1. Service tax on ULIPS

Currently, traditional insurance policies and asset management service provided by mutual funds have to pay a service tax of 12.36%. Unitlinked insurance plans have now been brought into the service tax net, which means that the asset management cost can go up. However, insurance companies have not yet decided whether or not to pass on this extra cost to investors.

2. Capital gains tax

Buy shares for the long term. If you sell before even a year is up, you have to pay short-term capital gains tax of 15%. Assume you bought 10 shares of Reliance Industries on 1 February 2008 at Rs 2,424 and sold them on 29 February at Rs 2,542. Under the current 10% rate, you would have paid Rs 118 as short-term capital gains tax. Once the new tax rate comes into effect, you’ll end up paying Rs 177 as tax—that’s 50% more.

3. Additions to 80C

The 9% assured returns offered under the Senior Citizen’s Savings Scheme will now come under the Section 80C umbrella. So will Post Office term deposits of over 5 years. The country’s greying population got a further boost, as the tax exemption limit for senior citizens has been raised to Rs 2.25 lakh.

4. Health insurance

Till now, the government exempted from tax the payment of up to Rs 15,000 a year as premium for a health insurance cover. This limit has been extended to Rs 30,000 now. The caveat is that the additional Rs 15,000 must be spent on the health insurance premium on health cover taken for your parent(s). This means that you can effectively save up to Rs 4,500 on taxes, if you’re in the highest tax slab.

5. STT on commodities

The budget included the introduction of the commodities transaction tax at the same rate as the securities transaction tax. The new tax means that you will have to pay 0.017% of the option premium or the cost of commodity derivative as a seller and 0.125% as the buyer of options. So, on every sale of Rs 1,000, you pay an additional 17 paise, and when buying, you pay Rs 1.25 extra per Rs 1,000.