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This article was first published 8 years ago  » Business » How the Budget will make you poorer

How the Budget will make you poorer

February 29, 2016 16:52 IST
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Finance Minister Arun Jaitley has introduced a number of taxes to boost rural welfare programmes. While the Budget proposes to help the poor and the farmers, it has given a raw deal to the salaried class. 

Take a look at how the Budget will dent your savings… 

Income tax remains unchanged

Disappointing millions of taxpayers for the second consecutive year, income tax slabs have remained unchanged.

EPF, NPS will be taxed

On retirement, you will draw a lesser amount as pension. Finance Minister Arun Jailtey has made Employee Provident Fund (EFP) and National Pension Scheme (NPS) withdrawals partially taxable on retirement.

The EPF had no tax on investment, interest accrued or withdrawal. In case of NPS, the entire corpus was taxed on withdrawal.

While 60 per cent of the corpus will attract tax and the remaining 40 per cent will be tax-free, when you withdraw from EPF.

In case of NPS, 60 per cent of the corpus will be taxed and the remaining 40 per cent will need to be put in an annuity fund. 

Even water gets costlier!

While the price of liquor remains unchanged, mineral water, aerated water containing added sugar or sweetening matter will cost more. Cars, cigarettes and branded garments will become more expensive.

Gold and silver jewellery, tobacco products like paper rolled beedis and gutka will be costlier.

Other services that will cost more are air travel, plastic bags and sacks, ropeway, cable car rides, imported imitation jewellery, industrial solar water heater, legal services, lottery tickets, hiring of packers & movers, e-reading devices, instruments for VoIP (Voice over Internet Protocol) and imported golf cars. 

Krishi Kalyan Tax

A 0.5% tax on all taxable services under the Krishi Kalyan tax in a bid to benefit the farming community, which in turn will make a host of services like all services like bill payments, eating out, air travel costlier. 

Electricity bills to rise

Get ready to pay more on electricity bills as cess on coal has been hiked.

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