Income Tax exemption limit to Rs 5 lakh will be implemented only by next govt

New Delhi, Feb 01: The big announcement in today's budget was with regard to income tax.

Finance Minister, Piyush Goyal said that the government proposes to raise the income tax exemption limit to Rs 5 lakh. However the question is when will this be implemented.

Since it was an interim budget, the implementation of this decision has been left to the next government. The budget also proposed to raise the standard deduction to Rs 50,000.

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It was also decided to hike the gratuity limit from Rs 10 lakh to Rs 30 lakh and also announced a Mega Pension Yojana under which Rs 3,000 per month will given to unorganised sector employees.

Presenting the interim budget for 2019-20, Finance Minister Piyush Goyal said the Mega Pension Yojana -- 'Pradhan Mantri Shram Yogi Mandhan (PMSYM)' -- will benefit 10 crore workers in the unorganised sector.

"It may become the world's biggest pension scheme for unorganised sector in five years," Goyal said.

He said 50 per cent of the country's Gross Domestic Produce (GDP) comes from "sweat and toil of 42 crore workers in the unorganised sector."

The Finance Minister also announced increase of gratuity limit from Rs 10 lakh to Rs 30 lakh from the next fiscal.

Under the PMSYM, Goyal said a monthly pension of Rs 3,000 per month will be assured for workers in the unorganised sector after 60 years of age. The pensioners will have to contribute Rs 100 per month.

High growth and formalisation of economy has resulted in increased Employees' Provident Fund Organisation (EPFO) membership by 2 crore in last two years, he added.