Budget 2012: Is DTC a bane or boon for the working class?

In the foreseeable future one can expect petrol and diesel price revision before the budget. In the budget excise duties may go up on automobiles and other products including consumer durables leading to the burden being passed onto the consumer.

Also Read: Budget Expectations: Wishlist of the common man

Salaried class may look forward to changes in three areas-

a) Change of the minimum exemption for income tax from Rs 1 lakh 80 thousand to near about Rs 3 lakh. This is something that will add to the disposable income of the salaried individual.

b) Other than the tax exemption limit change, one can look forward to higher rebates on investment into infrastructure bonds which currently enjoy a rebate up to an investment of Rs 20,000. The same may be increased to Rs 50,000.

c) The third area change which can be favorable to a salaried individual coupled with leading to a boost to the housing sector is the increase in exemption of interest paid on loans borrowed for buying houses for self occupation which is currently restricted to Rs 1 lakh 50 thousand for the year. This limit enhanced to Rs 3 lakh could bring additional relief to a salaried individual who has borrowed and invested in a residential house for self occupation.

d) Equity Linked Savings Scheme as an investment class might not qualify for tax saving. Also, expectations are that the allowances exempted from tax are increased along with rise in exemption limits under Sections 80 C and others from the present Rs 1 lakh to atleast Rs 1.5 lakh.