Get the best of Budget 2015 in the next few hundred words with these budget bites. And for a detailed analysis on how Budget 2015 affects your financial future, schedule a meeting with your financial planner. On that note, here’s to budget bites to help you gain ground.
First things first, Budget 2015 will definitely propel long term economic growth. Economic activity will improve. And so will corporate earnings.
The budget has brought down the corporate tax from 30% to 25%. However the service tax has been increased from 12.36% to 14%. There has been a huge increase in taxes from 2011. This is good for the country and the government.
This budget will ensure that there will be a better collection of taxes.
The Indian economy will be at its strongest since 2007. And the grounds are being set for this to get better. The government thrust is on infrastructure spending and rejuvenative India.
Capex is on Roads, Railways and many other areas of capital equipment. For Eg: Central govt PSU will do capex of 3 lac crores in the coming years.
The govt has managed to increase taxes significantly and use it for capex. This is good for the next 3-5 year period.
Bites on the capital markets
India is one of the best markets in the world with a 3 to 5 years view. Reason being that India’s growth will pick up in the next few years.
Strong Demographics. Strong Government. Strong prospects for real growth in 2016-17 and 2017-18.
Basic engines like Infrastructure, Roads, Railways, Power will help India recover and move forward.
The budget put the economy on a higher and sustainable growth path, desists from populism, aims to improve business conditions, improve government’s functioning and improve delivery of services to citizens while maintaining fiscal discipline.
The budget reinforces our view of improving economic conditions in India and we maintain a positive outlook of equity and fixed income markets.
All the above will help the capital markets to see a gradual uptrend over the next few years.
Bites on the Personal Finance
You can claim upto Rs.25,000 towards Health Insurance Premium; it was earlier only Rs.15,000 which will increase tax saving by odd Rs.3000/-
Additional tax deduction is allowed for rs.50000/- investment in National Pension Scheme(NPS) under sec80CCD. NPS doesn’t have track record of performance,
Equity Large cap funds has always outperformed NPS so we don’t recommend investing in NPS. Another reason being at the time of exit from NPS, compulsory option is annuity, which is taxable.
Gold Monetisation Scheme is launched to increase the share of financial asset. It looks like you have to deposit the gold for a certain period to get fixed interest income and maturity proceeds will be paid back to your account. How this scheme will be beneficial can be analyzed depending on the rate of return offered. Details are awaited.
Finally, there are no changes in the income tax slabs. That said, your financial planner can still show you a way to keep gaining ground in 2015. Happy budgeting and financial planning!