Modi's 'Tough' Acts May Inflict Budget Discomfort for Middle Class

LPG hike: In India, almost all the household depend on LPG cylinders for cooking. So, it is indeed a good news for millions of household that the price of domestic LPG cylinders will not be increased and the number of subsidized refills given to consumers would continue.

Union Petroleum Minister Dharmendra Pradhan said "LPG will be provided to the consumers at the same rate at which it is being made available now. No additional burden will be imposed on them. The subsidy and the number of subsidized cylinders that people are getting will be continued by our government," reports PTI.
"There is a need to increase oil and gas production in the country. The policy should be such that neither the government nor the farmers and poor should feel burdened," the minister added.

Tax-exemption limits: The new government is likely to ease the tax burden on the middle class and impose a higher tax on the super rich in its first Budget to be presented by Union finance minister Arun Jaitley next month. As per the sources, the government thinks that the disposable income of the middle class has eroded due to persistent inflation and there is a strong case for providing some tax relief.
Mahambare of CRISIL Research exclaimed, "Ultimately the government should work towards increasing people's income. A manufacturing push is needed to create more jobs and ensure greater incomes of people."
"The government can either reduce costs or increase revenue in order to get its fiscal house in order. There are a very small percentage of people paying taxes in India. The government will have to work to broaden the tax base," Nitin Jain added.

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