Takeaway for a Housewife from Budget 2010!

By | February 26, 2010

The basic excise duty has been increased from 8% to 10%. This will have a compounding effect on almost all goods. By the time this article is written, there is some news that the petrol prices will be increased by about Rs.2.85/liter. Car makers have told that they will be increasing the prices after the higher tax rate will be implemented. Cost of cement will go up. Electricity may cost more as there is a additional duty on coal.

Almost all commodities like steel, copper, plastics, etc are going to cost more. This in turn will make all white goods including TVs, washing machines, fridges, mixies & food processors and wet grinders to cost more.

There is good reason for any salaried person to cheer the Budget 2010. The salary slabs for tax has been increased. Is there something for the housewife too? Let’s see how the monthly budget of a housewife will be affected by Union Budget 2010.

Reasons to Cheer

There is some good news from the budget for the housewife in the form of support for her budget.

She can ride more easily: The Budget 2010 has at last heard the request from electric vehicle manufacturers. The duty on critical components required to manufacture electric vehicles has been reduced to 4%. The finished vehicles also will suffer only 4% duty.

She can cook faster and at lesser cost: The aspirational housewife can cook faster as the cost of Microwave Ovens will be lesser. The duty has been reduced from 10% to 5% on the key component – Magnetron.
She can buy a better phone: The duties for mobile phone accessories made in India have been reduced to zero.

She can shop more: Goods imported for retail sale in pre-packaged condition are exempt from special additional duty. Goods like watches, mobile phones and ready-made garments will get this exemption even if they are not prepacked.

Children’s Parties can be more colourful: Toy balloons have been exempt from excise duty. (Have you seen the cost of some of the fancy balloon lately???!!!) They will be more economical now.

Better drinking water: Reverse Osmosis based household water filter kits will cost lesser as the duty has been reduced to 4%.

House maintenance will cost lesser: Goods under the heading Medicinal and Toilet Preparation will suffer lesser tax at 10% from the present 16%.

More Jewellery: Gold will cost lesser in the long run as the duty on gold ore and refines has been shifted from ad valorem rates (in %) to specific duties (Rs. per gram). The tax will not go up even if the base price of gold increases in the long run.

More money in husband’s wallet: The personal income tax slabs have been increased.

Reasons to Lament

There are some reasons why the Budget 2010 will leave lesser balance in the monthly budget for the housewife too.

Can’t afford dropping children to school: The cost of petrol and diesel will jump due to the imposition of customs and excise duties on crude and petrol and diesel.

Cost of most goods will go up: The basic excise duty has been increased from 8% to 10%. This will have a compounding effect on almost all goods. By the time this article is written, there is some news that the petrol prices will be increased by about Rs.2.85/liter. Car makers have told that they will be increasing the prices after the higher tax rate will be implemented. Cost of cement will go up. Electricity may cost more as there is a additional duty on coal.

Almost all commodities like steel, copper, plastics, etc are going to cost more. This in turn will make all white goods including TVs, washing machines, fridges, mixies & food processors and wet grinders to cost more.

Holiday Travel to cost more: Air travel in India competed with railways for a few years in the past. Their advantage is withdrawn by making all classes of air travel to pay service tax.

End of Month for Housewife

Though the list is longer for the reasons to cheer, the housewife will be left with lesser cash in hand at the end of the month. This is because of the higher cost for most of the day-to-day goods and commodities that she will have to buy. End of the month an average Indian housewife will more burden on her shoulder throughout year 2010-11.

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