NEW DELHI, Mar 10, 2006 : WITH the announcement of dates for elections for State Assemblies in five states the Budget Session of Parliament has been rescheduled. And the twin objectives are to enable the Members of various political parties to campaign for their respective parties and also facilitate smooth transaction of necessary parliamentary business. In this backdrop, it is learnt that the Union Budget 2006 is all set to make a history - the Lok Sabha may approve it on March 20 and Rajya Sabha may follow suit either on March 21 or 22st - the last day for the House before it reconvenes on May 10 for a short while.

If it happens what would be its implications for the industry besides the overworked lot of publishers who will have to come out with their reckoners etc so quick! The major beneficiary would be the Finance Minister who never reckoned revenue collections for additional months like part of April and May. A major part of the bonanza coming Mr PC's way would be the immediate hike in the service tax rate of 12 per cent. As against June it may be effective from April 15.

Going by the budgetted revenue of Rs 34000 Cr from service tax in the fiscal 2006-07 it may safely be assumed that thanks to the gain of additional 35-45 days the Finance Minister may expect an additional Rs 600-1000 Cr from service tax alone.

Though it is difficult to hazard any specific figures in Incom Tax but given that a host of exemptions have been withdrawn and norms tightened, once they come into effect a bit early it would certainly help reduce tax expenditure for the new fiscal.

The Finance Bill is presented to parliament so that the legislature can discuss the finances of the nation. The discussions on the budget assume significance as it is a public audit of the way the government wants to spend the tax payers’ money. Over the years with frequent disturbances and most of the Parliamentary time going in prolonged discussions over irrelevant issues, discussion on the Finance Bill has hardly any parliamentary time and bills are passed without any debate. Government and the clever Executive have noticed this trend and greatest advantage is taken out of this unfortunate situation. Many proposals which in normal times will not pass through parliamentary scrutiny are smuggled through budget papers because our babus know well that the best way to pass an unwelcome law is to put it in some obscure corner of the mountain of budget papers.

This year’s Finance Bill proposes some draconian measures under Service Tax which will now become law with hardly any debate.