Bimal Jain Contents Highlights 1. Economic Highlights Overall Impact - Income Tax 6. Budget – 2008 Service Tax 4. Overall Impact - Indirect Tax 2. Direct Tax - Corporate 7. Direct Tax - Individual 8. Excise Duty Custom 9 Electronic & Electrical goods

Bimal Jain Excise Duty:-  Excise duty rate change from 16% to 14%.  Abatement rate also changed for MRP based products.  NCCD (National Calamity contingent duty) on Cellular GSM  1.03% on MRP  payment through PLA.  Excise duty rate increased for Packaged software from 8% to 12%.  Excise duty rate decreased for small cars & Two Wheelers from 16% to 12%. Sales Tax:-  CST reduced from 3% to 2% w.e.f 1 st April 2008 ( Subject to Notifications).  Brief Roadmap provided for GST by April, Excise Duty/Sales Tax

Bimal Jain  Service Tax rate  No Change  12.36%.  Exemption limit for small service provider increased from Rs Lacs. (Registration required if receipts exceeds Rs.9 Lakhs.)  Cenvat Credit on Secondary Freight i.e WH to Customer’s place :- withdrawn.  Any Amt DR/CR w.r.t taxable services with Associated enterprises – payment on accrual basis – U/S 67.  Service tax rate increased for WCT contracts  from 2% to 4%.  Scope of Service Tax extended to:-  Right to use goods  Tangible Goods  No Transfer of Possession & Effective control  Where ever VAT is not applicable.  Assets management Services under ULIP.  Services provided to Stock & Commodity Exchanges.  Customized Software. Service Tax

Bimal Jain  Self adjustments of excess service tax from 50K to 100K Rule 6 (4B)(iii).  Revision in time limits for Revised Return from 60 days to 90 days. Rule 7B.  Resolution Schemes  Disputes up to Rs.25K (as on 1/3/2008) – 1/7/2008 to 30/9/2008  Small Service Provider.  Packing including loading, unloading etc under cargo handling services.  Services in relation to promotion/Marketing of Games of chance.  IT related services Consulting Engineer Services: Consultancy on Computer Hardware/Software. Repairs, Maintenance & Management services for IT software. Business Auxiliary Services: IT related services – software developments, up gradations, right to use of IT software, commercial exploitations. Service Tax

Bimal Jain New Excise Duty rate & abatements for Electronic & Electrical Goods

Bimal Jain Impacts of reduction in Excise Duty before & after Budget on CTV

Bimal Jain Impacts on Excise Duty before & after Budget on GSM Mobile mfg:-

Bimal Jain Impacts of reduction in Excise Duty on RM in – Excise Free Zone (EFZ) ItemsACCTV MRP Dealer’s Price Basic Price Assessable Value Raw Material ED on Raw material Before 16.48% After 14.42% Net reduction in Duty13180

Bimal Jain Impacts of reduction in Excise Duty – Benefits of EFZ VS DTA ItemsACCTV MRP Dealer’s Price Basic Price Assessable Value Raw Material ED on Raw 16.48% (Before Budget) ED on Raw 14.42% (After Budget) ED on 16.48% (Before Budget) ED on 14.42% (After Budget) Impacts on Duty Before Budget After Budget Net Loss in Benefits4215

Bimal Jain Tax to GDP Ratio from 9.5% ( ) to 12.5% ( ) Fiscal Deficit estimated at 3.1% & Revenue Deficit at 1.4%. One time Waiver of Loans to Farmers – Rs.60,000 Cr. GDP forecast  8.7% in Services & Manufacturing sector grow by  10.7% & 9.4% in Inflation projected at 4.4%. Rupee rose by 8.9% in Current Fiscal. Capital inflows will rise by 7.7% in H1 of FY 08 as against 5.1% in FY 07. Govt, RBI to jointly work to check capital inflow. Education, health pillars of social sector reforms. Major Economic Highlights

Bimal Jain Agricultural growth rate at 2.6%. 1 lakh broadband-enabled common service centres in villages. Allow foreign equity in Retail Trade. Meaning of Terms used in Budget :-  Fiscal Deficit:- Revenue Receipts less TTL Expenditure.  Revenue Deficit:- Revenue Receipts Less Revenue Expenditure  GDP:- Gross TTL of Goods & Services. Major Economic Highlights

Bimal Jain  No Change in Corporate Tax  33.99%.  FBT ( Fringed Benefits Tax):-  Continue  Some Changes  Excludes w.e.f 1 st April 2009:-  Guest House Expenses,  Sponsoring Employee for Sports,  Organizing Sports events for employees,  Crèche Expenses,  Non Transferable Electronic Meal Card etc.  Festival celebration expenses ( slab changed from 50% to 20%)  Dividend distribution tax  No Changes  16.99%.  Furnished information to IT deptt of any payment to Non – resident.  Banking cash Transaction Tax withdrawn w.e.f 1 st April 2009  0.1% on Rs.1 Lacs & above withdrawn per day for Company.  Date of filling of Return of Income:- 30th September ( 31st Oct) F.Y Direct Tax - Corporate

Bimal Jain  Thresh hold Exemption limit of Individual Tax increased:- Men :- Rs.1.1 Lacs to 1.5 Lacs Women:-Rs.1.45 Lacs to1.80 Lacs Sr.CitiZenRs.1.95 Lacs to 2.25 Lacs 10% above Rs.10 Lacs & 3% Education & SHE cess –Continue).  Deductions:- 80D for Medi claim Insurance for Parents  Additional Rs.15K.  STCG ( Short Term Capital Gains) rate increased 10% to 15% - Securities. Tax Slabs Direct Tax - Individual

Bimal Jain Direct Tax - Individual

Bimal Jain Direct Tax - Individual

Bimal Jain Budget Highlights :: Customs  No change in peak rate of customs duty, BCD remains 10%, 7.5%, 5% & 0%  EOU,STP,EHTP sale to DTA – Duty abatement reduced from 75%->50%  Convergence products i.e. MP3/ MP4 or MPEG 4 Players with radio/video reception facility – 10%  5% (Without Radio/Video already 5%)  Duty reduced to nil, on some additional items for mfg. of Set Top Box i.e. SMPS, power board, IR module.  NCC duty 1% imposed on Mobile phone. So, total duty on mobile increased from 4% to 5.07%.  Time limit for re-export u/section 74(2) reduced from 36 month to 18 months.  BCD exempted on RM and Components required for mfg. of Connectors, relays, CRT, Part of CRT, Semiconductor, Plasma display panel and Module.  Wireless data cards with PCMCIA/USB/ PCI (G-TRAN) express ports are exempted from excise duty  Excise duty on heat resistant rubber tension tape ( HRRTT) reduced from 16% to 8%

Bimal Jain Thanks