Many speculations were made for the union budget 2018, some expected reduction in Income Tax, while some wanted relaxation in petroleum and crude oil. But now the budget is out and people have mixed reactions to it.

On one hand Income tax slabs remained as they were and the exemption limit wasn`t raised, while customs duty and cess will only raise prices of mobile phones, televisions and more.

Talking of the positive response first, FinMin announced that the government will contribute 12% PF for new employees in all sectors for three years.

For women, PF contributions will be cut from 12% to 8% for the first three years.

Senior citizens will now have additional relief on income from bank interest (Rs. 30,000), investment in mediclaim (Rs. 50,000) and FDs (Rs. 50,000).

While for salaried taxpayers, the government has increased standard deduction from Rs. 15,000 to Rs. 40,000, a move which is likely to do good to 2.5cr taxpayers. This is in lieu of transport and medical reimbursement, which is worth Rs. 30,000. So, in reality, the actual tax benefit would be Rs. 10,000.

On the negative front the government has proposed to increase customs duty on mobile phones from 15% to 20%, and on mobile and television parts to 15%. This, in turn, is likely to drive up prices of these electronics.

Apart from this, all goods and services on which health and educational cess are taxed and will cost more from now, with rates being raised from 3% to 4%.

Also, if you were planning to have some extra income by investing in the booming bitcoins, you’ll be disappointed. FinMin warned against the use of cryptocurrency, reminding citizens that it is not legal tender.

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