The budget 2012-13 has failed to cheer the market. Sensex closed at 17,466, down 210 points. Nifty closed down by 62 points. Metal, IT, Oil & Gas, and banks were the major losers. Even middle class has a lot to worry about. Telecom bills are set to rise.
Finance Minister Pranab Mukherjee proposed to raise the service tax to 12 percent from the existing 10 percent while presenting the budget for 2012-13, adding that a few essential services such as education will be exempted from the service tax.
Bills for mobile phones are expected to rise following a two percent hike in service tax proposed in the union budget, service provider Bharti Airtel. “Service tax goes up from 10 to 12 percent and obviously that will be passed on to the customers,” Sanjay Kapoor, Bharti Airtel chief executive officer for India and South Asia, said.
Personal computing gadgets and accessories, including desktops, laptops, tablets, printers, UPS and mobile phones, will cost more thanks to a hike in excise duty from 10 percent to 12 percent.
“The prices of all our PCs will rise by 2 percent. A Rs 25,000 PC will now cost an extra Rs 500,” said S Rajendran, chief marketing officer of Acer India. Even imported products, which will now attract an additional 2 percent countervailing duty, will become more expensive.