‘Where does the cess money go?’

For Vandana Chawla, the budget did not sound very exciting. A marginal increase in the exemption limit by Rs 10,000 was hardly any relief for her. However, what caught the interest of this 46-year-old school principal was the increase in education cess. The budget has imposed an additional secondary education cess of 1 per cent in addition to the primary education cess of 2 per cent. Comments Chawla: “Whatever benefit was extended by way of increased exemptions has been controlled by the additional cess. I wish the government would shed some light as to how are these funds being allocated. Being a principal and also a taxpayer, I am curious to know how are these funds being used. Given the lack of accountability, I find this increase particularly pinching.”

Vandana invests in mutual funds, and has three life insurance policies: one for herself and the other two for her children, Malvika who is studying abroad and Mohit who is gearing up for his 12th class boards. She also invests up to Rs 70,000 in PPF.

A simple lifestyle with very few luxuries, all her investments controlled, Vandana feels the Budget hardly has any life-changing, decision-making proposals for her.

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Husband, Atul, 50 an entrepreneur engaged in manufacturing printed circuit boards, the budget was a big disappointment. He thinks it could have done better to encourage savings among households. Says Atul: “I think they should have enhanced the Section 80C limit. There have been just tweaking here and there but on the whole as a tax payer I hardly gain anything”.

As an entrepreneur he feels the imposition of an additional one per cent education cess would only increase burden, “even though service tax has not been increased but an additional one per cent would only mean an increase. Even income tax effectively has been increased. As a businessman I was expecting Fringe Benfit Tax to go away bit that did not happen. All in all the budget was quite a disappointment”.