Rs 8,00,000 - 20%
Above Rs 8,00,001 - 30%

For Women Tax Slabs
Up to Rs 1,90,000 - Nil
From Rs 1,90,001 to Rs 5,00,000 - 10%
From Rs 5,00,001 to Rs 8,00,000 - 20%
Above Rs 8,00,001 - 30%
Click Here to Get Free Indian Stock Market Tips in Email
It was a surprise budget income tax waiver for the salaried class as VI pay commission has given enough in the hands of the service class but same was being eaten by income tax. Moreover effort has been done now to even rein the fiscal deficit which is good for the industry and same has sent positive signals to the world community. Overall the budget gets a thumbs up as it has delivered more than the expectations i.e. Jaruruat Se Jyada. Thanx Finance Minister for doing a wonderful job.