By: Vineet Agarwal, Director, KPMG

The much anticipated Budget 2014 has been delivered amid an environment of price rise and huge expectations from the government. Finance minister Arun Jaitley has laid out the government's intent by committing to limit fiscal deficit and setting a target to bring it down to 3% by 2016-17.

Some bold steps at a macro-economic level are to increase FDI in defence and insurance and stress on boosting public-private-partnership and infrastructural development.

Jaitley also emphasised on noble causes like supporting citizens with special needs and women protection. On the personal tax front, there are three key changes that bring cheer to individual tax payers. As expected, the finance minister raised the basic income-tax exemption limit while leaving the tax rates unchanged. It will hopefully help in softening the impact of rail fare and fuel price increase.

The minister raised concerns over the level of savings which declined. With a view to raise the quantum of savings and channelizing them into growth inducing assets, the investment limit under 80C has been increase. It will encourage more saving and investment by people which will help them save money for their future needs and also increase the overall savings rate.

The Government finally seems to have recognized that the overall increase in real estate cost has cast a higher interest burden on loans taken by home buyers. The tax exemption on interest component of housing loan for self-occupied property has been raised. However, given that this limit was set way back in 2001, bigger increase in deduction limit was expected.

An amendment has been brought in Section 54 and 54F to clarify that the exemption from capital gains tax would be available only on reinvestment of sale proceeds in case of one house belonging to tax payer and that too where the house is situated in India.

Courts had recently interpreted this provision favorably holding that benefit of reinvestment of capital gains was available for more than one house and also where the house was situated outside India.

The amendment reverses these decisions. On the social security front, the Government has kept in mind the welfare of employees in the organized sector. Augmenting this Government's focus on administrative efficiency and streamlining procedures, the Employees Provident Fund Office will introduce a 'Unified Account Number' for its members resulting in better service and portability of their EPF account.

This move will definitely strengthened the social security support in line with the western world. All in all, there is a positive effect of leaving more cash in hand. Overall it's a good budget from an individual's perspective.