Mumbai: Stock Brokers on Monday expressed disappointment over absence of relief on Corporate tax and Security Transaction tax (STT) in the Union Budget, tabled by finance minister Pranab Mukherjee in Parliament.
The Sensex crossed the 15k level minutes after the trading started on expectations of lowering of Security Transaction Tax and Corporate Tax. However, the Union Budget failed to live up to market expectations, which pulled the Nifty below the 4200 mark and the Sensex below 14,200 level in mid session.
Reacting to the general budget, Bombay Stock Exchange Chairman Jagdip Capoor said, "Lack of announcements on divestment, fuel, FDI and 3G policies and no reduction in corporate tax had disappointed
the markets".
Brokers and small investors will be investing in only certain scrips, which will benefit by the budget. However, there was no major crisis in fund liquidity and Sensex would stabilise between 12,000 and 20,000 by the next union general budget, he observed.
Senior BSE and NSE member Ramesh Damani, who was unhappy over the budget, said divestment target of around Rs 1,100 crore was very low.
"However, there were some positive announcements like implementation of Goods and Services Tax (GST) from April 1, 2010, abolition of Commodities tax and Fringe Benefit Tax (FBT), extension of Software Technology Parks of India (STPI) tax for one more year and removal of surchage of 10 per cent on Personal Income Tax," he said.
MCX director hails budget as visionary
MCX Director Anjani Sinha welcomed the Union Budget 2009-10 as "visionary and good for the commodity markets".
Commenting on the budget, he said, "It will stimulate huge investment in the warehousing sector since the uncertainty of commodity market viability with respect to the cost of transaction (CTT) has been removed and now it will be at par with top 25 global commodities exchanges, which constitutes 99.99 per cent of the world's exchange traded commodity derivative volume."
This announcement will put Indian commodity market ecosystem at par with international exchanges with respect to cost of hedging, thereby fulfilling the government's vision of making Indian commodity derivative market competitive on a global canvass, he added.
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