Jaswant is Santa after Christmas, before polls

Pre-empting criticism of a virtual mini-budget ahead of polls, Finance Minister Jaswant Singh said the announcements were made keeping an eye on the growth prospects of the country. Talking to newspersons outside his North Block office, Singh said: ‘‘The Indian economy is in a situation where it requires timely policy and economic measures to give an impetus to growth. There is nothing sacrosanct about announcing such measures only in the Budget and going off to sleep for the rest of the year.’’

The best news for India Inc is that it would not have to wait until April for these savings as in the case of a normal Budget. The concessions will be applicable from tomorrow.

Though a slew of consumer items will be cheaper, the air traveller will be the happiest. Not only has Singh abolished the 15 per cent Inland Air Travel Tax (IATT) making air fares cheaper by 15 per cent starting tomorrow morning, he has also helped airlines by cutting excise duty of Aviation Turbine Fuel (ATF) by half. This advantage could also be passed on to customers.

Also, the Government exempted salaried class with up to Rs 1.5 lakh income from filing tax returns. Senior citizens who have been on the receiving end with falling interest rates have been given a psychological boost by being exempt from the purview of the one-by-six scheme.

The Centre bestowed a one-time income tax exemption for the infrastructure projects, while it sought to create hassle-free regime for the salaried class and professionals like doctors and accountants by going in for paperless filing of returns and cutting the number of challan forms for payment of TDS to one from the present four. Electronic filing of service tax returns has been extended to all 58 taxable services from the present 10. This could be the first package announced by the Government but insiders say that several other announcements for the farm sector, urban development and pensioners could be on the way.

The Finance Minister hasn’t completely ignored the farm sector: he has given duty concessions to water-supply projects. The duty cuts on power distribution and transmission projects could also mean cheaper power for farmers in the medium term.

While there was no official confirmation about the impact of these measures on the Central kitty, conservative estimates by experts put the cost to the exchequer at anything between Rs 8,000 and Rs 10,000 crore.

In a bid to boost investments, the Government has cut customs duty on project imports with investment of at least Rs 5 crore in plant and machinery from 25 per cent to 10 per cent. Customs duty on coal is down to 15 per cent from 25 per cent and on nickel and other articles from 10 to 5 per cent.

The Government also cut down duty by 5 per cent on specified life-saving bulk drugs, formulations, medical equipment and artifical limbs. The customs duty has been cut by 15 per cent to 10 on power transmission and distribution projects.

To give a boost to emerging IT and electronics sector, the Government has brought down customs duty to 0-5 per cent on specified raw materials and inputs for manufacturing electronic components and optic fibres. It also exempted from customs duty specified capital goods used for manufacture of electronic goods, which now attract 10-15 per cent duty. Recorded video compact discs and digital video discs have also been exempted from excise duty.