Find out all about the budget and how it affects your pocket, that too, minus the jargon. Get tips from experts on what you can do now. Also meet people like you and find out what they think about the budget. First we spoke to Blessen Varghese and then to Ritu Khanna.

Name: Blessen Varghese

Age: 23

Industry: Information Technology

Profile: Technical writer/ Instructional designer

Income: Rs 228,949 per annum (gross)

Tax deducted at source: Rs 22,620 per annum

Investments: LIC premium of Rs 11,232 half-yearly

Debts: Nil

What happened in the budget for him?

The measure: Tax slabs have changed for the better. Here are the new tax slabs for men:

Slab	Tax rate
0 to Rs 1.5 lakh	0%
Rs 1.5 lakh to Rs 3 lakh	10%
Rs 3 lakh to Rs 5 lakh	20%
Above Rs 5 lakh	30%

However, surcharge and education cess remain the same.

The impact:

Taxable income (Rs)	Tax before budget (Rs)	Tax after budget (Rs)	More money in the pocket (Rs)
200,000	14,420	5,150	9,270
500,000	101,970	56,650	45,320
1,000,000	256,470	211,150	45,320
1,200,000	350,097	300,245	49,852
1,500,000	452,067	402,215	49,852
2,000,000	622,017	572,165	49,852
2,500,000	791,967	742,115	49,852
4,000,000	1,301,817	1,251,965	49,852

The measure: Postal time deposits schemes included under section 80C

The impact: Blessen can now invest in postal time deposit schemes and get a tax deduction of up to Rs 1 lakh.

The measure: Excise duties reduced on two wheelers, small and hybrid cars. But duties on non filter cigarettes and cellular mobile phones will go up.

The impact: If Blessen was planning to buy a vehicle, they will now come cheaper. If he is a smoker, he will now pay more on non filter cigarettes. Also, he will pay more for cellular mobile phones.

What is his reaction?

“I am very happy about the increase in tax exemption from Rs 110,000 to Rs 150,000. I have been thinking of buying a car for a while. Now that the excise duty for small cars has decreased to 12% (from 16%), I think I will finally own a car. But I am certainly not happy about the increase of cigarette prices.”

What should he do now to plan his money better?

-          Since Blessen’s tax outgo will decrease, he will have more money on hand to save and spend. He must choose his investments wisely and save smartly. Expert, HP Ranina says, “The budget is a good move for common tax payers. They can make substantial saving following the enhancement of the threshold.”

-          Although he can invest in postal term deposits to get a deduction, he must consider instruments like equity linked savings schemes, the returns of which are more tax efficient. ELSS is also good from a long-term wealth creation point of view. Alternately, he can look at public provident fund schemes that give tax-free interest.

Go to page 2 to read Ritu's profile

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