Buget Expectations By Different Newspapers

* The federal government may relax overseas borrowing norms
to make infrastructure projects more attractive to private
developers.
* Social welfare programmes may see only a modest increase in
outlay.
* The finance ministry is likely to exempt shipping companies
from minimum alternate tax on profits earned from sale of
vessels. Shipping firms may also get waiver on tax payable on
interest income from tonnage tax reserves.
* The finance minister may announce a
modernisation-cum-upgrade fund for auto components.
* The railway minister is likely to reduce both passenger
fares and freight rates.

* Companies exploring oil and gas in the country are likely
to be exempted from paying service tax of 12 percent.
* The automobile industry wants government to cut excise duty
on big cars.
* The rail ministry is expected to announce the second phase
of the Mumbai Urban Transport Project at an estimated outlay of
45.10 billion rupees.
* The government is likely to announce the commencement of
the construction of the eastern corridor in the Railway Budget.
* The government may cut duties on crude oil and petroleum
products to counter high global oil prices.
* The government is likely to extend income-tax incentives to
100 percent export-oriented units for one more year beyond March
2009.
* Income generated from agricultural advances by state
co-operative banks and district central co-operative banks is
likely to be exempted from tax from 2008/09.
* The agriculture ministry has proposed a cess of 1 percent
on direct taxes and 2 percent on indirect taxes to part-fund a
debt relief package for farmers.
* The government may extend 10-year tax exemption under the
Software Technology Parks of India (STPI) scheme, provided to
units located in STPIs.The scheme ends in March 2009.
* The federal budget may propose that Limited Liability
Partnerships (LLPs) be allowed to choose how they are taxed,
depending on their structure. A LLP is essentially a partnership
where the legal status of the LLP is separate from its partners.
* The Dividend Distribution Tax (DDT) rate may be cut from 15
percent to 12.5 percent.
* The government is set to increase the corpus of the Rural
Infrastructure Development Fund by 20 billion rupees to 140
billion in the forthcoming Budget. The corpus of the fund was
increased to 120 billion rupees from 100 billion rupees in the
last budget.
* The Rail ministry is likely to announce a slew of freight
incentives, aimed at producers of bulk commodities, such as
allowing customers to construct 'bulk terminals' which would
allow storage and transportation of a specific commodity.
* The government is considering a proposal to grant the
'declared goods' status to natural gas and biofuels, making these
petroleum products eligible for a lower and uniform sales tax
across the country.
* The government is considering extending tax exemption for
companies setting up ultra mega power projects by seven year. The
exemption, which under current rules will end in 2010, may be
extended to 2017.
* Oil firms engaged in the exploration and production work
are likely to be exempted from the 12 percent service tax.
* The finance ministry is neither planning a hike nor a
reduction in excise duty, which is currently levied at 16 percent.
* Leather, textile, marine and handicrafts sectors are likely
to get an extension of the 2 percent subvention in export credit
for another year.
* Information Technology ministry seeks duty cuts on
electronic and IT goods used by the hardware and software
industry. A reduction of excise duty from 16 percent to 12
percent likely to be announced.
* Service Tax rate likely to be unchanged; currently the
service tax rate is 12 percent.
* The government may revise the method of calculation of
excise duty on cement, resulting in lower payouts, and waive
import duty on coal and pet coke; key inputs in the making of
cement.
* The corporate tax rate, which stands at 33.9 percent,
including surcharge and cess, may be lowered by abolishing the
surcharge. The government may also reduce the number of
exemptions, which help companies reduce their tax burden.
* The bar for consumption loans for farmers may be raised by
more than 50,000 rupees, on a backdrop a wave of suicides in the
farming community that has rattled the government.
* Value-added tax for LPG and other declared goods, edible
oils, bread, ready-made garments and intermediate goods may be
raised to 5 percent from the present 4 percent, to offset revenue
loss the states incur due to lower central sales tax.
