May increase Tax Slab Exemption Limit for Assessment year 2013-14 in the Budget 2012-13

As per the Economical Finance survey some good news for Salaried Taxpayee that, the Finance Minister Pranab Mukharjee may announced in the Budget 2012-13 New Tax Slab Exemption Limit for Assessment year 2013-14 by increasing the income tax exemption limit up to Rs. 200000.00 Now the existing Tax Exemption limit is Rs. 180000.

Sources indicated that the new tax slabs could be in line with the Direct Taxes Code Bill, which was introduced in Parliament in 2010. The bill has proposed that incomes between Rs. 2 to 5 lakh be taxed 10%, those between Rs. 5 to 10 lakh be taxed 20% and incomes above Rs. 10 lakh per annum be taxed 30%. At present, incomes between Rs. 1.8 lakh and Rs. 5 lakh are taxed 10%, those between Rs. 5 to 8 lakh taxed 20% while incomes above Rs. 8 lakh attract a tax rate of 30%. (Check ready reckoner for Financial year 2011-12)

A rejig in tax slabs along with a hike in exemption limits will enhance people's disposable incomes, which, in turn will boost consumption spending as well as savings.The government is negotiating through a maze of thorny issues ahead of this year's budget amid faltering demand and rising prices that have hit growth in the broader economy.


80 (c) limit should be increased.That's where most of people get hit. As base salary increases , a substantial (if not all) amount under 1 lakh 80 c limit gets covered with PF , Now a days minimal insurance amount doesn't help. Insurance , ULIp also comes under 80 (C). As if this is not enough, Even home loan part also come under 80 c , So essentially you end up saving very less if you compare to what all you have invested under 80 c. More than 90% of investments by a average indian falls under 80 c . 1 lakh limit on 80c is grossly under par.

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