Stock Markets reacted adversely on the proposed CTT (Commodity Transaction Tax) in line with the current STT (Security Transaction Tax ), the FM also announced an increase in Capital Gain Tax from existing 10% to 15%. This increase in CGT is not liked by many investors who trade with short term view. Though the loss made by the investors can be deducted from the CGT, investors get upset with any negative news from the FM. Already the stock market is no more a Bull Market with strong negative global cues, so the investors are against this increase.
The FM has given some concessions to the individual tax payers and to some industries like Auto in terms of increasing the IT (Income Tax) exemption limit, reducing ED(Excise Duty) and CST(Central Sales Tax). Now individuals can save more money and invest the money in Stock Market. Henceforth, there will not be any CTT(Cash Transaction Tax) for cash withdrawals from Bank.
Companies dealing with Tobacco products will face pressure as the price of non filtered cigarettes also will be treated at par with flitered cigarettes.
Agricultural Sectors, Auto Sectors and Pharma Sectors stand to gain better and the corresponding stocks are likely to perform well in the coming weeks.
The general public opinion in the society is this budget is citizen friendly and only some stock market maniac will react with high tension. Some are of the opinion that FM is a politician first then comes the budget.
Satisfied : Auto, Agriculture, Fertiliser, Power, Pharma, Paints, Media sectors and Farmers & Individuals
Not happy : IT, Textile, FMCG - Cigarette Manufacturing companies. The IT industry is disappointed that its demand for extension of the Software Technology Parks of India (STPI) scheme beyond 2009 was ignored in the Union Budget.