* Taxi, bus fleet owners and contractors providing raw
materials, electrical work and furniture in civil constructions
are likely to come under the presumptive income tax net.
* Corporates may have to pay tax on capital income arising
from money forfeited as part-payment for their shares.
* The government is considering waiving securities
transactions tax (STT) on unexercised options in the derivatives
market.
* The Goods and Services Tax (GST) rate and structure may be
announced. The Central Sales Tax (CST) rate may be cut by 1
percent to 2 percent and completely withdrawn by 2010-2011 once
the GST is in the final implementation phase.
* The government may increase the notified area under the
local urban development authority from the present 8 kilometres,
allowing it to impose capital gains tax on sale of agriculture
land, that has not been used for more than two years for farming.
* The government may raise the limit for Viability Gap
Funding (VGF) to 30 percent from 20 percent for urban transport
systems like metro, monorail and road rapid transport system.
VGF is a one-time grant by the government to an
infrastructure project with a long gestation period to improve
its viability.
* Interest or dividend earned on infrastructure bonds issued
by commercial banks may be exempted from tax.
* The existing 10 percent surcharge on personal and corporate
income tax may be halved or scrapped, reducing the burden of a
certain category of individuals, firms and companies between 1.54
to 3.09 percent.
* The Tirupur Exporters Association in a pre-budget
memorandum to the finance ministry has sought to raise the
depreciation on plant and machinery to 25 percent and wants
service tax and fringe benefit tax on sales promotion expenses to
be removed.
* The government may announce a new fund for providing
subsidised loans to companies for adoption of energy-efficient
and non-oil technologies, according to a survey by Federation of
India Chambers of Commerce and Industry.
* Oil companies seek review on the customs and excise duty
structure on oil and oil products.
* A pension scheme for widows, disabled and old people below
the poverty line. The government is also planning to reduce the
minimum age for beneficiaries of pension living below the poverty
line to 60 years from 65.
* The government may remove regulatory restrictions on
payments received by foreign companies from their Indian
partners, joint ventures and subsidiaries for providing funds and
technical assistance.
* The finance ministry may revive tax benefits for real
estate developers for constructing houses for the economically
weaker sections.
* About a dozen new services such as legal draft writing and
stamp paper vending, all unaided non-government schools, colleges
and hospitals and recreation and amusement parks, may be brought
under the service tax net.
* Interest earned on external commercial borrowings may be
taxed, making foreign debt more expensive and help moderate the
surplus on the capital account - expected to touch $103 billion
this fiscal.
* Duties on life-saving medicines used in the treatment of
cancer, AIDS and diabetes may be exempted.
* The federal civil aviation minister has demanded
rationalisation of aviation tax structure, a cut in sales tax on
aviation turbine fuel and scrapping of service tax on business
and first-class tickets for Indian international carriers.
* The standard tax deduction limit for individual tax payers
may be raised 20 percent to 120,000 rupees, allowing a taxpayer
to save up to 2,000 rupees in taxes every year.
* Indirect taxes on consumer goods may be moderated to boost
consumption.
* Imported set top boxes may attract a customs duty of 5
percent, in a move to encourage domestic goods.
* Public sector banks may be exempt from fringe benefit tax
on their contribution to statutory pension funds.
* Duties on consumer electronics goods may be cut to 12
percent from 16 percent.
* Pass-through status for venture capital funds investing in
food processing industry and infrastructure facilities such as
warehouses may be restored. The status allows tax exemption for
earnings of VC funds.
* Personal income tax exemption limit is likely to be raised
to 1.25 lakh rupees a year from 1.1 lakh rupees. Taxable income
of up to 1.5 lakh rupees may continue to attract 10 percent
income tax.
* The government is considering a proposal to waive taxes on
the provisioning of non-performing (NPA) assets by banks,
especially on farm sector lending. NPA provisioning is taxed at
the rate of 30 percent now.
* The 5 percent customs duty for liquefied natural gas used as fuel in power generation projects is likely to be withdrawn.