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Budget 1998-99 

Highlights of the budget presented by Finance Minister Yashwant Sinha

  • No change in rates of personal or corporate tax
  • Personal income tax exemption limit raised to Rs 50,000
  • Standard deduction increased to Rs 25,000 for incomes up to Rs one lakh
  • Tax free reimbursement of medical expence raised to Rs 15,000
  • Levy of gift tax discontinued; gifts to come under Income Tax Act
  • Petrol cess of Rs 1 per litre imposed to fund National Highways expansion.
  • Customs duty on newsprint reduced to 5%
  • Cigarettes to cost more but match boxes to be cheaper
  • Fiscal deficit is placed at 5.6% of GDP.
  • Growth-oriented budet with special thrust on agriculture, rural development
  • Plan allocation to agriculture increased by 58%
  • Rs. 3,000 crore for rural infrastructure development fund-IV
  • Government to come out with national agricultural policy paper soon
  • Inflow of Foreign Direct Investment to be doubled within two years
  • 90-day time-bound clearance of high value foreign investment proposals
  • Limit for NRI secondary market investment in Indian companies increased from one to five per cent and limit on aggregate NRI investment raised from 5 to 10 per cent
  • Persons of Indian origin holding foreign passports to get special cards granting them visa-free regime and other privileges
  • Insurance Sector to be thrown open to private Indian companies
  • FERA to be repealed and replaced with a new Foreign Exchange Management Act (FEMA).
  • Indian Airlines to be restructured and Government holding to be brought down to 49% in 3 years
  • Disinvestment of up to 74% in non-strategic public sector.
  • Budget allocation for education increased by 50%
  • Allocation for atomic energy up by 68 per cent and space by 2 per cent
  • Service tax on architects, CAs, real estate consultants
  • Across the board countervailing duty on imports
  • Three new schemes for tax simplification launched: Saral - one page return for all non-corporate tax payers; Samadhan for reducing litigation and quick realisation of arrears and Samman for recognition of honest tax payers