The interim budget has left income tax rebates on home loans and direct taxes unchanged even as acting finance minister Pranab Mukerjee said the economy has maintained a growth rate of over 9 per cent and the per capita income has grown by 4.7 per cent.

Gross tax revenue receipts of the union government at the existing rates of taxation are estimated at Rs6,71,293 crore and net tax revenue at Rs5,00,096 crore for the fiscal 2009-10, according to finance minister Pranab Mukherjee.

''With revenue expenditure estimated at Rs8,48,085 crore, the revenue deficit amounts to 4.0 per cent of GDP. Fiscal Deficit is estimated at Rs3,32,835 crore which is 5.5 per cent of GDP. This would be lower than in 2008-09, but higher than would be appropriate under normal circumstances. However, conditions in the year ahead are not likely to be normal and, therefore, the high fiscal deficit is inevitable,'' he said, adding ''We will return to FRBM targets once the economy is restored to its recent trend growth path.''

The minister also announced a slew of measures aimed at wooing the voters. He said the plan spending may have to be upped substantially post the general elections. He added that the additional plan expenditure has to increase by 0.5-1 per cent post polls.

He further said that the government was within striking distance of fiscal correction. He also said domestic investment rate as a proportion of domestic savings has increased to 39 per cent in 2008

With FY10 non-plan spending estimated at Rs668,000 crore, and major subsidy spending for the year rising to Rs95,500 crore, it is unlikely that the government offers any major reduction in tax rates – direct or indirect.

The tax to gross domestic product ratio in the country had,in fact, expanded from 9.2 per cent to 12.5 per cent in fiscal 2008.

The interim budget estimates for expenditure for 2008-09 have been revised to Rs900,953 crore, showing an increase of Rs150,069 crore. Of this, Rs39,571 crore is in the plan scheme and Rs110,498 crore is in the non-plan sector. Plan expenditure has been revised to Rs282,957 crore against the budgeted estimate of Rs243,386 crore.

The additional plan spending of Rs39, 571 crore is on account of an increase in the central plan by Rs24, 174 crore and an increase of Rs15, 397 crore in the central assistance to states and UT plans.