Recently, the Union Finance Minister Mr. Arun Jaitley placed the Budget-2015 in Lok Sabha. There is no change in the Income Tax Slab of personal Income-tax. He announced the tax proposals with no change in the rate of tax for companies in respect of the income earned in the financial year 2015-16, assessable in the assessment year 2016-17.
Apart from this, the Finance Minister Shri Arun Jaitley increased levy a surcharge at the rate of 12% on individuals, HUFs, AOPs, BOIs, artificial juridical persons, firms, cooperative societies and local authorities having income exceeding Rs 1 crore from 7%. The Surcharge for domestic companies having income exceeding Rs 1 crore and upto Rs 10 crore is proposed to be levied @ 7% and surcharge @ 12% is proposed to be levied on domestic companies having income exceeding Rs 10 crore.
BENEFITS TO MIDDLE CLASS TAX-PAYERS
- Limit of deduction of health insurance premium increased from Rs. 15000 to Rs. 25000, for senior citizens limit increased from Rs. 20000 to Rs. 30000.
- Senior citizens above the age of 80 years, who are not covered by health insurance, to be allowed deduction of Rs. 30000 towards medical expenditures.
- Deduction limit of Rs. 60000 with respect to specified decease of serious nature enhanced to Rs. 80000 in case of senior citizen.
- Additional deduction of Rs. 25000 allowed for differently abled persons.
- Limit on deduction on account of contribution to a pension fund and the new pension scheme increased from Rs. 1 lakh to Rs. 1.5 lakh.
- Additional deduction of Rs. 50000 for contribution to the new pension scheme u/s 80CCD.
- Payments to the beneficiaries including interest payment on deposit in Sukanya Samriddhi scheme to be fully exempt.
- Service-tax exemption on Varishtha Bima Yojana.
- Concession to individual tax-payers despite inadequate fiscal space.
- Lot to look forward to as fiscal capacity improves.
- Conversion of existing excise duty on petrol and diesel to the extent of Rs. 4 per litre into Road Cess to fund investment.
- Service Tax exemption extended to certain pre cold storage services in relation to fruits and vegetables so as to incentivise value addition in crucial sector.
- Negative List under service-tax is being slightly pruned to widen the tax base.
- Yoga to be included within the ambit of charitable purpose under Section 2(15) of the Income-tax Act.
- To mitigate the problem being faced by many genuine charitable institutions, it is proposed to modify the ceiling on receipts from activities in the nature of trade, commerce or business to 20% of the total receipts from the existing ceiling of Rs. 25 lakh.
- Most provisions of Direct Taxes Code have already been included in the Income-tax Act, therefore, no great merit in going ahead with the Direct Taxes Code as it exists today.
- Direct tax proposals to result in revenue loss of Rs. 8315 crore, whereas the proposals in indirect taxes are expected to yield Rs. 23383 crore. Thus, the net impact of all tax proposals would be revenue gain of Rs. 15068 crore.
INCOME TAX SLAB FOR ASSESSMENT YEAR 2016-17
1. Tax Slab for an Individual (resident & below 60 years) or HUF/AOP/BOI/AJP
Income Slabs
|
Tax Rates
|
Total income up to Rs. 2.5 Lac
|
0% Tax
|
Total income above Rs. 2.5 Lac and below Rs.5 Lac
|
10% on amount exceeding Rs. 2.5 Lac
|
Total income above Rs. 5 Lac and below Rs.10 Lac
|
20% on Income exceeding Rs. 5 Lac + Rs. 25,000
|
Total income more than Rs. 10 Lac
|
30% on Income exceeding Rs. 10 Lac + Rs. 1,25,000
|
Rebate u/s 87A the Individual having taxable income up to Rs. 5 Lac , can claim rebate, on the Actual Tax amount subject to a maximum of Rs. 2,000
Where the Taxable Income exceeds Rs. 1 crore, Surcharge @ 12% of Income tax is applicable
2. Tax Slab for an Individual (resident & above 60 years but below 80 years)
Income Slabs
|
Tax Rates
|
Total income up to Rs. 3.00 Lac
|
0% Tax
|
Total income above Rs. 3.00 Lac and below Rs.5 Lac
|
10% on amount exceeding Rs. 3.00 Lac
|
Total income above Rs. 5 Lac and below Rs.10 Lac
|
20% on Income exceeding Rs. 5 Lac + Rs. 20,000
|
Total income more than Rs. 10 Lac
|
30% on Income exceeding Rs. 10 Lac + Rs. 1,20,000
|
Rebate u/s 87A the Individual having taxable income up to Rs. 5 Lac , can claim rebate, on the Actual Tax amount subject to a maximum of Rs.2,000
Where the Taxable Income exceeds Rs. 1 crore, Surcharge @ 12% of Income tax is applicable
3. Tax Slab for an Individual (resident & above 80 years)
Income Slabs
|
Tax Rates
|
Total income up to Rs. 5 Lac
|
0% Tax
|
Total income above Rs. 5 Lac and below Rs.10 Lac
|
20% on Income exceeding Rs. 5 Lac
|
Total income more than Rs. 10 Lac
|
30% on Income exceeding Rs. 10 Lac + Rs. 1 Lac
|
Where the Taxable Income exceeds Rs. 1 crore, Surcharge @ 12% of Income tax is applicable
EDUCATION CESS
The amount of Income-tax shall be increased by Education Cess of 3% on Income-tax.
