My views on Budget 2009
This year I was following the Finance Ministers budget speech. I thought I understood some of it! Many newspapers have hailed the budget as a good one. I may be wrong at this point of time but I think the FM did not deliver as expected. I am just putting to ink my thoughts based on my experience (however limited it may be).
I was hoping for changes in the personal tax slabs and that the limit for home loan benefit would be increased. But he disappointed me. He has also proposed to abolish the Fringe benefit tax. While this is good for companies its bad for the individual tax payer as the onus now rests on the individual.
The FM has increased the allocation to infrastructure projects by almost a fourth. This is excellent but what is very worrying is that the fiscal deficit will be increased in a planned way to 6.8%. This is too dangerous. He has planned to reduce it to 4% in three years. Lets hope he is successful. After so many years I think we cannot trust politicians to keep their words. Just the other day the new Railway Minister Mamta Banerjee has doubted if Lalu Yadav really made those many thousand crore profits for the Railways!
He has proposed to borrow upto Rs.400k crores from the markets to drive up the spending in the infrastructure projects and other schemes, but with so much money being taken out of the banks will there be enough left for the banks to lend to others – private enterprise and persons like you and me? Will this drive up the rate of interest for borrowers? Will inflation go up again? If it does then it will hit us really bad because by that time the rest of the world would be coming out of their own recessions.
To avoid this probably the government will print more currency to part fund the Rs.400k crores. This will also drive up inflation. And this year it looks as though there is going to be a deficit in the rainfall. Its going to be a huge challenge if there is a weak monsoon. It will only add up to our worries.
I was hoping for changes in the personal tax slabs and that the limit for home loan benefit would be increased. But he disappointed me. He has also proposed to abolish the Fringe benefit tax. While this is good for companies its bad for the individual tax payer as the onus now rests on the individual.
The FM has increased the allocation to infrastructure projects by almost a fourth. This is excellent but what is very worrying is that the fiscal deficit will be increased in a planned way to 6.8%. This is too dangerous. He has planned to reduce it to 4% in three years. Lets hope he is successful. After so many years I think we cannot trust politicians to keep their words. Just the other day the new Railway Minister Mamta Banerjee has doubted if Lalu Yadav really made those many thousand crore profits for the Railways!
He has proposed to borrow upto Rs.400k crores from the markets to drive up the spending in the infrastructure projects and other schemes, but with so much money being taken out of the banks will there be enough left for the banks to lend to others – private enterprise and persons like you and me? Will this drive up the rate of interest for borrowers? Will inflation go up again? If it does then it will hit us really bad because by that time the rest of the world would be coming out of their own recessions.
To avoid this probably the government will print more currency to part fund the Rs.400k crores. This will also drive up inflation. And this year it looks as though there is going to be a deficit in the rainfall. Its going to be a huge challenge if there is a weak monsoon. It will only add up to our worries.
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