Finance Minister Pranab Mukherjee's Budget 2012 delivered a staggering blow by hiking the service tax and excise duty by 2%. This hike is definitely going to have an impact on the family budget for the next financial year. Take a look at how this hike will affect your Budget.
For Students, the peak rate of service tax has been increased which means on a fee of Rs. 50,000 service tax is currently 5,000 (education cess additional), from April this will increase to Rs. 6,000. The students who train at a dance or sports academy may also have to pay a higher fee. Accommodation and canteen service charges at PG hostels may also go up.
Though preventive health check-ups for up to Rs5,000 are exempt, a visit to the dentist or diagnostic tests will be more expensive due to the higher service tax levied on these. You will also be shelling out more on your life insurance policy.
To add to the agony, the newly hiked excise duty as well as the customs duty is going to inflate the family expenses like never before. Manufacturers are bound to pass the burden of the same to the end-consumers. Be prepared to pay more on everything from cosmetics to watches and washing machines.
Perhaps the only good news is increase in cigarette prices which will help you quit smoking and since these taxes are mostly levied on discretionary spends, not on roti, kapda and makaan, you could tighten your purse strings.
The fact is that your everyday expenses are bound to go up because of the 2% hike in the indirect taxes. Not only the hike but also more services have been made taxable with a view of bailing out the government treasury from any financial upheaval. Here's a look at how much more you will pay every year as service tax and other indirect taxes.
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For Students, the peak rate of service tax has been increased which means on a fee of Rs. 50,000 service tax is currently 5,000 (education cess additional), from April this will increase to Rs. 6,000. The students who train at a dance or sports academy may also have to pay a higher fee. Accommodation and canteen service charges at PG hostels may also go up.
Though preventive health check-ups for up to Rs5,000 are exempt, a visit to the dentist or diagnostic tests will be more expensive due to the higher service tax levied on these. You will also be shelling out more on your life insurance policy.
To add to the agony, the newly hiked excise duty as well as the customs duty is going to inflate the family expenses like never before. Manufacturers are bound to pass the burden of the same to the end-consumers. Be prepared to pay more on everything from cosmetics to watches and washing machines.
Perhaps the only good news is increase in cigarette prices which will help you quit smoking and since these taxes are mostly levied on discretionary spends, not on roti, kapda and makaan, you could tighten your purse strings.
The fact is that your everyday expenses are bound to go up because of the 2% hike in the indirect taxes. Not only the hike but also more services have been made taxable with a view of bailing out the government treasury from any financial upheaval. Here's a look at how much more you will pay every year as service tax and other indirect taxes.
Items
|
Expenses (Rs)
|
Service Tax
| |
| 10.30% |
12.36%
| ||
| Telephone Bills |
20,000.00
|
2,060.00
|
2,472.00
|
| Coaching Class |
26,000.00
|
2,678.00
|
3,213.60
|
| Eating Out |
18,000.00
|
1,854.00
|
2,224.80
|
| Gyms |
25,000.00
|
2,575.00
|
3,090.00
|
| Car Maintenance & cab rental services |
10,000.00
|
1,030.00
|
1,236.00
|
| Cable TV |
2,400.00
|
247.20
|
296.64
|
| Healthcare |
5,000.00
|
515.00
|
618.00
|
| Life insurance premium (mortality charges only) |
7,000.00
|
721.00
|
865.20
|
| Functions (catering, tent & photographer) |
15,000.00
|
1,545.00
|
1,854.00
|
| Real estate agent / stock broker |
12,000.00
|
1,236.00
|
1,483.20
|
| Salons, courier, packaging services, etc |
8,000.00
|
824.00
|
988.80
|
| Transportation |
40,000.00
|
4,120.00
|
4,944.00
|
| Jewellery |
60,000.00
|
6,180.00
|
7,416.00
|
| Entertainment |
8,200.00
|
844.60
|
1,013.52
|
| Holiday | |||
| Hotel stay for 5 days |
25,000.00
|
2,575.00
|
3,090.00
|
| Food & beverages at hotel |
4,000.00
|
412.00
|
494.40
|
| Air Travel |
24,000.00
|
2,472.00
|
2,966.40
|
| Train travel |
12,800.00
|
Nil
|
1,582.08
|
| Tour operator / travel agent |
3,000.00
|
309.00
|
370.80
|
| Total | 325,400.00 | 33,516.20 | 40,219.44 |
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