21st Feb, 2010

The following is the view of market experts and finance gurus of what they  are expecting from the Union Budget 2010 to be presneted by Mr Pranab Mukharjee on the 26th of this month.

Auto

* Increase in excise duty by 2%-4%.

* Increased allocation under National Urban Renewal Mission for buses

* No increase in excise duties for large cars

Banking and financial services

* Interest subventions for pre-shipment credit and short-term crop loans expected to be withdrawn.

* To qualify for tax benefits under Sec.80C on Fixed deposits  lock in period to be reduced from five to three years.

* Raising the ceiling of TDS on interest income from fixed deposits.

* Allowing banks to raise tax-free infrastructure funds.

* Tax breaks to housing finance and infrastructure-lending companies.

* Housing loans below 30 Lakh rupees to be considered as "priority sector" lending.

* Refinancing from India Infrastructure Finance Co Ltd (IIFCL) for up to 60% of commercial bank loans for PPP (public private partnership) projects in critical sectors is expected to continue.

* Increase FDI in insurance sector from 26% to 49%.

* Recapitalisation of PSU banks with lower tier-1 capital.

Cement

* Roll back of excise duty cuts of around 2%-4%.

• Reduction in import duty on coal

Construction

* An increased outlay in government spending in infrastructure, especially for roads and urban projects

* Details of refinancing for India Infrastructure Finance Company Ltd (IIFCL) funding

* Clarity on minimum alternate tax provisions under a new Direct Tax code, to be implemented in FY12

* More financial availability for infrastructure projects

* National project status for state government projects

Engineering and capital goods

* Increase in import duty on foreign power equipments like turbines, boilers and generators.

* Rollback of excise duty concession given in the stimulus package to manufacturers by minimum 2%.

FMCG

* Raise excise duty on cigarettes by 5%-8%

* Excise duty cuts on products except food items may be reversed by 2-3%

* Rural initiatives for income generation are expected to continue

* MAT (Minimum Alternative Tax) rates can be increased, as a step forward towards the Direct tax Code.

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Real estate

* Hotels to be included under Sec 80 IA (Infrastructure status) for all hotels across India and across all categories

* Greater thrust on PPP projects in housing.

* Increase in allotment to the Rajiv Gandhi Awas Yojana (slum rehabilitation programme)

* Increasing tax breaks provided to housing finance and infrastructure lending companies.

* Re-introduction of tax holiday for housing projects under Sec 80 IB (10)

* Increase in income tax deduction under Sec 80 C on home loan principal re-payment from Rs 0.1 million to Rs 0.2-0.3 million.

Information technology

* Extension of tax benefits for units in Software Technolog