In the fine print it is really quite a mixed bag

<div class="section1"><div class="Normal">Budget 2003 has been bitter-sweet for the taxpayer. Those with incomes below Rs 5 lakh can take some cheer from the standard deduction available to a salaried employee going up to 40 per cent, or Rs 30,000, whichever is lower. <br /><br />For salaries beyond Rs 5 lakh, however, standard deduction has been re-introduced at a flat Rs 20,000.There is no surcharge for salaries up to Rs 8.5 lakh. <br /><br />However, for individuals drawing a salary of more than Rs 8.50 lakh, the surcharge has been increased to 10 per cent. The rebate under section 88 still holds true, and there has been one more inclusion under Section 88. <br /><br />Tuition fees paid for full-time education of children is eligible for rebate up to Rs 12,000 per child up to a maximum of two children. <br /><br />The benefits have been also extended to senior citizens as the limit of their tax rebate has been enhanced to Rs 20,000. The individual will be hit by an increase in the service tax of five per cent to eight per cent. <br /><br />Ten more services have been added to the existing list.<br /><br />Moreover, the investment scenario looks grim. The interest rates on savings have taken a hit. The rate for NSCs, PPF, KVP, RBI have all gone down by one percentage point. The new RBI Bond of seven per cent has also been reduced to six per cent. <br /><br />The good news on investment front is that the dividend income now becomes taxed in the hands of the investor. <br /><br />Further, any investment in listed companies on or after March 1, 2003, will now not attract long-term capital gains. The intention of the FM is to move the small investor to equity and equity-oriented schemes. But how far this will fit into an individual''s scheme of investments remains to be seen. <br /><br />The incentive - attractive interest rates - for saving for an individual are gone. The silver lining: an individual will now make investment decisions on the basis of fundamentals of investing instead of just viewing them as tax saving instruments. <br /><br />The government has taken several steps to reduce interest rates so that cheap funds are available to the industry. But in this process the tax payer has been hit hard. <br /><br />(<span style="" font-style:="" italic="">The author is a financial advisor</span>)</div> </div>