Agriculture and Farmer’s welfare

1. Agricultural credit target for this fiscal year will be Rs.9 lakh crore.

2. Govt to allocate Rs 5,500 crore for crop insurance scheme.

3. Paramparagat Krishi Vikas Yojana to bring 5 lakh acres under organic farming.

4. 5 lakh hectares of land will to be brought under irrigation.

5. Govt will reorganise agricultural policy to double farmer income in next five years.

6. There will be four new schemes for the animal welfare .

Personal Finance

1. No changes have been made to existing income tax slabs

2. Rs 1,000 crore allocated for new EPF (Employees’ Provident Fund) scheme

3. The Government will pay EPF contribution of 8.33% for all new employees for first three years.

4. Deduction for rent paid will be raised from Rs 20,000 to Rs 60,000 to benefit those living in rented houses.

5. Additional exemption of Rs. 50,000 for housing loans up to Rs. 35 lakh, provided cost of house is not above Rs. 50 lakh.

6. Service tax exempted for housing construction of houses less than 60 sq. m

7. 15 per cent surcharge on income above Rs. 1 crore

Union Budget 2016 highlights

Tax

1. Infrastructure and agriculture cess to be levied.

2. Excise duty raised from 10 to 15 per cent on tobacco products other than beedis

3. 1 per cent service charge on purchase of luxury cars over Rs. 10 lakh and in-cash purchaseof goods and services over Rs. 2 lakh.

4. SUVs, Luxury cars to be more expensive. 4% high capacity tax for SUVs.

5. Companies with revenue less than Rs 5 crore to be taxed at 29% plus surcharge.

6. Excise 1 per cent imposed on articles of jewellery, excluding silver.There fore rates of gold jewellary will go up.

7. 5 per cent Krishi Kalyan Cess to be levied on all services.

8. Pollution cess of 1 per cent on small petrol, LPG and CNG cars, 2.5 per cent on diesel cars of certain specifications, 4 per cent on higher-end models.

9. Dividend in excess of Rs. 10 lakh per annum to be taxed at additional 10 per cent.

Some Important Banking Terms

>>Margin - Amount of profit added to cost price of each unit of a product

>>Margin call - Margin call term is used in two situations. First - Whenever a lender gives a secured loan and loan value is a fixed percentage of loan then whenever the value of security decrease below the decided ratio then lender given a margin call to borrower to bring loan to security ratio to decided level. Second , in stock exchanges traders trades in various securities by paying 20-30% of the value of securities. Whenever the value of security goes below that margin,broker gives margin call to trader to bring the margin to desired level. 

>>Mark-to-market - As explained above while defining margin call, value of assets in case of securities is measured on daily basis. If the trader's asset value increased, increased value is transferred to his account. In case the value of assets decreased margin call is made to adjust the margin.

>>ROI - Rate on investment is return divided by value of investment

>>Redemption - Maturity date of a security or a bond

>>Recession - An economic situation of negative growth

>>Repo rate - Rate at which Central bank (RBI in case of India) lends money to commercial banks

>>Reverse repo rate - Rate at which commercial banks lends to central bank

Banking Awareness

>>IPO - Initial public offer is issue of stocks for the first time in the market.

>>Intangible assets – Assets which can’t be seen but have value for business. For example – Goodwill.

>>Indemnity – A legal contract under which one party promises to pay another for any losses incurred to them by their acts.

>>Interest rate risk – Risk that value of financial assets will deteriorate because of fall in interest rate. For example value of bonds decreases with decrease in interest rate.

>>Junk fund – A fund which invests investor’s money in junk investments means high risk investments which high returns.

>>Monopoly - A situation in market where there are many buyers but a single seller exist.

>>Money market - Market dealing in short term lending and borrowing of funds. Also known as Cash market.

>>Monetary policy - Set of actions by Central bank of a country ( RBI in case of India) to control the supply of money. These actions included increase in interest rate, open market purchases,changing commercial bank's reserve funds ratio (SLR) etc.

>>Marginal cost - Additional cost to produce an extra unit of product.