Tax sops likely in interim budget

The interim budget, to be presented by 16 February, may include some changes in the tax structure, reports quoting home minister P Chidambaram and finance ministry sources said.

The interim budget is likely to contain clarifications or modifications in indirect tax and sunset clauses of several schemes may also be considered for changes, CNBC-TV18 reported quoting official sources.

Some administrative measures on the direct tax front too are likely. A centralised assessment of income tax returns nationwide is also a possibility, it said.

In fact, the report said, the government is working on different packages,several of which may require cabinet approval while some others need a go-ahead from the legislature.

While the vote-on-account does not normally involve a policy shift, the UPA government is expected to raise outlays for social sector schemes substantially in an election year.

The government also hopes a Reserve Bank rate cut to follow the budget.

''The fiscal stimulus needs to continue in 2009-10 as well. Despite dwindling revenue, there is a case for another stimulus package. The Plan expenditure will part-finance the next stimulus package,'' planning commission deputy chairman Montek Singh Ahluwalia said on Wednesday.

While votes-on-account are usually calibrated around the existing level of expenditure, Ahluvalia said, this time round it could be ''substantially higher  because of the need for a fiscal stimulus.'' 

The budget may also enhance expenditure for social sector schemes. Expenditure for up to five months of the next fiscal is also likely in the budget and it would also include revised estimates of revenue and expenditure for 2008-09.

The budget session will start on 12 February with President Pratibha Devisingh Patil addressing a joint session of Parliament. The finance ministry is expected to present the interim budget for the next fiscal in the Lok Sabha on 16 February.

The budget session, however, is likely to be held for a short time, as the Lok Sabha elections will lead to fresh agendas by the newly elected central government.

With the general elections around the corner –  slated for April-May - the vote-on-account is likely to hike the outlays UPA' running flagship schemes by as much as 25-30 per cent from last year's levels, sources said.

Sectors like agriculture, rural development, health, minority affairs and human resource development are expected to see sizable jumps annual spending.

Allocation for defence, civil aviation, telecom and other economic ministries is likely to proportionately lower compared to the previous year.

Scope of National Social Assistance Programme expanded

The union cabinet today approved the expansion of the scope of National Social Assistance Programme (NSAP) to provide pension at the rate of Rs200 per month per beneficiary for the following categories of persons belong to a household below the poverty line according to the criteria prescribed by the government of India:

a) Widows who are between 40-64 years, under the scheme to be named as ''Indira Gandhi National Widow Pension Scheme' (IGNWPS).

b) Persons with severe and multiple disabilities who are between 18-64 years, under the scheme to be named as 'Indira Gandhi National Disability Pension Scheme' (IGNDPS).

Persons who are 65 years or higher, estimated to be 1.57 crore, have already been covered under Indira Gandhi National Old Age Pension Scheme (IGNOAPS), which was launched on 19 November 2007.

Consequent upon the expansion, the National Social Assistance programme would include (a) Indira Gandhi National Old Age Pension Scheme, (b) Indira Gandhi National Widow Pension Scheme, (c) Indira Gandhi National Disability Pension Scheme and (d) National Family Benefit Scheme.