Budget acknowledges the fact that double digit inflation needs to be tackled on an urgent basis. Food price index in January stood at 17.56 % after touching 20 percent in December. But the measures announced does not provide the solution to this grave issue except for weak assurances by the FM-Pranab Mukherjee. First of all, the proposed increase in the price of fuel is likely to have an impact on the commodity prices due to higher transportation costs.
No respite to taxpayer at the lowest ladder of the income group. Rs 1.6 lakh exemption remain untouched except for Rs 20,000 rebate provided to those who can invest in infrastructure bonds.
On one count, the definition of affordable housing has undergone dramatic change with Rs 15-30 lakh becoming the norm. Now buying a house would be more difficult for the average middle class especially the salaried class whose income is upto 5 lakh per annum. It's a double side sword for the lowest and middle income groups.
Person earning more than 1.6 lakh and upto 5 lakh has to not only pay taxes as earlier. If the bechara middle class has to buy a house now, he has to pay higher rates almost twice the rate than what prevailed 3-4 years back, thanks to government and builders mili bhagat. He will also have to shell out housing loan interest to the banks and spend a life time to own a house. The basic housing is the fundamental right of every citizen of India. Why can't the government take steps in this direction and give respite to the common man?
People who are earning less than Rs 13,000 per month can be said to be living under poverty as per the tax norms. Food inflation coupled with real estate price hike is like slow poison for the average middle class person of India.
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