Retail investors whose annual income is between 2 - 5 Lakhs can also benefit from a tax credit of 2,000. The finance minister has also incentivized first time house buyers who take a housing loan of up to 25 Lakhs, by permitting them to deduct an additional 1 Lakh interest against their taxes.

The prices of white goods might increase due to increase in duties for luxury items such as SUV’s, mobile phones costing over 2,000, imported bikes, and set top boxes. This will have a negative impact on households.

The government has introduced a ‘super rich’ tax, which is gaining popularity world over, with an additional 10% surcharge on individuals with over 1 Cr taxable income. However, the finance minister has made assurances that this will be only for a period of one year.

We believe that the budget has disappointed the market as a whole, but will be good in the mid - long term for the economy. The outlook for the market remains positive for the medium term, while in the short term there could be some negative sentiment due to the muted budget and high expectation.

Overall, in our view this is a good budget with core areas being addressed and regulations becoming in favor of investments and growth.

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