Budget gives Income Tax relief but there's a catch: No change in slabs

NEW DELHI: Finance minister Piyush Goyal on Friday announced a tax rebate for individual taxpayers + earning up to Rs 5 lakh, but there's a catch for the rest. The government has not tweaked the income tax (I-T) slabs. Yes, you've read this right. Those who are earning more than Rs 5 lakh will have to shell out the tax at the same rate as they were paying before.

The finance minister said that the current tax slabs of 20 per cent tax on income between Rs 5 lakh and Rs 10 lakh and 30 per cent tax on earnings of over Rs 10 lakh would continue in the next fiscal year beginning April 1, 2019.



Here are some of the important announcements made in this year's budget:

* Goyal announced Rs 6,000 annual cash dole to poor farmers in a scheme that will cost Rs 75,000 crore per year. The eligibility for the scheme, called Pradhan Mantri Kisan Samman Nidhi, is applicable to owners of less than 2 hectares of cultivable land.



* TDS threshold on interest from bank and post office deposits has been raised from Rs 10,000 to Rs 40,000.

* Also, TDS threshold for deduction of tax on rent has been increased to Rs 2.4 lakh from current Rs 1.8 lakh.

* Over three crore salaried class, pensioners, self-employed and small businesses will save Rs 18,500 crore in income tax annually after the exemption limit was doubled to Rs 5 lakh for the next fiscal from current Rs 2.5 lakh. Also, standard deduction was raised to Rs 50,000 from current Rs 40,000.

* Goyal said capital gains of up to Rs 2 crore made from sale of immovable property can now be invested in two residential houses as against current practice of exempting such income if invested in one house within a year.

* Income tax refunds will be processed within 24 hours and released immediately. Within the next two years, the assessment of all tax returns will be done electronically.

* Mega pension yojana namely 'Pradhan Mantri Shram-Yogi Maandhan' (PMSYM) for the unorganised sector workers with monthly income up to Rs 15,000. This pension scheme will provide workers an assured monthly pension of Rs 3,000 from the age of 60 years on a monthly contribution of Rs 100 per month during their working age --from age 29 to 60.




(With agency inputs)