The union budget has announced tax relief for individual tax payers and raised tax exemption limits from Rs1.50 lakh to Rs1.60 lakh for ordinary individual taxpayers, from Rs2.25 lakh to Rs2.40 lakh for senior citizens, and from Rs1.80 lakh to Rs1.90 lakh for women taxpayers.

Surcharge on direct taxes is also planned to be removed. The budget has also raised the exemption limit for wealth tax. One per cent tax will now be charged on amounts exceeding Rs30 lakh instead of the earlier Rs15 lakh.

Further, to make the process of income tax return form simple and user friendly, Mukherjee has asked his department to speed up work on the 'Saral' II form for early introduction. (See: Mukherjee doles out tax sops to individuals, select businesses)

The budget proposals will also reduce prices of products like LCD televisions, life-savings drugs, bigger cars and branded jewellery, while set-top-boxes, and cotton apparel would be more expensive.

''The very fact that the Budget outlay has been increased by over 30 per cent means there will be a lot of spending to encourage growth. There is also a lot of savings for taxpayers, and all this will boost consumption across urban and rural markets,'' said Future Group CEO Kishore Biyani.

''It is, of course, not the budget alone, the monsoon, too, has to be equally good to ensure consumption-led growth,'' said Marico chairman Harsh Mariwala.